Warren Buffett's Berkshire Hathaway on Thursday made a new investment in Domino's Pizza & Pool Corp. in the third quarter, despite exiting stocks such as Apple and Bank of America. announced.
As of September 30, Berkshire owned 1.28 million Domino shares worth about $549 million. He also held 404,000 shares of pool equipment retailer Pool (worth approximately $152 million as of the same date).
The investment was disclosed in a filing with the Securities and Exchange Commission detailing Berkshire's U.S.-listed investments as of Sept. 30.
Domino's Pizza shares rose 6.9% in after-hours trading after Berkshire's disclosure, while Pool shares rose 5.7%.
Berkshire's stock price often rises after it discloses a new investment, reflecting investors' belief that Buffett is giving him the seal of approval.
Thursday's filing did not say whether Buffett or portfolio managers Todd Combs and Ted Weschler were responsible for individual investments.
Neither Domino's nor Poole immediately responded to requests for comment.
Like McDonald's and other chains, Domino's is ramping up promotions to attract value-conscious customers who prefer high-end fast food and home delivery and avoid high-priced sit-down chains.
Meanwhile, Pool said last month that demand for non-discretionary repair and maintenance services for existing pools was partially offsetting “soft” demand for new pool construction.
Berkshire made the investment even though Buffett was hoarding cash.
The Omaha, Nebraska-based conglomerate nearly doubled its cash and equivalent holdings in 2024 to $325.2 billion as of Sept. 30, and also suspended stock buybacks for the first time since 2018. .
Berkshire sold $36.1 billion in stock and bought just $1.5 billion in the quarter that ended Sept. 30. For the year, Berkshire sold $133.2 billion in stock (mostly Apple, then Bank of America) and bought just $5.8 billion.
Buffett hasn't said specifically why Berkshire is cutting production, but taxes may be a factor. Investors say he may think valuations are too high.
The cash also gives Berkshire, which has a market value of about $1.01 trillion, room to make acquisitions that move the needle while Buffett, 94, continues to lead the executive team.
During the quarter, Berkshire also increased its holdings in aircraft parts maker Heiko.
It sold its entire stake in flooring retailer Floor & Decor, as well as some stakes in Capital One, Charter Communications, Brazilian digital bank operator Nu Holdings, and cosmetics chain Ulta Beauty.
The sale of more than 96% of Ulta's shares marks a rapid turnaround for Berkshire, which first disclosed its investment in Ulta in August. Ulta shares fell 3.8% in after-hours trading.
Berkshire also owns dozens of companies, including Geico Auto Insurance, BNSF Railway, and various consumer, energy, industrial, and retail businesses.
