Aug. 15 -- Billionaire investor Warren Buffett’s Berkshire Hathaway Inc. took a stake in Becton Dickinson & Co., as shares of the syringe and laboratory equipment maker advanced in the second quarter.
Berkshire had 1.2 million shares of the Franklin Lakes, New Jersey-based medical supplies company at the end of the second quarter, Berkshire said yesterday in a regulatory filing listing U.S. stock holdings as of June 30. Omaha, Nebraska-based Berkshire also increased its stake in Johnson & Johnson, the world’s largest maker of health-care products, by 14 percent to 36.9 million shares.
“Becton Dickinson is an old-line company, a leader in its chosen field, and it has predictable cash flows and future earnings,” said Frank Betz, a partner at Warren, New Jersey- based Carret Zane Capital Management, which owns Berkshire shares.
“He’s keen on the health-care sector and its long-term possibilities as Americans age.”
Buffett built a stock portfolio valued at more than $48 billion by betting on companies including soft-drink maker Coca- Cola Co. that he believes have competitive advantages and enduring brand popularity.
Known as the “Oracle of Omaha,” Buffett, 78, is a cult figure among investors who mimic his stock picks.
He drew a record 35,000 people to Omaha’s Qwest Center arena for the shareholders meeting this year.
“When you have a history of investing success like Warren Buffett, anybody who doesn’t pay attention to what he’s doing in his stock portfolio does so at their own risk,” Betz said.
Surgical Blades
Becton manufactures products including needles and syringes, catheters, surgical blades and scalpels and critical- care monitoring devices, according to its Web site.
The company climbed 6.1 percent in the three months ended June 30 to $71.31 on the New York Stock Exchange.
Becton closed yesterday at $66.39. Liz Ryan Sax, a spokeswoman for Becton Dickinson, had no immediate comment.
Buffett makes most of the investment decisions at Berkshire, while Lou Simpson, 72, manages the portfolio for car insurance unit Geico Corp. Buffett has cautioned investors against assuming all moves in the equity portfolio are his.
The filing omits information about quarterly transactions because Buffett was granted permission to keep some moves confidential for now.
The U.S. Securities and Exchange Commission sometimes allows companies to withhold information from the public to limit copycat investing while a firm is building or cutting a position.
Berkshire slashed holdings in Eaton Corp., the Cleveland- based maker of circuit-breakers and fuel pumps, by 38 percent to 2 million shares.
Berkshire disclosed the Eaton stake last year.
Carmax, WellPoint
The firm also cut its stake in used-car dealer Carmax Inc. by 25 percent to 9 million shares, and reduced holdings of Home Depot Inc. by 25 percent to 2.76 million shares.
Berkshire reduced holdings of WellPoint Inc. 27 percent to 3.5 million shares and sold 24 percent of its shares in UnitedHealth Group Inc., lowering its total to 3.4 million shares.
Buffett, who is Berkshire’s chairman and chief executive officer, last week disclosed the sale of some of Berkshire’s ConocoPhillips shares in the quarter, and said the firm had divested an undisclosed number since June 30.
Berkshire said yesterday that the size of the stake had fallen 9.5 percent in the quarter. Buffett’s firm remains the oil producer’s second- largest shareholder, according to Bloomberg data.
A decline in the value of the ConocoPhillips holdings contributed to Berkshire’s worst quarterly loss in at least two decades in the first three months of 2009 as Buffett worked to recover from what he called his “major mistake” of buying shares with oil prices near their peak.
Berkshire said in a filing last week the sale of the securities at a loss may help recover $690 million in capital gains taxes paid in 2006.
American Express
The biggest holdings listed in Berkshire’s disclosure yesterday all rose in value in the second quarter. American Express Co. advanced 71 percent in the period.
Wells Fargo & Co. increased 70 percent, while Burlington Northern Santa Fe Corp. advanced 22 percent.
The firm’s single largest holding, Coca- Cola, climbed 9.2 percent.
Berkshire’s own shares passed $100,000 for the first time since January last week, recovering from a six-year low in March. The stock fell $750 to $101,400 yesterday.
Mutual funds and individual investors mimic the firm’s stock picks to duplicate Buffett’s investing success. An academic study in 2007 found that using this strategy for 31 years would have delivered annualized returns of about 25 percent, double the return of the Standard & Poor’s 500 Index.
Berkshire had also previously disclosed the sale of its stake in Constellation Energy Group Inc. Berkshire’s MidAmerican Energy Holdings Co. acquired the shares last year as part of a termination package when Constellation broke an agreement to sell itself to Buffett’s firm for $4.7 billion.
Yesterday’s filing lists equities traded on U.S. exchanges.
Buffett discloses other holdings in annual reports and filings with non-U.S. regulators.
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