Warren Buffett’s Berkshire Hathaway (BRK.A) (BRK.B) has further reduced its stake in Bank of America’s (BAC) stock. According to the SEC filing, Berkshire sold an additional 14 million shares between August 15 and August 19. With this move, Berkshire has lowered its stake in BAC stock to 12%.
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Since late July, Berkshire has significantly lowered its investment in BAC. On July 29, it disclosed the sale of over 18 million shares of BAC at average prices ranging from $41.19 to $42.29 each. These divestments align with Buffett’s decision to reduce Berkshire’s exposure to the banking sector, as evidenced by the divestment of positions in other banks, including Wells Fargo (WFC), U.S. Bancorp (USB), and Bank of New York Mellon (BK) in recent years.
The full extent of Berkshire’s exit from BAC remains unclear. Since owning less than 10% could exempt Berkshire from stricter reporting requirements, there is potential for further reductions or even a complete exit from the bank.
Is BAC a Good Buy Right Now?
Bank of America’s bottom line has remained under pressure due to higher deposit costs and a slowdown in loan growth. However, analysts remain cautiously optimistic about BAC stock, supported by rising hopes of interest rate cuts this year, which could boost the bank’s profitability.
BAC has a Moderate Buy consensus rating on TipRanks. This is based on 11 Buy, six Hold, and one Sell recommendations. Analysts’ average price target on Bank of America stock is $45.65, implying a 15.07% upside potential from current levels. The stock gained 18.4% in the past six months.
