Buffett’s Silence on BYD Fuels Trader Theories on His Next Move
What is Warren Buffett doing with Berkshire Hathaway Inc.’s $8 billion stake in BYD Co.?
The question is still swirling across trading desks more than a week after a BYD position matching the size of Berkshire’s appeared in Hong Kong’s stock-market clearing system.
While traders initially assumed Buffett was preparing to dump his stake in the high-flying Chinese electric car giant, now they’re not so sure.
With no clear signs that Buffett has exited BYD, other theories are starting to make the rounds. Maybe the 91-year-old billionaire is lending shares to short sellers for extra income, or simply wants to see how the market will respond to the idea of him selling. Or maybe there’s some other back-office explanation that has nothing at all to do with Buffett’s plans for the stock.
The Oracle of Omaha has been characteristically tight-lipped about his intentions, with multiple requests for comment to Berkshire as well as BYD representatives going unanswered. The upshot for now is that BYD’s stock is languishing: it’s down about 7% since fears of a Berkshire exit first emerged, even after the carmaker said its net income probably jumped as much as 207% in the first half. Hong Kong’s benchmark Hang Seng Index has slipped 2.6% in the same period.