Warren Buffett's Berkshire Hathaway Sells $116M Shares Of Dialysis Giant DaVita, Cuts Stake By 2%

Warren Buffett‘s investment firm, Berkshire Hathaway BRK BRK, has offloaded a 2% stake in dialysis service provider, DaVita Inc. DVA. The transaction, executed between February 14 and 19, is valued at around $116 million.

What Happened: A Form 4 filing with the U.S. Securities and Exchange Commission (SEC) on Wednesday night revealed that Berkshire Hathaway sold 750,000 DaVita shares, in multiple batches, bringing its stake in the company down to 35.14 million shares, or approximately 44%. This follows a previous sale of 203,091 shares on February 11, which reduced Berkshire’s ownership to 45%.

The latest transaction is categorized as an insider trade, differing from the earlier trade related to a share buyback agreement. These sales are a part of Berkshire’s continuous portfolio management approach, but the real reason behind the sale has not been disclosed.

Despite the recent sales, the Buffet-led company continues to be a majority owner of DaVita, holding 35.14 million shares worth approximately $5.4 billion. According to Reuters, Berkshire has been a DaVita investor since the last quarter of 2011.

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Why It Matters: The recent sale of DaVita shares by Berkshire Hathaway follows a previous sale on February 11 which brought Berkshire’s stake in the company down to 45%.

On February 14, DaVita's stock price dropped over 11% following the company’s earnings beat but a disappointing outlook for Fiscal 2025. The company projected full-year EPS between $10.20 and $11.30, falling short of the analysts’ average expectation of $11.44.  

Shortage of intravenous fluid, elevated mortality rates, and regulatory changes are some of the challenges that the company has been grappling with recently. Javier Rodriquez, CEO of DaVita acknowledged the challenges and stated, “Despite a year with unique hurdles, we finished strong in 2024, producing full year adjusted operating income and adjusted EPS in the top half of our guidance range.”

Meanwhile, according to StreetInsider, Bernstein SocGen Group analyst Lisa Bedell Clive stated ‘We View the Results as Negative’. She reinforced a ‘Market Perform’ rating and a price target of $184.00 on DaVita stock.

That said, the shares of the kidney dialysis provider surged more than 20% over the past 12 months.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.