LAGUNA NIGUEL, Calif. Billionaire investor Warren Buffett is not concerned by the sharp drop in Bank of America Corp shares in the last couple of days, despite his $5 billion investment in the company last month, he told Reuters on Tuesday.
"We agreed to hold it for at least five years, so what I'm thinking about is where Bank of America will be in five years, and nothing in the last 24 hours or 48 hours has changed my views on that," the Berkshire Hathaway Inc chief executive told Reuters on the sidelines of Fortune magazine's Most Powerful Women Summit.
Buffett made his bet on Bank of America's survival in late August (though it closed in early September). The deal gave him preferred shares with a hefty dividend and warrants that represent 6.5 percent of Bank of America stock.
Bank of America shares fell 5.2 percent to $5.24 in late-afternoon trading. The stock rose 33 percent in the five days after Buffett's investment was announced but since that peak has now fallen 37 percent.
Earlier on Tuesday, Buffett told the Fortune summit that many of Berkshire Hathaway's businesses would post record profits this year, including railroad unit Burlington Northern and energy business MidAmerican.
But he was much less optimistic about the company's housing-related businesses, including Shaw Carpet and Acme Brick.
Buffett told his long-time friend Carol Loomis, who interviewed him in front of an audience of America's most important female executives, that the performance of the housing-related units was as bad as it has ever been.
Berkshire's widely traded Class B shares rose 0.2 percent in late trading, one of the few gainers on a weak day in the broader market.
(Reporting by Lisa Richwine in Los Angeles, Writing by Ben Berkowitz in New York; Editing by Gerald E. McCormick and Steve Orlofsky)
Trending On Reuters
India's top energy explorer Oil and Natural Gas Corp said on Thursday it expects current-quarter profit to be boosted by an interim rule change on discounts offered by upstream oil companies to state retailers. Full Article