Warren Buffett’s investment firm, Berkshire Hathaway, has made a significant move by investing $459 million in Sirius XM. This investment comes after Buffett sold stakes in major banks like Bank of America, JPMorgan Chase, and Wells Fargo. Berkshire Hathaway acquired approximately 20 million shares of Sirius XM between the third quarter of 2024 and the first quarter of 2025.
The purchase was made at an average price of $22.95 per share, bringing Berkshire’s total holdings in Sirius XM to nearly 120 million shares, valued at around $2.9 billion. This investment represents an effort to capitalize on a dip in Sirius XM’s stock, which has dropped about 45% from its 52-week high of $41.60 to $24.29. Despite recent financial challenges, including a 4% revenue drop in the first quarter of 2025 and ongoing subscriber losses in the second quarter, Sirius XM’s strong brand and recurring revenue model likely offer long-term value to Buffett.
Buffett’s decision to invest in Sirius XM follows his consistent offloading of shares from Bank of America, freeing up a significant cash reserve for new investments.
Buffett shifts focus to Sirius XM
The shift in Buffett’s investment strategy underscores his confidence in Sirius XM’s long-term potential, despite its recent financial setbacks.
The investment in Sirius XM aligns with Buffett’s investment philosophy of buying stocks with solid fundamentals at a discount. Moreover, the offloading of shares from major banks suggests a potential shift in Buffett’s view on the banking sector, which could signal a broader trend among investors reassessing their positions in these banks. Sirius XM, known for its wide array of programming including music, news, sports, talk, and comedy, offers a 5.2% dividend yield, adding to its appeal for income-focused investors like Buffett.
The company’s strong brand and recurring revenue model present long-term value, despite facing financial challenges in recent quarters. Berkshire Hathaway’s substantial stake in Sirius XM, accounting for more than 35% of the company’s outstanding shares, underscores Buffett’s confidence in the company’s potential for recovery and growth. This move is expected to have a positive impact on Sirius XM’s market position, attracting other investors and enhancing the company’s credibility.
