Berkshire Hathaway revealed a new $55 million position in Macy's, buying roughly 3 million shares in the first quarter. The disclosure sent shares of the struggling retailer up nearly 6% in after-hours trading.
The stake is a tiny fraction of Berkshire's $300 billion-plus equity portfolio, but it signals that the conglomerate sees value where others don't.
Macy's has been restructuring: closing underperforming stores and trying to unlock value from its extensive real estate holdings, including its flagship Herald Square location. The bet may have been placed by Berkshire lieutenants Ted Weschler or Todd Combs, not Warren Buffett himself, given the relatively small size.
The 13F filing reflects positions as of March 31, so Berkshire's purchase price may differ from today's. For the average investor, the calculus is vastly different: a total loss on a $55 million position would barely dent Berkshire's income. Concentrating a significant chunk of your portfolio in Macy's is a much riskier bet.
Worth watching: whether Berkshire adds to the stake in future quarters, a question the next 13F filing will answer.