Berkshire Hathaway has reported the purchase of a stake valued at $3.7 in Exxon Mobil Corp. The company, owned by Warren Buffett, disclosed its largest holding since 2011.
The company owned as of September 30, 40.1 million Exxon shares it announced on Thursday, in one of its regulatory filings.
The largest oil company in the world by market share was up 0.9% on Thursday to $94.07 in afterhours trading, following the disclosure.
Berkshire has enjoyed an up year as its picks of stocks have rallied along with the market in general, affirming its strategy of equities over bonds amid interest rates at near record lows.
Buffet, who is 83, tracked Exxon and bought stock in the company in the past. He held a stake in 2011 in the company based in Irving, Texas,
In Buffet’s opinion Exxon is undervalued and for the most part ignored by the financial markets, said a Wall Street analyst.
This year Exxon is up 7.7% through Thursday’s trading, trailing the surge of 26% in the S&P 500 Index.
Berkshire requested confidential treatment in a document in August that detailed its portfolio when the second quarter ended.
The SEC at times allows businesses to withhold certain information from the public in order to discourage copycat investing. Nearly 75% of the Exxon stake was added prior to the end of the second quarter on June 30.
Exxon has roots back to John Rockefeller and the 1880s with the Standard Oil Trust. It is amongst the most efficient explorers when taking into account the major energy producers around the globe. Last year, the company spent $19.27 to fund one barrel of crude. That is compared to $21.48 for Chevron and $22.66 for BP of London.
Natural gas and oil production was boosted by 1.5% by Exxon during its third quarter, reversing its 24-month stretch of declines in output. Net income for the third quarter was down by 18% to end the quarter at $7.87 billion as increasing crude prices squeezed margins at the refineries of Exxon.
Buffet, the CEO and Chairman at Berkshire for over four decades, has been successful as well as unsuccessful in betting on energy.