Warren Buffet's investment firm Berkshire Hathaway increases holdings in Tesco to 5.08% from 3.21% despite company's warning that its trading profit in 2012-2013 would likely be flat
January 23, 2012
– According to a regulatory filing that showed on Jan. 19, Warren Buffet’s investment firm Berkshire Hathaway Inc. has increased its holdings in Tesco Plc. from 3.21% to 5.08% in the wake of a profit warning predicting that Tesco’s trading profit in 2012-2013 would most likely be flat, The Guardian reported the same day.
On January 12, Tesco’s stock prices fell by as much as 19%.
Earlier in the day on Jan 19., Tesco’s shares dropped in the wake of a negative note from Goldman Sachs Group Inc.
According to the note, there are likely to be further pressures on the profitability of the U.K. grocery market.
It predicted that supermarkets would either have to cut back on their expansion plans or that competition would intensify with potential price wars and no decrease in the pace of new store openings, with the second option being more likely than the former.
The primary source of this article is The Guardian, London, England, on Jan. 19, 2012.