Buffett's $ATVI stake is up 30%. What happens next?

When Warren Buffett acts, it pays to pay attention. Together with Charlie Munger, Buffett’s Berkshire Hathaway has compounded returns over a 57 year period at 19.8% vs. 9.9% for the S&P. That is not a typo. Throughout 2022, the Oracle of Omaha and his team built a sizable stake in Activision Blizzard worth nearly 10% of the entire company. As of Berkshire’s most recent 13F, that stake still sits at a hefty 6.3% of common shares with this position representing Berkshire’s 12th largest holding.

What did Uncle Warren see in this company and its somewhat precarious workplace culture? Here we’ll dig into the gaming content player, its proposed sale to Microsoft and how Buffett won the trade… again.

The “Oracle of Omaha” previously revealed that one of his investing apprentices, Ted Weschler and Todd Combs, first bought ATVI 0.00%↑ in October and November 2021 for $77/share. He has since added to the holding in a merger arbitrage play, betting that Microsoft’s proposed acquisition of the video game company would close.

Well looks like he was right. Last week a Judge struck down the effort blocking the deal, and the stock soared 11%.

Now the question remains, where can it go from here? We dive into more below 🤝

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