UnitedHealth shares rose as much as 10% in trading today.
Warren Buffett's Berkshire Hathaway Inc. bought shares of UnitedHealth Group Inc. in the second quarter, sending the health insurer's stock soaring in after-hours trading.
The CEO of the Omaha, Nebraska-based conglomerate acquired 5 million shares of UnitedHealth, giving Berkshire a stake worth $1.6 billion, according to a filing Thursday. Berkshire also sold its $1 billion stake in T-Mobile US Inc. during the period, exiting the telecommunications operator.
Buffett's investment in UnitedHealth comes at a time when the healthcare company is facing multiple crises. Last year, a UnitedHealth executive, Brian Thompson, was shot and killed in Manhattan.
UnitedHealth, along with other US health insurers, has also faced unexpected increases in medical costs. In April, its profits fell below Wall Street estimates for the first time in more than a decade, sending its stock price plummeting. It has since replaced its CEO and announced plans to replace its CFO.
The revelation of Berkshire's stake in UnitedHealth sent the insurer's shares up as much as 9.6% in after-market trading Thursday.
Apple also suffered cuts
Buffett also sold 20 million shares of Apple Inc. during the period, after reducing his stake in the iPhone maker last year. Berkshire's stake in Apple remains its largest by market value, despite shrinking by about $9.2 billion in the three months ended June 30.
Berkshire also resumed its efforts to reduce its stake in Bank of America Corp. by selling 26 million shares and reducing its stake to about 8% by the end of June. Buffett began reducing his investment in the bank last year, without giving any explanation.
One of his stock bets, a stake in the consumer food giant Kraft Heinz Co., has been a headache for Buffett's company. Earlier this year, the conglomerate faced a $3.8 billion write-down on its investment, but kept its stake unchanged in the second quarter.
Meanwhile, Berkshire adjusted its investment in U.S. homebuilders, increasing its stake in Lennar Corp. and selling shares of DR Horton Inc. The company also bought more shares of steelmaker Nucor Corp. These changes were omitted from an earlier filing because the company requested confidentiality treatment from the Securities and Exchange Commission.