Berkshire Hathaway Doubles Stake in Constellation Brands, Divests from Citigroup

Warren Buffett, through his investment vehicle Berkshire Hathaway, has made a notable shift in its investment strategy. The latest 13-F filing from Berkshire Hathaway reveals that the company has doubled its stake in Constellation Brands, the owner of popular beer brands Modelo and Corona. This move comes as Berkshire Hathaway has decided to divest from its holdings in Citigroup, a major financial institution. The decision to increase its stake in Constellation Brands while reducing exposure to financials indicates a strategic pivot towards more consumer-focused and recreational industries.

The divestment from Citigroup is part of a broader trend of Berkshire Hathaway reducing its financial holdings. In the first quarter of 2025, the company sold over 14.6 million shares of Citigroup and reduced its stake in Bank of America by 48.6 million shares. This move aligns with Buffett's historical preference for investing in companies with strong consumer brands and stable cash flows, rather than those in the volatile financial sector.

Constellation Brands, known for its wine and spirits portfolio, has been a consistent performer in the beverage industry. The company's strong brand recognition and diversified product offerings make it an attractive investment for Berkshire Hathaway. By doubling its stake in Constellation Brands, Berkshire Hathaway is positioning itself to benefit from the growing demand for premium alcoholic beverages.

The decision to divest from financial institutions like Citigroup and Bank of America reflects a strategic shift in Berkshire Hathaway's investment philosophy. Buffett has long been critical of the financial sector, often referring to it as a high-risk, low-reward area. By reducing its exposure to financials, Berkshire Hathaway is focusing on industries that offer more stable returns and are less susceptible to market volatility.

The move to increase its stake in Constellation Brands also highlights Berkshire Hathaway's interest in the consumer goods sector. The company has a history of investing in well-established consumer brands, such as Coca-Cola and Kraft Heinz. These investments have proven to be lucrative over the long term, providing Berkshire Hathaway with steady cash flows and capital appreciation.

In addition to its investments in Constellation Brands, Berkshire Hathaway has also divested from its holdings in Nubank, a Brazil-based digital bank that offers crypto trading services. The company sold its entire stake in Nubank over the course of a year, gaining approximately $250 million from the divestment. This move is consistent with Buffett's long-standing skepticism towards cryptocurrencies, which he has described as "rat poison squared" and a "gambling token."

Overall, Berkshire Hathaway's recent investment moves reflect a strategic shift towards consumer-focused and recreational industries, while reducing exposure to the volatile financial sector. By doubling its stake in Constellation Brands and divesting from financial institutions like Citigroup and Nubank, Berkshire Hathaway is positioning itself to benefit from the growing demand for premium alcoholic beverages and other consumer goods. This strategic pivot is consistent with Buffett's investment philosophy, which emphasizes long-term value creation and risk management.