Uncovering Undervalued Dividend Stocks in Berkshire Hathaway's Portfolio

The author identifies two dividend stock bargains in Berkshire Hathaway's portfolio. They argue that the market could be forming a top and suggests selling into strength, but sees opportunities in certain sectors and select stocks.

Berkshire Hathaway, under the stewardship of Warren Buffett, continues to make strategic investments in various sectors, reflecting the company's long-term growth strategy. Recent portfolio shifts include significant investments in Nucor and partial divestments in Apple. This article explores these moves and suggests potential dividend stock bargains in Berkshire's portfolio.

Nucor: A Dividend Stock Bargain

Nucor Corporation (NUE), a leading steelmaker, has seen a substantial investment from Berkshire Hathaway, with the company increasing its stake to over $857 million by the end of Q2 2025 [3]. Nucor's 52-year dividend streak and strategic focus on electric arc furnaces and recycled scrap metal position it as a leader in the steel sector. With steel prices rising and infrastructure demand growing, Nucor is poised to deliver earnings growth and share price appreciation. The stock's low valuation and durable dividend make it an attractive option for income-seeking investors.

Apple: A Potential Sell Signal

Conversely, Berkshire Hathaway has divested a portion of its Apple stake, reducing its holdings to $64 billion. This move, which reflects concerns over Apple's valuation, slowing growth, and potential future tax policy shifts, suggests a potential top in the stock's price [3]. While Apple remains a significant holding, the divestment could signal a strategic shift in Berkshire's portfolio.

Market Sentiment and Sector Opportunities

The market's recent optimism is reflected in Nucor's stock performance, with a 0.87% increase following Berkshire's investment disclosure [1]. However, the broader market sentiment remains cautious, with Berkshire Hathaway Class B (BRK.B) experiencing a 46.13% drop in trading volume to $2.17 billion on August 27, 2025 [3]. This volatility underscores the potential for market corrections and presents opportunities for strategic portfolio adjustments.

Conclusion

Berkshire Hathaway's investments in Nucor and divestments in Apple highlight the company's long-term growth strategy and sector-specific opportunities. While Nucor presents a potential dividend stock bargain, investors should monitor market sentiment and regulatory developments. The market's recent volatility suggests potential selling opportunities, but sector-specific momentum, such as the housing recovery and infrastructure demand, could drive further investment. As always, investors should conduct thorough due diligence and consider their risk tolerance before making any investment decisions.

References:

[1] https://www.ainvest.com/news/berkshire-hathaway-invests-1-8-billion-nucor-dividend-king-52-year-record-annual-dividend-increases-2508/
[2] https://www.morningstar.com/news/dow-jones/202508284250/dow-jones-top-financial-services-headlines-at-7-am-et-berkshire-hathaway-raises-stake-in-mitsubishi-net-zero
[3] https://www.ainvest.com/news/berkshire-hathaway-class-stock-plunges-trading-volume-26th-market-strategic-portfolio-shifts-nucor-bet-2508/