Investing legend Warren Buffett raised his Delta Air Lines stake by nearly a million shares amid the coronavirus stock market rout last week. Delta Air Lines stock reversed lower.
The Berkshire Hathaway chief acquired more than 976,000 Delta Air Lines shares for about $45.3 million, or an average price of $46.40, Bloomberg reported citing a regulatory filing.
Berkshire Hathaway's holding in Delta swelled to about 71.9 million shares with the Feb. 27 purchases. Buffett's Berkshire first bought Delta Air Lines stock in the third quarter of 2016.
The conglomerate also owns United Airlines (UAL), American Airlines (AAL) and Southwest Airlines (LUV), but Delta is its biggest position by number of shares and market value among airline stocks.
Warren Buffett Buys After Huge Sell-Off
Shares of Delta gave up earlier gains to close down 2% at 46.18 in stock market trading Tuesday. Other airline stocks also reversed lower, as United Airlines stock sold off 4.85%, American Airlines stock dropped 5.4% and Southwest Airlines stock lost 3.3%. JetBlue (JBLU) fell 3.6%. Berkshire B shares dropped 4%.
Delta stock plunged more than 20% last week to further undercut the 50-day moving average as the coronavirus spiraled beyond China and global markets sold off. Is Delta stock a buy now?
The relative strength line of Delta Air Lines stock has fallen sharply since the coronavirus outbreak, after moving sideways for months. The RS line, tracking a stock's performance against the S&P 500, is the blue line in the chart shown.
While airline stocks are up on the Warren Buffett news, they still face the risk of longer-term headwinds to travel demand overall.
At the end of January, airline companies Delta, United and American Airlines suspended flights between the U.S. and China. That came after a pilots union claimed American Airlines was slow response to the crisis and sued the company.
The Delta purchase also comes as Buffett has had trouble finding other places to put his money. The notorious bargain hunter has avoided large M&As and instead repurchased Berkshire Hathaway stock in Q4.
Buffett bought shares of Kroger and Biogen in Q4, but the investing legend further pared his Apple and Wells Fargo stakes.
This article originally appeared on Yahoo! Finance.
