Buffett Dumps More Moody's Stock

Before you go, we thought you'd like these...
Before you go close icon
Warren Buffett seems to think less and less of the credit-rating business. His company, Berkshire Hathaway (BRK.A), sold more shares of Moody's (MCO) on Dec. 22. An SEC filing showed the sale of 87,992 shares a few days earlier. Bloomberg reports that this is the sixth sales since Buffett bought a big piece of Moody's in July.%%DynaPub-Enhancement class="enhancement contentType-HTML Content fragmentId-1 payloadId-61603 alignment-right size-small"%%Is it any wonder that Buffett wants out? Moody's stock is up by about 5% over the last six months compared with a 25% increase in the DJIA. Congress has been talking about heavily regulating the credit-ratings companies after they missed the dangers of mortgage-backed securities. There were claims that Moody's and S&P's ratings were influenced by the size of customer payments.

Moody's is also facing more competition. Companies, including stock and mutual fund-rating firm Morningstar, are using the problems with Moody's reputation to move into the industry. Moody's profits have also been under pressure and net income dropped to $100 million in the third quarter, compared to $113 million in the same period a year ago.

Moody's might survive the blow to its reputation and its earnings problems, but stock sales by Buffett are often considered a kiss of death.
Read Full Story

Markets

S&P 500 2,263.40 -7.91 -0.35%
DJIA 19,785.09 -42.16 -0.21%
NASDAQ 5,548.11 -7.23 -0.13%
DAX 11,545.75 -84.38 -0.73%
HANG SENG 22,898.52 12.61 0.06%
NIKKEI 225 18,891.03 -246.88 -1.29%
USD (per EUR) 1.07 0.00 0.33%
USD (per CHF) 1.00 0.00 -0.25%
JPY (per USD) 113.00 -0.81 -0.71%
GBP (per USD) 1.25 0.01 0.97%

From Our Partners