Warren Buffett's Berkshire Hathaway (ticker: BRK.A, BRK.B) shed $900 million in Wal-Mart Stores Inc (WMT) stock, reports Business Insider, echoing larger issues the retail industry is facing against fierce competition like Amazon.com (AMZN).
Buffett has shifted focus – i.e. billions of dollars – toward airline stocks instead, like Southwest Airlines (LUV) and Delta Air Lines (DAL). He also increased shares in Bank of New York Mellon (BK), among other purchases.
STOCK PRICE FOR WMT
The billionaire investor retains practically zero shares in the legacy retailer Wal-Mart, which has a market capitalization of $298 billion. The company's shares decreased 21 percent from the end of 2014, as opposed to Amazon's 119 percent growth. Buffett purchased shares in the company for the first time in 2005.
Wal-Mart arrived late to the e-commerce game, a factor still evident today. Its online sales hit $13.7 billion in 2015 while Amazon's were $107 billion.
Business Insider notes Buffett foresaw the retail industry issues in 2005, specifically the problems facing Sears and Kmart (SHLD).
"Retailing is like shooting at a moving target," Buffett said. "Turning around a retailer that has been slipping for a long time would be very difficult. Can you think of an example of a retailer that was successfully turned around?"
Sears has struggled, shuttering hundreds of stores, as have retailers such as Macy's (M) and JCPenney Co. (JCP). Earlier this year, some Twitter users were surprised to learn Kmart was still around at all.
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