Warren Buffett Just Took a Multi-Billion-Dollar Writedown on One of Berkshire Hathaway's Longtime Holdings and Is Now Piling Into a Deep Value Opportunity With a 5% Yield

Core Insights - Berkshire Hathaway is preparing to exit its investment in Kraft Heinz while increasing its stake in Sirius XM, indicating a shift in investment strategy [1][10]. Group 1: Kraft Heinz Investment - Berkshire Hathaway's investment in Kraft Heinz has been problematic, marked by high debt and weak growth, leading to a nearly $5 billion writedown in Q2 [2][5][7]. - Berkshire owns 27.5% of Kraft Heinz's outstanding shares and has indicated a potential exit strategy, especially after its representatives left the board [6][9]. - The company is exploring strategic alternatives, including a possible breakup to focus on its faster-growing condiments division [6][9]. Group 2: Sirius XM Investment - Berkshire has recently invested over $100 million in Sirius XM, increasing its total position to $2.6 billion, which represents approximately 37% of outstanding shares [10]. - Despite a 65% decline in Sirius XM's stock over the past five years, the company is implementing strategies to rejuvenate subscriber growth, including exclusive podcast rights and technology updates [11][13]. - Sirius XM aims to grow its subscriber base to 50 million and increase free cash flow to $1.8 billion, with a current dividend yield exceeding 5% [13][14].