Warren Buffett is on a shopping spree! The stock market has taken quite a beating these past few months. But the ‘Oracle of Omaha’ often tells us to “be greedy when others are fearful”. So it’s hardly a surprise to see him start using his multi-billion-dollar cash pile.
In fact, according to Bloomberg, this is the most active he’s been since 2008! With that in mind, let’s explore some of the potentially best UK shares to buy right now for my portfolio.
Warren Buffett just invested $51bn
Following the release of Berkshire Hathaway‘s first-quarter report, a total of $51bn has been invested into the stock market by the firm. That’s undoubtedly a lot of money. But it’s worth noting that Buffett still has $106bn of cash at his disposal. So what did he buy?
Berkshire Hathaway has made several big purchases in the last three months, with the most prominent being in oil, insurance, and video games. The first two aren’t exactly surprising. Berkshire already has substantial stakes in both industries. So seeing an increased position in Chevron, Occidental, and Alleghany was somewhat predictable.
What I find more interesting is the $5.6bn stake Buffett just took in Activision Blizzard. The video game developer has faced quite a few misconduct allegations in the past year, for which the stock got pummelled. But following this decline, it seems Microsoft took advantage and made a $68.7bn acquisition offer, which the video game developer couldn’t refuse.
Today, there’s a roughly 10% difference between the offer price and the current share price. And it seems Buffett is making an arbitrage merger play. As he puts it: “If the deal goes through, we make some money, and if it doesn’t go through, who knows.” It’s a risky move for sure, but it’s not an unreasonable investment to make. At least, that’s what I think.
Best UK shares to buy now?
The UK stock market is not exactly short on big oil businesses similar to what Buffett just bought. I’ve looked at BP numerous times, intrigued by management’s strategy to transition into renewable energy.
But a weakness many of these UK stocks share is exposure to Russia. And while BP’s leadership has made aggressive moves to eliminate this exposure, its production capabilities may have been partially compromised as a result.
The land of insurance looks more promising for discovering one of the best UK shares to buy now. Aviva is probably the most well-known in this space, serving over 18m customers. With car, home, life, health and other insurance products available, the group has a diverse portfolio on offer. But an insurance company’s bottom line can be quite wobbly. And Aviva doesn’t exactly scream ‘growth opportunity’, in my opinion.
However, venturing into the video game space, Frontier Developments might be one of the best UK shares to buy now. Despite receiving critical acclaim, the stock price took a nose dive on disappointing post-launch sales of its latest game Jurassic World Evolution 2.
However, with the new Jurassic World movie coming out soon, a surge in sales could be on the horizon. Needless to say, this could be enough to push the share price significantly higher. And that’s why, out of these three UK shares, I think Frontier is the best one to buy now.