BYD Co. Ltd (OTC: BYDDF) is a Chinese EV manufacturer, that is most renowned for being a Warren Buffett-backed company, in which Berkshire Hathaway owns nearly a 20% stake. Following a series of share selloffs by Berkshire Hathaway, prices of BYDDF continue tanking downwards in the panic about future prospects.
BYDDF Stock Selloff
BYD Co. saw its share prices take a dive today in a fall exceeding 7%, putting its losses at nearly 20% for the week. This comes after a disclosure that Berkshire Hathaway has sold another round of shares in the company during the same week. In total, Berkshire Hathaway this week has unloaded a total of 1.4% of its holdings in the company in the last few days, as per regulatory filings disclosed. Despite this, however, Buffett’s company still holds close to a 19% stake in the company. As a result, BYDDF remains very much a Buffett-backed EV company. Investors are likely to keep a keen eye on whether the stake further lowers in the coming days, which could trigger an even sharper selloff in the market.
Strong Performance Updates
On the other hand, the company released exceptionally incredible sales results today, reporting a year-on-year sales growth of a whopping 222%. It also states that it holds a backlog of 700,000 orders, while wait time is down to as low as 4 months. These extraordinary positive updates give mixed signals and indicate that Berkshire Hathaway could possibly reverse its decision after these updates. However, it may also be possible that the investment kingpin foresees broader sustainability issues beyond immediate performance.
It may well just be too soon to know the fate of BYDDF, especially given the mixed news circulating the market. However, at present, the selloff continues, given the market’s trust in the stance of Warren Buffett regarding the prospects of the stock.