Dillard’s shares rise more than 40% after Warren Buffett’s 6% stake reveals

Dillard’s shares rose 45% on Monday after one of Warren Buffett’s assistant investors revealed a personal stake in the struggling retailer.

According to the files of the Securities and Exchange Commission, Ted Weschler, who is an investment manager at Berkshire Hathaway, bought about 1.08 million shares of Dillard’s , or about 5.89% of the outstanding shares.

Dillard’s shares have dropped more than 40% this year amid weak sales. In the last quarter, however, the retailer reported a much smaller than expected quarterly loss, thanks to inventories and cost control measures. The recipe, however, was short.

Weschler, along with another Buffett protégé, Todd Combs, has been responsible in recent years for leading Berkshire to some winning bets in the technology sector.

Weschler joined Berkshire Hathaway in early 2012, after spending a total of $ 5.3 million on two meals with Buffett through Buffett’s annual “Power Lunch” charity auction.

This recovery on Monday added more than $ 390 million to the retailer’s market capitalization, bringing it to $ 1.3 billion.

The company’s net sales fell 41% year-over-year to $ 1.7 billion in the six months to 1 August, leading to a net loss of $ 171 million compared to $ 38 million in net income in the first half of 2019. Two of his peers, JCPenney and Neiman Marcus, filed for bankruptcy this year.

Dillard’s was also downgraded from the S&P 400 in June, when the S&P Dow Jones Indices officials responsible for the index said it “was no longer representative of the midcap market”.

Dillard’s, Inc. , is an American department store chain with approximately 282 stores in 29 states and headquartered in Little Rock, Arkansas. Currently, the largest number of stores are located in Florida with 42 and Texas with 57. The company also has stores in 27 more states; however, it is absent in the Northeast (Washington, DC and North), in most of the Upper Midwest (with no stores in Michigan, Chicago, Wisconsin or Minnesota), in the North West and in most of California, except in three smaller city stores.