Warren Buffett's Berkshire Hathaway Inc. (NYSE:BRK) (NYSE:BRK) has cut its stake in the dialysis provide DaVita Inc. (NYSE:DVA) according to a U.S. Securities Exchange Commission filing.

What Happened: According to the SEC filing, Buffett‘s Berkshire sold 203,091 shares of DaVita on Feb 11. Based on the stock's Thursday closing price, the transaction was valued at $35.96 million. Berkshire now owns about 35.892 million shares in the company representing a 45% stake abiding by its earlier share repurchase agreement.

According to Reuters, Berkshire has owned DaVita since the fourth quarter of 2011.

DaVita reported its full-year and fourth-quarter earnings after markets closed on Thursday. For the year ending Dec. 31, 2024, the company reported consolidated revenue of $12.8 billion, with $3.3 billion generated in the fourth quarter beating Benzinga Pro estimate of $3.27 billion.

Diluted earnings per share were $3.09 for the quarter and $10.73 for the year, while adjusted diluted earnings per share were $2.24, beating estimates of $2.14 for the quarter.

The company repurchased 2.3 million shares in the fourth quarter at an average price of $156.46 per share, and 9.8 million shares for the full year at an average price of $140.06 per share.

Why It Matters: As previously reported in a Form 8-K filed on May 1, 2024, DaVita entered into a Share Repurchase Agreement with Berkshire, the company's largest stockholder, as of April 30, 2024.

Under the agreement, if Berkshire owns at least 45% of DaVita's stock, DaVita will buy back shares from Berkshire quarterly to maintain Berkshire’s ownership at 45%.

The 2024 filing stated that if Berkshire's ownership exceeds 49.5%, DaVita will repurchase shares immediately. Additionally, Berkshire agreed to vote any shares it owns above 40% according to DaVita's board recommendations.

This agreement does not change the existing Amended Standstill Agreement. Thus, DaVita repurchased its shares to bring back Berkshire’s holdings to 45% on Feb. 11, ahead of its on Feb. 13.

Price Action: DaVita shares gained 2.94% on Thursday, reaching $177.06 per share, but dropped 6.87% in after-hours trading as the company provided a weak outlook for 2025. DaVita projected a full-year EPS of $10.20 to $11.30, falling short of Wall Street's expectation of $11.44 per share.

The exchange-traded fund tracking the S&P 500 index, SPDR S&P 500 ETF Trust (NYSE:SPY) rose 1.06% on Thursday. DVA has risen 18.18% year-to-date, whereas it gained 43.47% over the last year.

The average price target among nine analysts tracked by Benzinga is $138.33 with a ‘sell’ rating. The estimates range from $90 to $175 apiece. Recent ratings from Barclays, Truist Securities, and Truist Securities suggest a $168 target, implying a potential upside of 1.89%.

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