Opinion may well be divided on the prospects for Wells Fargo & Co., but Warren Buffett apparently has no doubts.
The legendary investor has lifted his stake in the San Francisco-based company to 10.75% from 9.7%, according to a regulatory filing on Wednesday.
Mr. Buffett paid $41.5 million for 613,500 Wells shares, with most bought in the first week of August, the filing said.
Vote of Confidence
Considering the weakness in Wells' stock price, the purchases were viewed as a vote of confidence in the company.
Worries about the protracted recession in California plus disappointing second-quarter results at Wells have pushed its shares down by 25% from their peak of $86.375 on May 11. Analysts have been widely split over whether Wells will rebound strongly from problem real estate loans.
The news of Mr. Buffett's purchases helped the stock on Wednesday. In late afternoon trading it was up $1.50, to $69.75. Mr. Buffett bought the stock at prices ranging from $66.80 to $68.22 a share.
Mr. Buffett began acquiring the bank stock two years ago through Berkshire Hathaway Inc., the Omaha-based company he controls.