Bill Gates Foundation Trust trims Berkshire stake, buys $352.7 million of Home Depot

BRK-B -0.21%

HD +0.33%

If there is one habit that stands out when watching markets, it is that the most important clues are not always found in the most crowded trades. Sometimes they appear in places investors overlook.

That appears to be the case here. The latest 13F filing from the Bill & Melinda Gates Foundation Trust shows a new $352.7 million position in The Home Depot (HD), while the trust reduced its Berkshire Hathaway stake by about $818 million.

The move is notable because it shifts capital from one of the market’s most iconic holdings into a home-improvement retailer. The trust now holds 1 million shares of The Home Depot, a meaningful initial position for a portfolio with $34.42 billion in managed 13F securities, according to WhaleWisdom.

The timing is also notable. The Home Depot recently reported its strongest comparable sales growth since 2022, even as its chief financial officer described the environment as one of “frozen housing market conditions.” That contrast helps explain why the name can attract attention even when the broader housing backdrop remains soft.

Why the Gates Trust reduced Berkshire and opened a Home Depot position

The Gates Foundation Trust’s portfolio is concentrated and deliberate. According to GuruFocus data, its top five holdings include Berkshire Hathaway Class B (BRK.B), Caterpillar (CAT), Canadian National Railway (CNI), Waste Management (WM), and Deere & Company (DE).

Those holdings reflect long-duration bets on infrastructure, industrial activity, and the broader U.S. economy.

The Home Depot fits that same framework. The company is the world’s largest home improvement retailer and is closely tied to the U.S. housing stock, according to The Home Depot. For a large institutional holder, that makes the business relevant not just to home sales, but also to the ongoing upkeep, repair, and refresh cycle that continues even when transactions slow.

The trust also opened a new position in FedEx Freight Holding Company (FDXF) worth approximately $180 million in the same quarter, according to the 13F filing.

Taken together, the filings suggest a rotation toward companies that benefit from domestic economic activity and the maintenance of physical assets rather than purely financial holdings.

Home Depot’s Q2 results help explain the timing

The Home Depot reported fiscal second-quarter 2026 results on Aug. 18 that topped expectations across the board.

• Net sales were $47.9 billion, up 5.7% year over year.
• Comparable sales rose 1.7%, the highest level since 2022.
• Adjusted diluted earnings per share were $4.92, up from $4.68 in the prior-year period.
• Net earnings were $4.8 billion, or $4.79 per diluted share.

Source: The Home Depot Q2 Earnings Results

In a CNBC interview, CFO Richard McPhail said: “We continue to operate in what I call frozen housing market conditions. But we also know that we're taking share and that we're serving our customers better every day.”

That point is central to the investment case. Home Depot’s comparable sales growth is not being driven by a housing rebound. Instead, it is being supported by smaller, non-discretionary repair and maintenance projects that homeowners pursue regardless of whether they are buying or selling.

When a roof leaks or a water heater fails, those items are replaced. Home Depot captures that spending whether mortgage rates are 3% or 7%.

The company also said it received $730 million in tariff refunds during the quarter and used $685 million to reduce cost of goods sold, according to McPhail’s comments on the earnings call.

Bank of America maintained a Buy rating

Bank of America analyst Christopher Nardone reiterated a Buy rating on Home Depot and lowered his price target slightly to $407 from $412, according to a note shared with TheStreet.

The lower target reflects Home Depot’s cautious, reaffirmed guidance rather than an increase in its outlook. Still, the Buy rating remained in place.

Home Depot’s fiscal 2026 guidance calls for total sales growth of 2.5% to 4.5% and comparable sales growth of flat to 2.0%, according to the company. Gross margin is projected at about 33.1%, while operating margin is expected to range from 12.4% to 12.6%.

McPhail described the customer as “a healthy cohort” with “the means to spend,” but said many shoppers remain hesitant as projects become larger, citing inflation, fuel costs, and general uncertainty in his CNBC interview.

Recent stock performance

HD shares were trading at $334.49 as of Aug. 20, down 1.41% year to date and 14.53% over the past year, according to Yahoo Finance.

That price was roughly $18 below where the Gates Foundation Trust opened its Home Depot position.

Bank of America’s $407 target implies about 22% upside from current levels. The Gates Foundation Trust appears to be buying Home Depot at a period of pressure in housing sentiment.

This story was originally published by TheStreet on Aug. 22, 2026, where it first appeared in the Investing section.