Warren Buffett's deputy cashed in his almost 6% stake in Dillard's — and probably made at least a 5x return

• Warren Buffett's deputy sold his Dillard's stock last year, likely making at least a 5x return.
• Ted Weschler, who disclosed a 5.9% stake in October 2020, revealed he sold the position in 2021.

Warren Buffett's deputy cashed out his personal stake in department-store chain Dillard's last year, likely scoring at least a five-fold return in under 15 months.

Ted Weschler is one of Buffett's two investment managers, who help the famed investor oversee Berkshire Hathaway's $330 billion stock portfolio. Weschler disclosed a 5.9% stake in Dillard's in October 2020, but sold all of his 1.1 million shares by the end of 2021, a Securities and Exchange Commission filing revealed this week.

Dillard's stock price closed at $34 on September 29, 2020 — the date when Weschler crossed the 5% ownership threshold and was legally required to disclose his stake, worth $36 million at the time.

The department-store chain's shares promptly skyrocketed to hit a record intraday high of $417 in November 2021, as retail investors snapped them up in an effort to squeeze the hedge funds shorting the stock.

Weschler received anywhere between $58 million and $450 million from his share sales, representing a return of 60% to 1,200%, based on the trading range of Dillard's stock last year.

If he sold at the average closing price of $167, he pocketed $180 million — a roughly 400% return, if a cost base of $34 is assumed.

The former hedge-fund manager joined Berkshire in 2012 after shelling out $5 million to win Buffett's annual charity-lunch auctions in 2010 and 2011. Weschler is best known for snowballing his retirement fund from $70,000 to $264 million in less than 30 years — a 377,000% gain.

Notably, the investor converted his retirement account into a Roth IRA in 2012, meaning he can withdraw its contents without paying any taxes. He became eligible to cash out the fund in November, six months before his 60th birthday in May this year.

It's unclear whether Weschler sold his Dillard's shares as part of his retirement planning, or simply decided to pocket their massive increase in value last year. Either way, Dillard's stock price is down 40% from its peak, and has barely budged this year, so the investor probably doesn't regret taking his money off the table.