Warren Buffett's Berkshire Hathaway (BRK.A  ) revealed that it had taken an 11% stake in HP (HPQ  ) which sent shares higher by nearly 16% and new 52-week highs for the company. In total, Berkshire purchased 121 million shares, meaning the investment is worth $4.2 billion, following the stock's gain which now puts his investment in the black by $630 million.

For the last few years, HP has been a major underperformer as the PC and equipment maker has fallen into the 'tech value trap' with stocks like Cisco (CSCO  ), Intel (INTC  ), and IBM (IBM  ). These were stocks that were high-flyers and innovative at one time but now is considered 'old tech' as they are no longer at the edge of innovation.

That doesn't mean they aren't good businesses but simply not appealing to tech investors who are typically focused on growth. However, this has been a market where value has outperformed growth. Further, recent strength in tech sales and the market's disinterest in these specific stocks mean that valuations have continued to improve.

Currently, HP has a forward P/E of 8.7 which is more than 50% below the S&P 500's (SPY  ) average. It also pays a 2.6% dividend yield which is twice that of the S&P 500 and above the 10-year yield. The company also has no debt. Boring businesses that are consistently profitable become more appealing in inflationary and volatile market environments.

This also continues Buffett's streak of investing more in technology, and it seems that he is starting to deploy more of his record cash haul after not doing much for much of the pandemic. Last month, Berkshire bought the insurance company Alleghany for $11.6 billion. The company has also been adding to its already large Occidental Petroleum stake (OXY  ).

After largely sitting on the sidelines in the early days of the COVID pandemic, Berkshire has become more active in recent months. The conglomerate announced a deal to buy insurance company Alleghany for $11.6 billion last month and has been scooping up shares of energy stock Occidental Petroleum.