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>>> Buffett Takes Control of US LNG Plant With $3.3 Billion Deal
Bloomberg
by Ruth Liao
July 10, 2023
https://finance.yahoo.com/news/buffett-takes-control-us-lng-211309707.html
(Bloomberg) -- Berkshire Hathaway Energy agreed to buy Dominion Energy Inc.’s stake in a Maryland liquefied natural gas export project for $3.3 billion.
The deal will boost the company’s limited partnership ownership of the terminal to 75%, while a unit of Brookfield Infrastructure Partners holds the remaining 25%, Warren Buffett’s Berkshire said in a statement Monday.
Berkshire Hathaway Inc. first took a stake in the one-train export plant with an annual export capacity of 5.25 million tons in 2020.
The deal will give Berkshire control of one of just seven operational US facilities that can export LNG at a time when the fuel has assumed an increased economic and geopolitical significance. Natural gas prices surged in 2022 following the invasion of Ukraine, and US exports of the liquefied form of the fuel helped to sustain Western European economies after Russia cut supplies.
Cove Point LNG is contracted on a long-term basis to companies including Tokyo Gas Co. and Sumitomo Corp.
Dominion said in a separate statement that it will use the proceeds to repay debt. Dominion, which has been conducting a business review, has said it plans to host an investor day in the third quarter to give an updated strategic and financial outlook.
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>>> Warren Buffett's Bold Move: Acquiring a 10% Dividend Yield Stock
Motley Fool
By Lee Samaha
May 27, 2023
https://www.fool.com/investing/2023/05/27/warren-buffetts-bold-move-acquiring-a-10-dividend/
KEY POINTS
The investment case for Vitesse Energy is based on its management team.
The company operates a flexible and conservative business model.
Hedging and diversifying its investments helps to reduce risk.
Berkshire Hathaway's acquisition of stock in a high-yield oil and gas company is attracting a lot of investor interests.
Warren Buffett's Berkshire Hathaway purchased just over 51,000 shares in oil and gas company Vitesse Energy (VTS -0.88%) in the first quarter. It's not a significant position for Berkshire -- the current value is just over $1.1 million. However, it is intriguing for retail investors who want to follow the oracle of Omaha into a stock currently yielding 9.5%. So let's look at Vitesse and why it might attract income-seeking investors.
A classic Warren Buffett stock
The stock has all the hallmarks of a Buffett value stock purchase. The key to this argument is as follows:
It's an investment decision that relies on Berkshire's confidence in an experienced management team. I'll return to this point in detail in a moment.
It's a shareholder-friendly company with management aiming to grow dividends over time and expecting to initially "pay quarterly cash dividends and dividend equivalents totaling approximately $66.0 million per fiscal year" -- equivalent to $2 per share.
Management diversifies risk in its business model, ensuring free-cash-flow generation is returned to investors in the form of buybacks and dividends.
It's a classic "value" investment because the downside is limited, while the upside is significant.
Introducing Vitesse Energy
The company is unusual in the oil and gas sector because it's not an owner/operator of assets. Instead, its management team, led by industry veteran Bob Gerrity as CEO, acquires interests in oil and gas assets (primarily in the Bakken oil field in North Dakota) operated by leading oil companies. Some of its better-known listed partners include Chord Energy, Civitas Resources, Hess, and to a lesser extent, Marathon Oil and ExxonMobil.
The company's risk management extends to diversifying its interests. As of March 2023, the company had interests in 6,475 productive wells "with an average working interest of 2.7% per working interest well," according to company presentations. In addition, management aims for a ratio of net debt to earnings before interest, taxes, depreciation, and amortization (EBITDA) of less than 1. Also, it uses hedging to reduce its exposure to the volatility of oil and gas prices.
The conservatively run balance sheet and hedging reduce the upside potential from higher oil and gas prices. Still, it also helps ensure a steady cash flow stream to support dividends. In addition, it means Vitesse can be in relatively better shape to deal with a downturn -- a significant plus because management can then go and use its cash flow to pick up working interests in oil and gas assets when prices are low.
Another advantage of not being an owner/operator of assets is that Vitesse is "burdened with various contractual arrangements with respect to minimum drilling obligations, and [the company] can avoid exploratory, upfront leasing and infrastructure costs customarily incurred by operators" according to its SEC filings.
Why the management team matters
Given the business model, it's clear that investing in Vitesse Energy means trusting in the management team to allocate capital wisely, manage risk accordingly, and have the skill to identify productive investments. It's relatively less of what could be crudely described as the typical oil-price-led investment in oil and gas assets. Hedging commodity price volatility is always going to be an imperfect science. For example, Vitesse doesn't hedge its natural gas (only responsible for 13% of revenue in the first quarter) production and has no plans to do so, and only 31% of its oil production is hedged to 2024.
That said, management retains the flexibility to hedge higher percentages of its oil production, which helps lower risk. That came through in the first-quarter results with average realized prices before hedging of $72.95 a barrel, compared to $74.02 after hedging.
It's clear that management's role is crucial, and it's worth looking into the key figure at Vitesse, namely Gerrity. He is the founder of Gerrity Oil & Gas Corporation, which merged with Snyder Oil assets to create Patina Oil in 1996, a company then acquired by Noble Energy in 2008. Gerrity would go on to found Vitesse Energy in 2014.
Gerrity and his management team have a demonstrable track record of success, and there's no doubt that Berkshire feels comfortable with the company's business model.
A stock to buy?
If you are looking for oil and gas exposure and a high-yield stock, and you trust what Berkshire sees in Vitesse's management, the stock offers an excellent option for investors. The fossil fuel sector isn't short of high-yield candidates, but Vitesse is one of the relatively lower-risk plays in the sector. As such, the stock is attractive for income-seeking investors.
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>>> Vitesse Energy (VTS)
https://finance.yahoo.com/news/11-yielding-dividend-stocks-look-133250100.html
First up is Vitesse Energy, a non-operator that owns financial interests in oil and gas wells drilled in the US. It’s simpler than it sounds – Vitesse acts as an investor, owning hydrocarbon wells while leaving the oil and gas drilling and exploitation to third-party firms. Vitesse generates revenue from the development of non-operated assets in oil and natural gas. The company acquires leasehold properties and converts them into active drilling operations, tapping into cash flow from both the leases and the oil and gas production.
This has proven to be a sound business mode, and has been profitable for Vitesse for the last 10 years. The company’s portfolio includes over 50,000 net acres and approximately 6,500 actively producing oil and gas wells. For most of its existence, Vitesse was privately held, and during that time it retuned $124 million to its shareholders. The company from the Jefferies Financial Group became a public entity in January of this year, and since then has continued its policy of capital return, using a high-yield dividend as the vehicle.
That dividend was last declared on May 4, for 50 cents per common share. That declaration marked the firm’s second dividend payment as a public entity. With a forward annualized rate of $2 per share, the dividend gives an impressive yield of 11.3%, far above the current inflation rate, ensuring investors a substantial real rate of return.
The dividend is supported by the company’s non-GAAP earnings result, which came in a 53 cents per share for 1Q23, beating the forecast by 29 cents. Vitesse’s Q1 results in revenue and GAAP earnings were less impressive, however. The firm’s top line of $57.96 million was $2.87 million below expectations, and the GAAP EPS result came in at a net loss of $1.67, well below the 9-cent loss that had been forecast.
This doesn’t worry Northland analyst Donovan Schafer, who notes that Vitesse’s adjusted EBITDA of $40.1M beat consensus of $36.9M and his estimate of $36.5M. Schafer goes on to describe recent earnings as ‘boring,’ and writes: “VTS is meant to be a steady dividend payer with upside over time from commodity price exposure and opportunistic M&A. Trading at ~$18, the dividend is ~11%, which investors can collect while sitting in a position that gives upside commodity price exposure and limited downside…”
In Schafer’s view, this justifies an upgrade for the shares, from Neutral to Outperform (i.e. Buy), and his price target of $23 suggests a one-year upside potential of ~30%. Based on the current dividend yield and the expected price appreciation, the stock has ~41% potential total return profile. (To watch Schafer’s track record, click here)
Overall, VTS stock gets a Strong Buy rating from the Street’s analyst consensus, based on 3 unanimously positive reviews. The shares are trading for $17.72 and their $22.67 average price target implies a gain of ~28% in the next 12 months.
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>>> Capital One Financial Corporation (COF) operates as the financial services holding company for the Capital One Bank (USA), National Association; and Capital One, National Association, which provides various financial products and services in the United States, Canada, and the United Kingdom. It operates through three segments: Credit Card, Consumer Banking, and Commercial Banking. The company accepts checking accounts, money market deposits, negotiable order of withdrawals, savings deposits, and time deposits. Its loan products include credit card loans; auto and retail banking loans; and commercial and multifamily real estate, and commercial and industrial loans. The company also offers credit and debit card products; online direct banking services; and treasury management and depository services. It serves consumers, small businesses, and commercial clients through digital channels, branches, cafés, and other distribution channels located in New York, Louisiana, Texas, Maryland, Virginia, New Jersey, and California. Capital One Financial Corporation was founded in 1988 and is headquartered in McLean, Virginia.
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https://finance.yahoo.com/quote/COF/profile?p=COF
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>>> Vitesse Energy, Inc. (VTS) focuses on acquisition, ownership, exploration, development, management, production, exploitation, and dispose of oil and gas properties. The company acquires non-operated working interest and royalty interest ownership primarily in the core of the Bakken Field in North Dakota and Montana. It also owns non-operated interests in oil and gas properties in Colorado and Wyoming. The company was incorporated in 2022 and is based in Centennial, Colorado. <<<
https://finance.yahoo.com/quote/VTS/profile?p=VTS
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>>> Liberty Latin America Ltd (LILA)., together with its subsidiaries, provides fixed, mobile, and subsea telecommunications services. The company operates through C&W Caribbean, C&W Panama, C&W Network & LatAm, Liberty Puerto Rico, Liberty Costa Rico, and VTR segments. It offers communications and entertainment services, including video, broadband internet, fixed-line, telephony, and mobiles services to residential and business customers; and business products and services that include enterprise-grade connectivity, data center, hosting, and managed solutions, as well as information technology solutions for small and medium enterprises, international companies, and governmental agencies. The company also operates a sub-sea and terrestrial fiber optic cable network that connects approximately 40 markets. It provides its services under the brands of C&W, VTR, Liberty Costa Rica, Liberty Communications, BTC, Flow, and Mas Móvil. The company was incorporated in 2017 and is headquartered in Hamilton, Bermuda.
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https://finance.yahoo.com/quote/LILA/profile?p=LILA
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>>> Jefferies Financial Group Inc. (JEF) engages in the investment banking and capital markets, and asset management businesses in the Americas, Europe, the Middle East, and Asia. The company operates in two segments, Investment Banking and Capital Markets, and Asset Management. It provides investment banking, advisory services with respect to mergers or acquisitions, restructurings or recapitalizations and private capital advisory transactions; equity and debt underwriting; and corporate lending. In addition, the company offers financing, securities lending, and other prime brokerage services; equities research and finance; and wealth management services. Further, it provides clients with sales and trading of investment grade corporate bonds, U.S. and European government and agency securities, municipal bonds, mortgage-backed and asset-backed securities, leveraged loans, consumer loans, high yield and distressed securities, emerging markets debt, interest rate, and credit derivative products, as well as foreign exchange trade execution and securitization; and manages, invests in, and provides services to a diverse group of alternative asset management platforms across a spectrum of investment strategies and asset classes. The company was formerly known as Leucadia National Corporation and changed its name to Jefferies Financial Group Inc. in May 2018. Jefferies Financial Group Inc. was founded in 1962 and is headquartered in New York, New York.
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https://finance.yahoo.com/quote/JEF/profile?p=JEF
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>>> Formula One Group (FWONK) engages in the motorsports business in the United States and internationally. It holds commercial rights for the world championship, approximately a nine-month long motor race-based competition in which teams compete for the constructors' championship and drivers compete for the drivers' championship. The company was founded in 1950 and is based in Englewood, Colorado. Formula One Group is a subsidiary of Liberty Media Corporation.
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https://finance.yahoo.com/quote/FWONK/profile?p=FWONK
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Taiwan Semiconductor - >>> Warren Buffett’s Berkshire Hathaway sells entire stake in TSMC
CNN
By Michelle Toh
5-16-23
https://www.cnn.com/2023/05/16/investing/berkshire-hathaway-taiwan-tsmc-stock-exit-hnk-intl/index.html
Warren Buffett’s conglomerate has sold its remaining shares in the world’s largest chipmaker, TSMC, after the “Oracle of Omaha” sounded alarms about its home base of Taiwan.
In a Monday filing, Berkshire Hathaway (BRKA) disclosed that it was no longer holding a stake in Taiwan Semiconductor Manufacturing Company (TSM) as of the end of the first quarter.
In recent weeks, Buffett had repeatedly expressed concerns over the future of Taiwan, the self-governed democratic island where TSMC is based. China’s Communist leadership has long claimed Taiwan as part of its territory, despite having never ruled over it.
The move completes an exit from TSMC by one of the world’s most watched investors, which had already been winding down its stake in recent months.
In February, Berkshire revealed it had sold 86% of its shares in TSMC, which were purchased for $4.1 billion just months before. The quick sale was considered unusual because Buffett is known for making longer term bets.
Warren Buffett gives reason for surprise sale of stake in Taiwan's TSMC
Asked to explain his decision on an analyst call this month, the billionaire said: “I don’t like its location, and I’ve reevaluated that.”
“I feel better about the capital that we’ve got deployed in Japan than in Taiwan,” the Berkshire Hathaway chairman added. “I wish it weren’t sold, but I think that’s a reality.”
Despite the share sale, Buffett lauded TSMC as “one of the best-managed companies and [most] important companies in the world.”
“There’s no one in the chip industry that’s in their league, at least in my view,” he said.
“Marvelous people and marvelous competitive position and everything, [but] I’d rather find it in the United States.”
Buffett said his reassessment of the company was in “light of certain things that were going on.” He had previously pointed to geopolitical tensions as a concern.
TSMC declined to comment Tuesday on Berkshire Hathaway’s divestment.
‘Silicon shield’
TSMC is considered a national treasure in Taiwan, supplying semiconductors to global tech giants including Apple (AAPL) and Qualcomm (QCOM).
It mass produces the most advanced semiconductors in the world, components that are vital to the smooth running of everything from smartphones to washing machines.
The firm is the world’s largest chip manufacturer, according to Gartner. It’s also one of the world’s most valuable listed companies, with a market capitalization of 12.8 trillion New Taiwan Dollars (approximately $415.3 billion) as of Tuesday.
As the world courts TSMC, Taiwan worries about losing its 'silicon shield'
TSMC’s presence is seen as providing a strong incentive to the West to defend Taiwan against any attempt by China to take it by force.
The company is perceived as being so valuable to the global economy, as well as to China, that it is sometimes even referred to as forming part of a “silicon shield” against a potential military invasion by Beijing.
While TSMC is expanding overseas in countries including the United States, it’s also growing its footprint back home in Taiwan, where it plans to add more than 6,000 jobs this year.
As Berkshire Hathaway revealed its withdrawal Monday, other prominent investors made bets on the stock. According to a regulatory filing, Macquarie has increased its stake in TSMC, while Tiger Global has also bought in.
TSMC stock rose 2% Tuesday in Taipei, while its US-listed shares slipped 0.5% in after-hours trading in New York.
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>>> Berkshire Hathaway's Annual Meeting
Bloomberg
https://www.barrons.com/livecoverage/berkshire-hathaway-warren-buffett-annual-shareholder-meeting/card/berkshire-won-t-be-investing-in-automakers-buffett-says-
Live coverage of the conglomerate's shareholders event and first-quarter results.
May 6, 2023
The Latest From Berkshire Hathaway, Warren Buffett, and Charlie Munger
The Q&A session at Berkshire Hathaway’s 2023 annual shareholders’ meeting ended early on Saturday, after back-to-back three-hour sessions of questioning for the conglomerate’s management.
CEO Warren Buffett and vice chairmen Charlie Munger, Ajit Jain, and Greg Abel addressed queries from shareholders about Berkshire’s business performance, their thoughts on macroeconomic issues and the recent banking turmoil
Buffett, 92, and Munger, 99, sprinkled in genial anecdotes and grandfatherly advice for Berkshire’s younger shareholders. Attendance was high at this year’s so-called “Woodstock for Capitalists,” after a relatively muted 2022 confab following two year of virtual meetings during the Covid-19 pandemic.
Berkshire’s first-quarter results were released earlier on Saturday morning, showing a 12.6% rise in operating profit, to $8.1 billion, and a faster pace of buybacks compared with the fourth quarter of 2022.
-- Andrew Bary and Nicholas Jasinski
Read next:
Berkshire Earnings Are Out. What to Know.
What Shareholders Are Saying, and Buying, at the Meeting
10 Tough Questions for the Oracle of Omaha and His Team
Stock Pick: Berkshire Has Its Groove Back
Berkshire Won’t Be Investing In Automakers, Buffett Says
Berkshire Hathaway (ticker: BRK.A, BRK.B) isn’t likely to invest in shares of automakers like General Motors (GM) or Ford Motor (F), CEO Warren Buffett said at the company’s annual shareholders’ meeting on Saturday.
“Charlie [Munger] and I have long felt that the auto business is just too tough,” Buffett said, adding an anecdote about Henry Ford’s challenges in the industry in the early 1900s.
Buffett said that there are too many global competitors for the automaking business to generate attractive returns. It’s also in the midst of a transition to electric vehicles, which imposes huge capital costs and risks in the near term before it becomes clear which companies will be successful and which won’t.
Berkshire prefers the auto dealership business, where it owns 78 dealerships across the U.S. Those generate more than $8 billion in annual revenue, making Berkshire among the largest dealership groups in the U.S.
Buffett Says Berkshire Remains On the Hunt for an ‘Elephant-Sized’ Acquisition
By Nicholas Jasinski
Berkshire Hathaway (ticker: BRK.A, BRK.B) has nearly $130 billion in cash and Treasury bills on its balance sheet. There’s ongoing speculation about what the company might do with all that dry powder.
At Berkshire’s annual shareholders’ meeting on Saturday, CEO Warren Buffett said that he would rather do a deal for a large company than sit on the cash, earning interest, but that it all depends on the prices available. Things are generally expensive these days.
“If we could buy a company for $15 billion, $75 billion, $100 billion, we could do it,” Buffett said. He noted that it’s more complex to buy a publicly traded company due to the longer timeline, shareholder vote, and other rules. But there just aren’t that many private companies of that scale available.
Buffett spoke about opportunities that emerged during the global financial crisis in 2008, including deals to buy shares in several troubled banks at attractive prices, and said that he expects Berkshire to get similar calls in the future.
“There’s no one else quite like us who can [do a deal] under the right circumstances,” Buffett said.
In the meantime, Berkshire is earning close to 5% on its T-bills. It has also been buying stock in recent years.
Buffett Says Streaming Remains a Challenging Business, Sticks With Paramount
By Nicholas Jasinski
CEO Warren Buffett addressed Berkshire Hathaway’s (ticker: BRK.A, BRK.B) investment in Paramount Global (PARA) at the company’s annual shareholders’ meeting in Omaha on Saturday. The media company is in the midst of an expensive transition from legacy businesses in cable TV and movies to a streaming future.
Paramount shares dropped 28% on May 5 following a disastrous quarterly earnings report that included a large loss and a slash to the company’s dividend.
“It’s not good news when any company cuts its dividend dramatically,” Buffett said.
He noted that the streaming business remains challenging, with numerous competitors keeping prices low. It’s easy to cancel a streaming subscription and hop to a competing service.
“There are a bunch of companies who don’t want to quit,” Buffett said. “Who knows what will happen with pricing.”
Berkshire became the largest holder of Paramount stock last year, with a stake of around 15%. Shares are down by about half since Berkshire began buying in the first quarter of 2022.
PARAMOUNT GLOBAL CL BPARA(U.S.: NASDAQ)
Buffett Faults Bank Risk Taking, Calls for More Active FDIC
By Nicholas Jasinski
Berkshire Hathaway (ticker: BRK.A, BRK.B) CEO Warren Buffett sees excessive risk taking at banks as the root of the 2023 banking turmoil. He called for more conservative banking practices and better communication from regulators at Berkshire’s 2023 annual shareholders’ meeting.
“The situation in banking is what it always was,” Buffett said. “Fear is contagious. Sometimes the fear is justified, sometimes it isn’t.” Buffett recalled that his father, Howard Buffett, lost his job during a bank run in the Great Depression.
Buffett praised the Federal Deposit Insurance Corp. for the greater stability of the banking system offered by the regulators’ deposit insurance, but said that it needed to better communicate with the American public to prevent further potential bank runs and potentially consider guaranteeing 100% of deposits until the current turmoil has passed. That’s especially relevant today, when digital banking makes deposits less “sticky,” he said.
Buffett faulted management at First Republic Bank—which was shut down by the Federal Deposit Insurance Corp. last month before its takeover by JPMorgan Chase (JPM)—for concentrating its balance sheet in low-yielding assets that lost value as interest rates rose over the past year.
Buffett placed signs reading “Available for Sale” and “Held-to-Maturity” on the table in front of him and Charlie Munger, Berkshire’s vice chairman, to laughs from the audience. Those are terms that refer to the accounting treatment of securities on a bank’s balance sheet.
“I’m old fashioned,” Munger said. “I liked it when banks didn’t do investment banking…I think having a lot of investment bankers trying to get rich isn’t a good thing. I think bankers should be more like engineers, thinking about what could go wrong.”
May 6, 2023 at 1:15 pm ET
Abel Says He’ll Continue Buffett’s Approach to Share Buybacks
By Nicholas Jasinski
Berkshire Hathaway’s (ticker: BRK.A, BRK.B) vice chairman Greg Abel, Warren Buffett’s appointed successor as CEO, will continue to buy back stock when it appears cheap and the best use of the conglomerate’s cash.
Berkshire bought back $4.4 billion of stock in the first three months of 2023, up from $2.6 billion in the fourth quarter of 2022.
“Greg understands capital allocation as well as I do…and I expect he’ll make those decisions under the same framework that Charlie and I do,” Buffett said.
Buffett is all about intrinsic value, and seeks to buy back Berkshire stock when its price falls below that estimate. He has praised companies like Apple (AAPL) for using excess capital to repurchase shares. He has also criticized management teams for buying back their company’s stock at inflated prices in the past.
“When the opportunity presents itself, we’ll want to be an active purchaser of Berkshire shares,” Abel said. “It’s great for our shareholders to be able to own a larger share in all of Berkshire’s businesses.”
APPLE INC.AAPL(U.S.: NASDAQ)
May 6, 2023 at 12:51 pm ET
Buffett’s TSMC Sale Due to Geopolitical Concerns
By Nicholas Jasinski
CEO Warren Buffett sold Berkshire Hathaway’s (ticker: BRK.A, BRK.B) more-than $4 billion stake in Taiwan Semiconductor Manufacturing Company (TSM) only a few months after acquiring the shares late last year. The Taiwanese semiconductor maker is the world’s leading producer of cutting-edge chips.
Buffett preaches buy-and-hold investing, so the quick entry and exit from the position was a rare short-term move from the 92 year old. That wasn’t a reflection of a change in his assessment of TSMC’s business, Buffett said Saturday at Berkshire’s annual shareholders’ meeting—there’s no one in the same league in the chip industry as TSMC.
“Taiwan Semiconductor is one of the best managed and most important companies in the world, and you’ll be able to say the same thing five, 10, or 20 years from now,” Buffett said. “I don’t like its location.”
A potential U.S.-China geopolitical spat that escalates is a cause for concern for Buffett, with Taiwan likely to be at the epicenter of any conflict.
“My view is that Warren ought to feel comfortable if he wants to,” said Berkshire vice chairman Charlie Munger, in between bites of peanut brittle from See’s Candies. “Put that in the minutes!” Buffett responded.
TAIWAN SEMICONDUCTOR MANUFACTURING CO. LTD. ADRTSM(U.S.: NYSE)
May 6, 2023 at 12:16 pm ET
Insurance Profits Are Up at Berkshire, But Jain Worries About a Florida Hurricane
By Nicholas Jasinski
Pricing is strong and improving in catastrophe insurance after a tough decade and a half for the category, Berkshire Hathaway’s (ticker: BRK.A, BRK.B) vice chairman in charge of insurance operations Ajit Jain said at the company’s annual shareholders’ meeting on Saturday. Those are policies that insure homes and businesses against natural disasters including earthquakes and hurricanes.
That has helped to drive better underwriting profits at Berkshire’s reinsurance businesses.
Jain warned that the company’s exposure was “unbalanced,” however, with particularly large concentration in Florida. Across all of Berkshire’s insurance operations, the conglomerate could see a loss of up to $15 billion if there’s a majorly destructive hurricane in Florida this year—if there isn’t, it could mean a profit of up to $7 billion, Jain estimated.
Jain said that the recently acquired insurer Alleghany, which Berkshire bought last year for about $11.6 billion, would continue doing business as it had before the deal.
“We treat our operating units independent of each other,” Jain said. “Alleghany will keep doing what they’re doing and they’ve been very successful at it.”
May 6, 2023 at 12:13 pm ET
Berkshire Hathaway Is Taking Part In the Energy Transition
By Nicholas Jasinski
Berkshire Hathaway (ticker: BRK.A, BRK.B) CEO Warren Buffett and vice chairman Greg Abel addressed the conglomerate’s efforts to boost its participation in renewable energy generation at the conglomerate’s 2023 annual shareholders’ meeting in Omaha on Saturday.
“There’s no question there’s an energy transition going on,” said Abel, who oversees Berkshire’s non-insurance businesses, including Berkshire Hathaway Energy. He said the utility company is working to reduce its carbon footprint by 50% in 2030 relative to 2005 levels.
Berkshire Hathaway Energy is investing in windmills and other clean energy generation, plus extending transmission lines to more renewable energy sources, which by their nature are more distributed than traditional power plants.
“It’s a very, very good business opportunity for us,” Abel added.
Buffett said that the United States’ approach to renewable energy is overly fragmented, with different rules and regulations state by state and no society-wide organized effort. He drew a comparison to the World War II-era coordination between the federal government and American businesses to reorient the nation’s industrial economy to support the war effort.
“The capital is there, the people are there, the objective is obvious, we just don’t seem to be able to do it in peacetime,” Buffett said.
May 6, 2023 at 11:14 am ET
Buffett and Munger Disagree on the Future of Value Investing
By Nicholas Jasinski
Legendary value investors Warren Buffett and Charlie Munger see divergent paths for value investors in the coming years. The Berkshire Hathaway (ticker: BRK.A, BRK.B) managers were responding to shareholders’ questions at the company’s annual meeting in Omaha on Saturday.
“I think value investors are going to have a harder time now that there are so many of them competing for a diminished set of opportunities,” Munger said. “My advice to value investors is to get used to making less.”
“Charlie has been telling me the same thing the whole time we’ve known each other,” Buffett said. The two first met over dinner in 1959.
Buffett sees more opportunities than his long-time partner. “What gives you opportunities is other people doing dumb things,” he said. “...And there’s been a great increase in people doing dumb things.”
The 92-year-old value investor noted that Berkshire’s current scale can be both an advantage and a disadvantage, with many potential opportunities too small to move the needle for the $719 billion conglomerate.
A long-term investing horizon is still key to realizing value in investing, Buffett said. “I’d love to be born today, start out with not too much money, and turn it into a lot of money,” he said. “I’m sure Charlie would too.”
“I’d like my big pile [of money] to stay just the way it is,” Munger quipped, to laughs from the crowd. He has a net worth of approximately $2.4 billion, according to Forbes.
May 6, 2023 at 11:07 am ET
Buffett, 92, and Munger, 99 Aren’t Particularly Bullish on AI, Robotics
By Nicholas Jasinski
A shareholder asked Berkshire Hathaway's Warren Buffett and Charlie Munger to share their thoughts on artificial intelligence and robotics and which businesses stood to be disrupted most. “I thank you for asking Charlie that question,” Buffett, 92, demurred.
Munger, 99, noted that he was impressed by the level of automation at BYD (ticker: BYDDY) factories in Asia. But, “I think regular old intelligence works just fine,” Munger added.
“There won’t be any AI that will replace Ajit [Jain, Berkshire vice chairman],” Buffett quipped. He went on to warn about the potential risks of AI technologies, drawing a parallel to the development of the atomic bomb.
BYD CO. LTD. ADR BYDDY(U.S.: OTC)
May 6, 2023 at 11:04 am ET
Buffett’s Vice Chairmen Discuss Berkshire’s Businesses
By Nicholas Jasinski
Berkshire Hathaway CEO Warren Buffett kicked a question about the company’s subsidiaries’ performance to his deputies.
Geico is coming off a strong first quarter, with an underwriting profit of $703 million, versus a loss of $178 million in the year-ago quarter.
Ajit Jain, who oversees Berkshire’s insurance operations, said that Geico is working to close the gap with competitors on its employment of telematics, or usage-based insurance, which adjusts customers’ rates based on how they drive.
“Geico’s technology needs a lot more work than I thought it would,” Jain said, noting that the company uses more than 600 distinct tech platforms.
Greg Abel, who oversees non-insurance operations and is in line to succeed Buffett as CEO, spoke about BNSF. He said there was “more work to be done” on making the railroad more efficient and productive and that he was aware of most competitors moving to precision-scheduled railroading.
2022 was a “reset” year for the business, Abel said, that will set it up for better long-term growth.
May 6, 2023 at 10:47 am ET
Buffett Agrees With Regulators’ Decision to Protect Failing Bank Deposits
By Nicholas Jasinski
The 2023 Berkshire Hathaway shareholders’ meeting’s first question had to do with the past few months’ banking-industry turmoil.
CEO Warren Buffett said that regulators made the right decision to intervene to protect depositors at banks including Silicon Valley Bank, which failed in March.
Had they not, “it would have been catastrophic,” Buffett said.
May 6, 2023 at 10:45 am ET
Buffett Talks First-Quarter Results, Berkshire’s Balance Sheet, and Buybacks
By Nicholas Jasinski
Berkshire Hathaway CEO Warren Buffett ran through the company’s first-quarter results, which were released on Saturday morning. The conglomerate’s operating profit after taxes was up almost 13% year over year, to $8.1 billion.
Buffett attributed the gain to a higher return on the company’s stock portfolio, better interest income on its cash holdings, and a higher insurance underwriting profit.
He continued with an overview of Berkshire’s balance sheet, noting that the company’s $504.5 billion in shareholders’ equity is more than any other American company. Berkshire’s insurance float—the difference between an insurance company’s cash collected from premiums and the claims it must pay out—stood at $165.1 billion at the end of the first quarter, while cash and Treasury bills were $127.7 billion. That’s a lot of ammo for potential acquisitions or interest income.
Berkshire bought back about 9,600 class A shares in the first quarter, worth about $4.4 billion. That was faster than the first-quarter pace of buybacks, but slower than Berkshire’s repurchases in 2020 and 2021.
May 6, 2023 at 10:24 am ET
Buffett and His Vice Chairmen Are On Stage
By Nicholas Jasinski
Berkshire Hathaway CEO Warren Buffett and vice chairman Charlie Munger came to the stage to a standing ovation, accompanied by Ajit Jain and Greg Abel, who oversee the conglomerate’s insurance and non-insurance businesses, respectively.
Buffett opened the company’s 2023 shareholders’ meeting with a joke about “a competing broadcast” going on in the United Kingdom on Saturday morning. “We’ve got our own King Charles here today,” he cracked, gesturing toward Munger.
Buffett proceeded to introduce Abel and Jain, then all of Berkshire’s board of directors who were in attendance.
May 6, 2023 at 10:06 am ET
Berkshire Shareholders’ Meeting Begins With Annual Movie
By Nicholas Jasinski
OMAHA, Neb.—The 2023 Berkshire Hathaway annual shareholder meeting kicked off on Saturday morning with the annual movie showcasing many of the conglomerate’s subsidiaries and equity investments, plus a recorded message from CEO Warren Buffett. It included advertisements from Apple (ticker: AAPL), Dairy Queen, Geico, Coca-Cola (KO), Oriental Trading, Precision Castparts, and more.
The movie also featured a montage of past meetings’ shareholder questions regarding Berkshire’s succession plans and what happens after Buffett, now 92, is no longer CEO—as long ago as at the 1994 meeting. “Incidentally I think I’m in pretty good health,” Buffett said in response. Greg Abel, one of Berkshire’s vice chairmen, is the firm’s anointed successor.
The movie also included several skits with Buffett and his partner Charlie Munger, 99, acting out situations.
One began with the investors debating whether to invest in “internet stocks.” Buffett famously preaches against buying businesses that one doesn’t understand inside and out.
In the bit, a lounging Jamie Lee Curtis receives a call from a bashful Buffett—“Warren ‘All-You-Can-Eat’ Buffet?” she asks, picking up the phone. Buffett asks her to convince Munger to buy internet stocks. In a seductive voice, she calls Munger and asks “Is this Charlie Hunger?” before successfully cajoling him to invest.
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>>> Buffett's Berkshire posts $35.5 bln profit, buys back more stock
Reuters
by Jonathan Stempel
May 6, 2023
https://finance.yahoo.com/news/1-buffetts-berkshire-posts-35-130933840.html
Berkshire Hathaway Aggregate Says Fair Value Of Equity Investments In Chevron As Of Mar 31, 2023 Was $21.6 Billion Versus $30 Billion As Of Dec 31, 2022
OMAHA, Nebraska, May 6 (Reuters) - Warren Buffett's Berkshire Hathaway Inc posted a $35.5 billion first-quarter profit on Saturday, reflecting gains from stocks such as Apple Inc, while higher investment income and a rebound at car insurer Geico bolstered operating results.
Berkshire also sped up repurchases of its own stock, buying back $4.4 billion, while paring its investments in other stocks such as Chevron Corp, which is still a major holding.
Results were released ahead of Berkshire's annual shareholder meeting in Omaha, part of a weekend that draws tens of thousands of people to the city.
Buffett, 92, has run Berkshire since 1965, transforming it from a struggling textile company into a conglomerate with dozens of businesses including Geico, the BNSF railroad, Berkshire Hathaway Energy, and manufacturing and retail units including See's Candies and Dairy Queen ice cream.
The diversification has led many investors, not just Buffett fans, to view Berkshire as a stable long-term investment even amid recession fears and concerns about the banking industry.
MORE CASH
Net income equaled $24,377 per Class A share and rose from $5.58 billion, or $3,784 per share, a year earlier.
That in part reflected a 27% jump in Apple's stock price, leaving Berkshire with a $151 billion stake in the iPhone maker.
An accounting rule requires Berkshire to report unrealized gains and losses with net results, and Buffett urges investors to ignore the resulting volatility.
Quarterly operating profit increased 13% to $8.07 billion, or about $5,561 per Class A share, from $7.16 billion.
Those results benefited from Geico snapping a six-quarter string of underwriting losses, and a 68% increase in how much Berkshire's insurance units generate from investments.
Geico's pretax underwriting gain was $703 million, benefiting from higher premiums, fewer crashes and a significant drop in ad spending, which may have led to fewer high-risk drivers seeking coverage.
Berkshire's cash hoard grew $2 billion in the quarter to $130.6 billion, as the company sold $13.3 billion of stocks and bought just $2.9 billion.
Chevron appears to have been among the sales, with Berkshire's stake falling 28% to $21.6 billion though the oil company's stock price dropped just 9%.
Berkshire also owns a 23.6% stake in another oil company, Occidental Petroleum Corp.
Its stock sales more than offset the $8.2 billion Berkshire spent to boost its stake in truck stop operator Pilot Travel Centers to 80% from 38.6%, leaving the founding Haslam family with 20%. The increase was expected.
IMPACT OF WILDFIRES
Profit at the BNSF railroad fell 9% to $1.25 billion, hurt by higher fuel costs and lower shipping volumes.
Berkshire Hathaway Energy, normally a steady earnings generator, saw profit fall 46% as it set aside $359 million for legal and other costs from wildfires in Oregon and northern California, where it has multiple operations, in 2020.
Operating results also reflected October's purchase of insurance holding company Alleghany Corp, while net results included a gain related to Pilot.
Berkshire's Class A shares have risen 4.9% this year, trailing the Standard & Poor's 500's 7.7% gain. The index lagged Berkshire by 23.4 percentage points in 2022, excluding dividends.
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>>> How Apple stock became one of Warren Buffett's four 'jewels'
Yahoo Finance
Josh Schafer
May 4, 2023
https://finance.yahoo.com/news/how-apple-stock-became-one-of-warren-buffetts-four-jewels-204336773.html
Warren Buffett's investment in Apple (AAPL) stock has quickly become the most prominent holding in Berkshire Hathaway's (BRK-A, BRK-B) $360 billion equity portfolio.
Berkshire first bought the stock in 2016, and since then Apple has grown to a $110 billion position comprising roughly 40% of Berkshire's stock holdings. Berkshire owns just under 6% of Apple.
The rapid growth has positioned the largest US public company as a fixture in Berkshire Hathaway's annual shareholder letters and Buffett's comments during annual meetings.
At Berkshire's annual shareholders meeting on Saturday, investors will eagerly await what Buffett might say about his largest holding and its new forays into augmented reality headsets, in-house computer chip creation, and expansion in India.
The meeting also comes less than 48 hours after Apple's earnings report published late Thursday, which showed better than expected iPhone sales despite a 3% revenue decline year-over-year.
Year-to-date, shares of the iPhone maker are up nearly 30%.
The four 'jewels'
In 2020, Buffett highlighted the Apple investment as one of the company’s four "jewels," along with Berkshire's insurance operations led by Ajit Jain, Berkshire's ownership of railroad BNSF, and its Berkshire Hathaway Energy subsidiary.
From shareholder returns to its brand recognition to its management team, Apple fits the bill for a Buffett bet.
Buffett has long been a believer in the benefits of share buybacks and highlighted outsized dividend payments Berkshire receives from some long-time holdings like Coca-Cola (KO) and American Express (AXP) in this year's letter to shareholders.
"Our cost for that stake was $36 billion," Buffett wrote in his 2020 annual shareholder letter about the company's investment in Apple. "Since then, we have both enjoyed regular dividends, averaging about $775 million annually, and have also — in 2020 — pocketed an additional $11 billion by selling a small portion of our position.
"Despite that sale — voila! — Berkshire now owns 5.4% of Apple. That increase was costless to us, coming about because Apple has continuously repurchased its shares, thereby substantially shrinking the number it now has outstanding." Today, Berkshire owns about 5.8% of the company.
The Oracle of Omaha, however, was patient in entering the fray on his Apple position.
Berkshire didn't place its bets on the company after the success of Apple's iPod launch in 2001 or its iPhone launch six years later. Instead, Buffett's ride with Apple has been fueled largely by growth in the company's services business.
In 2015, Apple reported annual services revenue of $19.9 billion and wearable revenue of $10.1 billion.
In 2022, those categories produced $78.1 billion and $41.2 billion, respectively.
"I just think of basically the utility of those products to a ecosystem that is demographically terrific and finds that instrument useful dozens and dozens of times a day," Buffett told Yahoo Finance in 2020. "It's almost indispensable, not only to individuals, business, I mean, everything."
More recently, Apple launched its high-yield savings account with Goldman Sachs, and at an event in September 2022 the company stressed its ambitions to integrate more deeply with healthcare tools.
And when it comes to management, Buffett has rarely been lacking for praise of Apple CEO Tim Cook.
"Tim Cook, Apple’s brilliant CEO, quite properly regards users of Apple products as his first love, but all of his other constituencies benefit from Tim’s managerial touch as well," Buffett wrote in Berkshire's 2021 letter to shareholders.
Adding at the 2021 annual shareholders meeting: "Tim Cook was underappreciated for a while. He's one of the best managers in the world. And I've seen a lot of managers. And he's got a product that people absolutely love. And there's an installed base of people, and they get satisfaction rates of 99%."
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>>> How Warren Buffett avoided damage from the current banking crisis
Yahoo Finance
by David Hollerith and Dan Fitzpatrick
May 5, 2023
https://finance.yahoo.com/news/how-warren-buffett-avoided-damage-from-the-current-banking-crisis-150631786.html
Warren Buffett hasn’t emerged yet as a white knight for regional banks in this current crisis. What he has done, however, is sidestep damage to Berkshire Hathaway’s portfolio.
The Oracle of Omaha sold a large portion of Berkshire’s holdings in US banks between 2020 and 2022, some just months before the banking system upheaval that began in mid March.
Berkshire exited giant stakes of JPMorgan Chase (JPM), Wells Fargo (WFC), and Goldman Sachs (GS) during the period, and it also considerably reduced its ownership in regional lender US Bancorp (USB) and custody bank Bank of New York Mellon (BK).
Berkshire still has sizable holdings in giants Bank of America (BAC) and Citigroup (C) as well as a smaller piece of online bank Ally Financial (ALLY).
“I would assume they did not think that they were going to make over the following five to ten years as much as they could by doing something else,” said Bill Smead, founder and chairman of Smead Capital Management, when asked why Berkshire exited banks when it did.
Buffett said earlier in the pandemic that he didn't want to be overexposed to the industry. He has said little on the subject this year beyond a recent interview with CNBC’s Becky Quick, where he did acknowledge reducing his exposure amid concerns that banking could run into a lot of "trouble."
“I didn’t like the banking business as well as I did before,” he said during the April 12 interview. “I just think the system isn’t set up quite right in terms of connecting punishment to culprits,” he added. “It’s incredibly important that your banking system run well.”
Buffett’s specific thoughts on the banking system will likely be front and center this weekend at the Berkshire Hathaway annual meeting, an annual Omaha, Neb. extravaganza that attracts tens of thousands of Buffett followers from around the country. The highlight of the event is a wide-ranging question-and-answer session with Buffett on Saturday.
The 92-year-old billionaire has over the decades played the role of rescuer to a number of financial institutions while also serving as an unofficial adviser to Washington officials during periods of extreme financial turmoil.
He has yet to play the role of rescuer during this crisis, at least in any way that has thus far been made public, but he may have offered some of his advice to the White House.
Reuters reported that he talked to the Biden administration in March as the banking unrest raged. When asked about those talks, he told CNBC that “I haven’t spoken to anybody that recently, but I’ve spoken with people.”
'A remarkably good business'
Buffett's complicated history with banks spans more than five decades. It started when Berkshire in 1969 bought Illinois National Bank and Trust in Rockford, Ill. Buffett eventually spun it off after a change in US banking laws made it difficult for him to own non-banking businesses at the same time.
During the 1987 market crash he invested in Wall Street investment bank Salomon Brothers, only to see that investment backfire when a bond trading scandal nearly pushed the company into bankruptcy. Buffett became chairman of the firm and ran it for nine months. He saved the company but called the experience “far from fun” in a 1992 shareholder letter.
This didn’t stop him, however, from making big bets on more traditional commercial banks that took deposits and made traditional loans. In fact, he became the largest investor in Wells Fargo, Bank of America, Bank of New York Mellon, and US Bancorp.
His Wells Fargo ownership, which started in 1989, rose as high as 13% in 1994.
“Banking has been a remarkably good business in this country,” he told shareholders at the 2003 annual meeting.
His connection to the industry deepened in 2008, when he played a key role in restoring confidence in banks during the worst financial crisis since the Great Depression. Goldman Sachs came to him seeking capital, along with his stamp of approval. Buffett injected $5 billion into Goldman.
It was also Buffett who suggested in 2008 to then-Treasury Secretary Hank Paulson that the federal government should inject capital into banks to stabilize the industry. That became an official proposal of $250 billion, even though some of the biggest banks insisted they didn’t need the money.
He played the role of rescuer again in 2011 when he injected $5 billion into Bank of America. At the time Brian Moynihan was still a relatively new chief executive and the lender's shares were under severe pressure due to losses from subprime loans.
More investments followed, including a $4 billion stake in industry giant JPMorgan Chase in 2018 and a new bet on PNC Financial Services Group (PNC), another regional lender.
He even told Yahoo Finance before the JPMorgan purchase that he should have bought the stock earlier: “I wish we bought a lot more. I made a mistake.”
'Sure, I noticed it'
But Berkshire's actions changed during the COVID-19 pandemic, as it started to unload many of those same holdings it had been amassing for years.
The most significant, perhaps, was Wells Fargo given Buffett's long-time association with the stock and the company.
At Berkshire's 2015 annual meeting, Wells Fargo even rolled its signature stagecoach down Omaha's 10th street as part of a celebration of Buffett's 50th year in charge of the conglomerate. It also parked another inside the exhibition hall where companies partly or fully owned by Berkshire displayed their goods.
Buffet began unloading the Wells position in 2018 after a series of scandals rocked the bank, including revelations that employees pressured by sales goals opened millions of accounts that customers didn't want and charged fees that weren't necessary.
He unloaded his last stakes in 2022.
Berkshire also no longer owns any of JPMorgan, Goldman, PNC and M&T Bank (MTB). All were sold during the pandemic.
The last reduction disclosed thus far in public filings came in the final quarter of 2022, when Berkshire cut its stakes in Bank of New York Mellon and US Bancorp by 69% and 95%.
Buffett didn't discuss specific banks or positions in his CNBC interview on April 12. But he did make it clear he had noticed some concerning trends in the run up to the current banking chaos.
“Accounting procedures have driven some bankers to do some things that may have helped their current earnings a little bit…and caused the recurring temptation to get a little bit bigger spread and report a little more in earnings,” he said. “And it’s ended in a result you could predict.”
“So you noticed it,” Quick said. “You saw it.”
“Sure," Buffett said. “Sure, I noticed it.”
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>>> Why Warren Buffett keeps buying Occidental Petroleum — 'Nothing but sense'
Yahoo Finance
by Ines Ferré and Josh Schafer
May 3, 2023
https://finance.yahoo.com/news/why-warren-buffett-keeps-buying-occidental-petroleum--nothing-but-sense-153953363.html
Warren Buffett hasn't said much about Occidental Petroleum (OXY) in recent months.
But Berkshire Hathaway's (BRK-A, BRK-B) actions have indicated plenty.
The conglomerate has continued its steady buying of the Houston-based oil and gas explorer with its stake currently standing at 23.6% of the company.
And when the "Oracle of Omaha" takes the stage to address shareholders at Berkshire's annual meeting on Saturday, investors will be focused on not only what he says about energy, but also on whether Occidental will become the company's latest outright purchase.
Asked about his investment at last year's meeting, Buffett said, "What [Occidental CEO] Vicki Hollub was saying made nothing but sense... And I decided that it was a good place to put Berkshire's money."
Buying an oil stock isn't an outlier for Buffett and his team. According to Berkshire's most recent 13F filing, Chevron (CVX) was Berkshire's third largest holding at the end of last year, with the company's position valued at more than $29 billion at today's prices.
Occidental has quickly risen into the top 10 on that list, too, with Berkshire's stake valued at $12.7 billion.
“There are some characteristics of this [Occidental] investment that are consistent with what we've seen historically from Warren Buffett. That it's a value name,” James Shanahan, equity analyst at Edward Jones, told Yahoo Finance.
"It fits this other criteria too, where he likes that the business generates a lot of cash flow and that they buy back stock," he added.
How far Buffett takes this investment is one of the big questions hanging over the company ahead of this weekend's shareholder meeting.
In August of last year, the company received regulatory approval to purchase up to 50% of Occidental common stock. A play for the entire company isn't out of the realm of possibility Shanahan said.
Berkshire executive Greg Abel, heir apparent to Warren Buffett, is also chair of subsidiary Berkshire Energy Holdings. "If [Buffett] were to ultimately acquire Oxy, which he may do, it would be complementary to his other activities of Berkshire Hathaway Energy," said Shanahan.
"And I think that potentially with Greg Abel taking over as CEO of Berkshire, [Hollub] could be a candidate to run Berkshire Hathaway Energy at some point."
Buffett's influence on energy markets
Shanahan, one of the few Wall Street analysts who covers the sprawling Berkshire Hathaway empire, calculates Berkshire's energy investments account for about 13% – or $48 billion — of Berkshire’s roughly $360 billion equity portfolio. Shanahan maintains a Buy rating on the stock.
The conglomerate's entire balance sheet holds a total of about $950 billion in assets, including its insurance operations, wholly-owned subsidiaries, and fixed-income investments.
And Buffett's bets in the oil and gas industry have brought additional confidence to bulls in the space.
Bob Iaccino, co-founder at Path Trading Partners, said Buffett's bets on midstream oil infrastructure plays like Phillips 66 (PSX) and Kinder Morgan (KMI) caught his eye over the past decade.
"I was sort of bolstered, as somebody who thinks we have at least 15 or 20 years of fossil fuels being widely dominant," Iaccino told Yahoo Finance. "I thought his midstream infrastructure investments were some of the things that were more influential."
Berkshire has since closed both of these positions.
The ties between Buffett and Occidental Petroleum go back to April 2019, when Berkshire Hathaway backed Occidental's proposed bid for Anadarko Petroleum with a $10 billion commitment. The deal was pivotal in the company winning its pursuit of Anadarko against Chevron's rival offer.
Buffett's cash infusion gave Berkshire 100,000 preferred shares and the right to buy up to 80 million common shares of the company at $62.50. At the time, Occidental shares were trading just shy of $60.
The stock tanked at the onset of the pandemic, however, as oil prices collapsed amid fears about the global economy. Occidental stock rallied massively last year as oil prices surged and Berkshire has continued buying.
"They've been pretty disciplined that if you look at all the data Berkshire doesn't seem to have a lot of interest in buying the stock above $60 per share," said Shanahan, who calculates the cost basis comes in around $54.90.
Buffett's affinity towards Oxy may stem from his admiration of Hollub's leadership as CEO and the company's carbon capture strategy, in Shanahan's view.
"What they're going to be able to do is sell carbon capture credits — ultimately sell oil, like net zero oil, at a premium to the market," Shanahan said.
In March, Berkshire scooped up another 3.7 million shares of Occidental. Berkshire's ownership percentage also continues to go up each time Occidental buys back its own shares.
Last year's elevated oil prices were a boon for energy companies.
Occidental soared a whopping 117% in 2022 amid historically elevated energy prices, closing at a 52-week high of $75.97 on November 7. The Energy sector (XLE) rose more than 50% in 2022 amid the stock market's worst year since 2008.
Shares have since come off those levels as oil trends lower amid growing banking and recession concerns. Occidental shares are down roughly 5% year-to-date, compared to the S&P 500 index’s 1% gain.
In February, Occidental Petroleum announced record net income for 2022 and a new $3 billion share repurchase authorization along with a 38% dividend hike.
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>>> Floor & Decor Launches the Grand Opening of its Temple, Texas Store
Business Wire
Apr 27, 2023
https://finance.yahoo.com/news/floor-decor-launches-grand-opening-120000157.html
Grand Opening Celebration and Pro Event
ATLANTA, April 27, 2023--(BUSINESS WIRE)--Floor & Decor (NYSE: FND) a leading specialty retailer of hard-surface flooring, will expand its nationwide footprint when it opens the doors to its newest location in the Temple market. The Floor & Decor warehouse store and design center will open with a team of about 50 full-time and part-time associates led by Chris Ellington, the new store’s Chief Executive Merchant.
"Floor & Decor is thrilled to open our doors in Temple," said Ellington. "We are excited to introduce both Professional customers, as well as Homeowners, to our one-stop solution for their flooring needs with an extensive selection of in-stock, trend-right flooring options. We offer unmatched service and quality flooring at unbeatable prices. With our free design services, we look forward to helping every customer turn their vision into reality."
Calling All Pros
Floor & Decor welcomed its valued builders, contractors, architects, designers, remodelers, flooring installers and realtors to its new Temple location with a special PRO VIP Grand Opening event on April 26, 2023. During the event, visitors were able to meet the PRO Services Team, interact with supplier representatives, and learn about Floor & Decor’s PRO Partners services and industry-leading Pro Premier Rewards program.
"Building relationships with our local professionals is very important to us. Their success is our success," said Ellington. "The store tours and giveaways give us a chance to support our community and tell them about our PRO Premier Rewards and all the benefits it can bring to their business."
$1 Million Dice Roll
Perhaps the most enticing of Floor & Decor’s grand opening activities is the $1 million dice roll. Beginning at 10am on May 6, the first 200 visitors, ages 18 and older, in line for the dice roll will have the opportunity to roll a set of six customized dice, each marked with one letter to spell "F-L-O-O-R-S," for the chance to win $1 million. Prizes will be awarded for the following dice combinations:
Roll any four letters, win a $100 Floor & Decor merchandise card
Roll any five letters, win a $1,000 Floor & Decor merchandise card
Roll all six letters to spell FLOORS, win the grand prize of $1 million
The dice roll contest will conclude when 200 people have participated
$5,000 Floor Makeover Sweepstakes
In addition to the $1 million dice roll, the Temple Floor & Decor store will give away a $5,000 Floor Makeover as part of its grand opening festivities. Beginning April 22, 2023, through July 3, 2023, customers will have the chance to register to win a $5,000 gift card from Floor & Decor. Interested parties can register online at www.floormakeovertemple.com.
Store Address: 3111 S 31st Street, Unit 6503A, Temple, TX 76502
About Floor & Decor: Founded in 2000, Atlanta-based Floor & Decor is a leading high-growth specialty retailer of hard-surface flooring, operating 191 warehouse-format stores and six design studios across 36 states as of December 29, 2022. The stores offer homeowners and professionals the industry’s broadest in-stock selection of tile, natural wood, natural stone, laminate and luxury vinyl plank, under one roof. In addition, Floor & Decor stocks the necessary tools, decorative materials, wall tile, and related accessories for hard-surface flooring projects. Stores carry over 1 million square feet of in-stock flooring and offer free design services, as well as a dedicated pro sales team. The company directly sources products from manufacturers around the globe, which enables it to bring the world’s best and most innovative flooring trends to its customers, at everyday low prices. Floor & Decor has locations nationwide, but each store is bolstered by a local focus that creates a store experience and mix of products that meet the needs of each market served.
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AAPL, AMZN, STNE, NU, SNOW - >>> 5 Buffett Stocks to Buy and Hold Forever
Motley Fool
By Keith Noonan
Apr 27, 2023
https://www.fool.com/investing/2023/04/27/got-1000-5-buffett-stocks-to-buy-and-hold-forever/?source=eptyholnk0000202&utm_source=yahoo-host&utm_medium=feed&utm_campaign=article
KEY POINTS
Buffett is best known as a value investor, but Berkshire's portfolio also houses promising growth stocks.
Growth-oriented investors may be able to score wins by taking inspiration from Berkshire's tech and fintech holdings.
These Buffett-backed tech stocks could deliver market-crushing performances through the next decade and beyond.
Berkshire Hathaway's (BRK.A) (BRK.B) track record of success in the investing world is virtually unparalleled. Since CEO Warren Buffett purchased a controlling stake in the company and became its leader in 1965, the investment conglomerate's share price has risen more than 2,768,000%. That means that if you owned and held a $1,000 equity position when the Oracle of Omaha bought the company, it would now be worth roughly $27.7 million.
Berkshire's current size and risk-averse approach to investing mean it's unlikely that the investment conglomerate will manage to match that outsized performance going forward for new investors with $1,000 available to put toward stock purchases. Still, Berkshire continues to grow at a healthy rate and it does happen to own shares in some forward-looking technology companies that could deliver big returns for long-term investors.
If you've got $1,000 available that you don't need to pay bills, bolster an emergency fund, or reduce short-term debts, you might want to put it toward the purchase of some Berkshire-backed stocks that actually could take your portfolio to the next level. Read on for a look at five Berkshire holdings that have the potential to crush the market.
1. Apple
If you want to know what Buffett's favorite stock is, you don't have to read tea leaves or check horoscopes and planetary alignments. Berkshire's quarterly 13F portfolio disclosure filings show the obvious answer. Apple (AAPL) stock is the investment conglomerate's largest holding, by far, and accounts for nearly 44% of its total stock holdings.
Speaking on the company's incredible brand strength and customer loyalty, Buffett recently said, "If you're an Apple user and somebody offers you $10,000, but the only proviso is they'll take away your iPhone and you'll never be able to buy another, you're not going to take it." (wanna bet?) Apple's dominance in the mobile hardware space has made it one of the world's most profitable companies, and it doesn't look like the tech titan is in any danger of losing its industry-leading position anytime soon.
While Apple's strengths have helped it hold up better than most other tech stocks, shares are still down roughly 9% from their high. Thanks to the company's mobile empire, an impressive software and services ecosystem, and untapped growth opportunities in categories including augmented reality and smart cars, the tech leader has clear avenues to continue beating the market.
2. Amazon
Amazon (AMZN) spearheaded the growth of the e-commerce and cloud infrastructure services, and there's a very good chance that it will continue to be one of this century's strongest and most influential companies. While the tech giant's core e-commerce and cloud businesses have faced some macroeconomic headwinds over the last year, Amazon retains leadership positions in both categories, and these two business pillars still look poised for big growth over the long term.
Beyond e-commerce and cloud infrastructure services, Amazon also has massive growth opportunities in other categories. The company has already used advantages created by its online retail platform and data expertise to build the U.S.'s third-largest digital advertising business, and it has plenty of untapped expansion potential in the ads market. Amazon's recently announced Bedrock artificial intelligence (AI) service for building and scaling applications could also be a game changer, and it's likely that AI technologies will spur a wide range of improvements across various aspects of the overall business.
With its incredible breadth of competitive advantages and vast long-term growth potential still ahead, Amazon looks like a smart buy for long-term investors.
3. StoneCo
StoneCo (STNE 4.41%) is a Brazil-based fintech company that provides small and medium-sized businesses (SMBs) with payment processing services. It's also been a provider of loans for SMBs, but this part of the business has struggled due to challenges related to the coronavirus pandemic and a reliance on data that proved to be insufficient for assessing whether businesses were creditworthy.
StoneCo still carries roughly $79 million in bad debt in its loan portfolio, but the company still managed to grow sales by roughly 99% last year, and non-GAAP (adjusted) net income soared 520% in the period. Yet, despite the business growing at an impressive clip and being on track to cover the remaining debt in its portfolio, the company's share price remains down roughly 87.5% from its high.
With the business growing rapidly, StoneCo looks cheaply valued trading at roughly 19 times this year's expected earnings and 1.6 times expected sales.
4. Nu
Like StoneCo, Nu (NU) is a fintech company based in Brazil. The company provides digital banking services and also operates in Mexico and Columbia, and it's been growing at a rapid pace.
The company closed out last year with 74.6 million total customers, up 38.6% year over year, and sales and earnings have soared thanks to new customer additions and higher levels of engagement from those already using its services. Nu's sales surged 128% year over year in the fourth quarter, and net income surged to $113.8 million from $3.2 million in the prior-year period.
Due to macroeconomic pressures, the company's share price trades down roughly 58.5% from its high, and investors have an opportunity to buy the stock at levels that leave room for big upside. Nu is on track to benefit from exploding demand for digital banking services in Latin America, and it could deliver market-crushing returns for long-term shareholders.
5. Snowflake
Snowflake (SNOW) is a leading provider of data warehousing and analytics tools. The company's Data Cloud platform makes it possible for businesses to combine and analyze information that comes from distinct cloud infrastructure services.
According to a survey conducted by S&P Global Intelligence, 98% of enterprise respondents said they either intended to use or were already using cloud infrastructure services from two different providers. Some 31% of respondents in the survey were already using four or more cloud infrastructure providers. The business world is already heavily dependent on multi-cloud setups, and Snowflake is positioned to play a key role in fostering the evolution of analytics, machine learning, artificial intelligence, and a wide range of other technologies and services.
Trading down 65% from its high, this Berkshire portfolio component looks like a worthwhile buy for growth-oriented investors.
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>>> Warren Buffett dumped several banks after spotting red flags in their financials. Here's what spooked him, and which stocks he sold.
Business Insider
by Theron Mohamed
April 19, 2023
https://finance.yahoo.com/news/warren-buffett-dumped-several-banks-174500859.html
Warren Buffett sold his stakes in several banks after spotting red flags in their financials.
The famed investor said their bosses were acting recklessly and misleading investors and analysts.
Here's a closer look at what Buffett said, and which bank stocks he's sold in recent years.
Warren Buffett dumped his stakes in several banks because their bosses were taking "dumb" risks and using deceptive accounting to flatter their earnings, and he believed they would ultimately pay for their misdeeds, he revealed in a recent CNBC interview.
The famed investor's revelation that he predicted trouble in the banking sector is notable given its current turmoil. The sudden collapse of Silicon Valley Bank and Signature Bank in March has sparked concerns of an international banking crisis, worries about the safety of deposits, and fears of lenders pulling back and causing a credit crunch that squeezes consumers and businesses and shoves the US economy into a recession.
Here's a closer look at what the Berkshire Hathaway CEO said, and which bank stocks he's sold in recent years.
Red flags
Buffett noticed that several banks were valuing their assets at cost instead of market value, which artificially inflated their profits and misled investors and analysts, he told CNBC.
They also made a fundamental error by mismatching their assets and liabilities, he noted. For example, they took customer deposits that could be withdrawn immediately, and used them to buy long-dated government bonds and mortgage-backed securities. Silicon Valley Bank did exactly that, and collapsed under a wave of withdrawals in March.
"I don't like it when people get too focused on the earnings number, and forget what in my view are basic banking principles," Buffett said about his decision to pare his bank bets.
"I did think that banking could get in a lot of trouble just because of the kind of things that they did," he continued. "I didn't like the banking business as well as I did before."
Buffett also seemed to address his Wells Fargo wager specifically. The 92-year-old billionaire invested in the scandal-hit Wall Street titan in 1989 and counted it as a cornerstone of his stock portfolio for many years, but sold the last of his shares in the first quarter of 2022.
"I did sell banks that we'd owned for 25 or 30 years," he said. "I just think the system isn't set up quite right in terms of connecting punishment to culprits ... it's incredibly important that your banking system runs well."
Bailing out
Berkshire has exited its stakes in JPMorgan, Goldman Sachs, Wells Fargo, M&T Bank, and PNC Financial over the last three years, Securities and Exchange Commission filings show.
It also slashed its BNY Mellon stake by 69% and its US Bank stake by 95%. The disposals cut the combined value of those positions from nearly $12 billion at the end of 2019, to below $1.5 billion at the end of 2022.
On the other hand, it built new positions in Citigroup, Ally Financial, Jefferies, and NuBank. It also boosted its stake in Bank of America by over 9%, and still counts the lender as its number-two holding after Apple.
Buffett told CNBC that he's stuck with Bank of America because he got a "very decent deal" when he first invested in 2011, he likes CEO Brian Moynihan, and he simply didn't want to sell it.
Despite Berkshire's purchases, the overall value of its bank stocks has shrunk by 49% over the last three years, from $75 billion to $39 billion.
Berkshire discloses the total value of its banking, insurance and financial stocks each quarter. That figure plunged from $102 billion at the end of 2019, to $70 billion at the end of 2022. Moreover, that category of stocks went from making up 41% of its entire equity portfolio to less than a quarter.
Falling share prices were partly responsible for that sharp decline in value. But the main driver was Berkshire's disposals, given the company's cost base for its banking, insurance and financial stocks fell from $40 billion to $26 billion during the three-year period.
It's worth emphasizing that Buffett didn't say which banks had red flags in their financials. He also underscored that just because he sold a bank's stock doesn't mean it's badly run. Yet the investor clearly spotted problems at some of the banks in his portfolio, and decided to cash out before they ran into trouble.
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Floor & Decor (FND) - >>> A niche, Buffett-backed home improvement retailer
https://www.fool.com/investing/2023/04/04/build-wealth-buy-these-growth-stocks/?source=eptyholnk0000202&utm_source=yahoo-host&utm_medium=feed&utm_campaign=article
Berkshire Hathaway's chairman and chief executive officer, Warren Buffett, loves businesses that possess an edge over their competitors. This is probably why his holding company owns a 4.5% position in the specialty home improvement retailer Floor & Decor (FND) worth almost $500 million.
Floor & Decor may not have the name recognition of its larger, more generalized counterparts like Home Depot and Lowe's. But nobody knows the hard-surface flooring space better than the under-the-radar retailer. With the average store coming in at around 79,000 square feet and offering about 4,400 tile, wood, laminate, vinyl, and natural stone flooring products, Floor & Decor can't be beat on product selection. And since the company sources its products straight from manufacturers, it passes savings on to customers with reasonable prices.
As you'd expect for a smaller company, Floor & Decor has yet to peak as a business. The company currently has fewer than 200 stores, which is far below its long-term target of 500 stores. Analysts believe that adjusted diluted EPS will increase at a rate of 13.8% annually through the next five years. That's drastically superior to the home improvement retail industry average earnings growth forecast of 4.1%.
Topping it off, the stock looks to be a bargain for its quality. Floor & Decor's forward P/E ratio of 28.8 is cheap compared to the home improvement retail industry average forward P/E ratio of 16.5. This is why I expect the stock to keep generating double-digit annual total returns for shareholders for at least the medium term.
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>>> StoneCo stock has explosive potential -
https://www.fool.com/investing/2023/04/11/2-stocks-down-more-than-75-to-buy-right-now/?source=eptyholnk0000202&utm_source=yahoo-host&utm_medium=feed&utm_campaign=article
Keith Noonan: StoneCo (STNE 3.09%) is a Brazil-based payment processing and lending company that's seen volatile trading over the last few years. To be more descriptive, it's a fintech services provider with thriving payment solutions for small and medium-sized businesses and a credit business that was crushed by headwinds related to the coronavirus pandemic and flaws in Brazil's national registry system, which was used for loan underwriting.
Even after discharging or selling off much of its credit portfolio at basement-level prices, StoneCo still carries roughly $79 million in bad debt on its books. Due to macroeconomic pressures and the collapse of the credit business, the company's share price is down approximately 91% from its high. But there's an opportunity here.
StoneCo's fourth-quarter earnings report arrived with strong performance for the core payments business and signs the company is emerging from challenges created by its credit business. Sales and earnings performance for the period beat both internal guidance and the average analyst estimates, with revenue growing 44% year over year and non-GAAP (adjusted) net income swinging into positive territory at $46.4 million from a loss of $6.4 million in the prior-year period.
While StoneCo shouldn't be thought of as a low-risk stock, the market appears to be too pessimistic about the company, and it trades at multiples that leave room for explosive upside.
Valued at less than 15 times expected earnings for this year and less than 1.3 times expected sales, the Brazilian fintech services provider offers an attractive risk-reward proposition at current prices. If macroeconomic pressures ease and the company maintains solid footing in its corner of Brazil's payment-processing space, the stock stands a very good chance of delivering strong returns.
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Sumitomo Corporation (SSUMY) engages in general trading business worldwide. It operates through six segments: Metal Products; Transportation & Construction Systems; Infrastructure; Media & Digital; Living Related & Real Estate; and Mineral Resources, Energy, Chemical & Electronics. The company provides steel sheets and tubular products; and manufactures, leases, sells, services, and finances ships, aircrafts, motor vehicles, construction equipment, and components and parts. It is also involved in the development of renewable energy projects comprising power generation and power plant engineering, procurement, and construction activities; electricity retail; industrial facilities and equipment, water, transportation systems and infrastructure, airports, smart city project, environmental solutions, and storage battery businesses; development and operation of industrial parks; arranging insurance; and provision of logistics services. In addition, the company engages in the cable television, 5G related technologies, programming distribution, movies, digital media and video content, TV shopping, and e-commerce businesses; cell phone, ICT platform, digital solution, and venture capital businesses; provision of smart communications infrastructure; operation of food supermarkets and drugstore chains; trade of cement and building materials; and real estate businesses. Further, it develops and trades in coal, iron ore, manganese, uranium, non-ferrous and precious metals, petroleum, natural gas and liquefied natural gas, and commodity derivative transactions; trades in non-ferrous metal products, liquefied petroleum gas, storage batteries, carbon products, plastics, organic and inorganic chemicals, silicon wafers, LEDs, pharmaceuticals, agricultural chemicals, household insecticides, fertilizers, and veterinary drugs; engages in the investing activities; and provides electronics manufacturing services. The company was incorporated in 1919 and is headquartered in Tokyo, Japan.
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>>> Mitsubishi Corporation (MSBHF) engages in the natural gas, industrial materials, petroleum and chemicals, mineral resources, industrial infrastructure, automotive and mobility, food and consumer industry, power solution, and urban development businesses worldwide. The company's Natural Gas segment is involved in the natural gas/oil exploration, production, and development, as well as liquified natural gas businesses. Its Industrial Materials segment invests in, develops, and trades in carbon, steel products, and performance materials for the automobile and mobility, construction, and infrastructure industries. The company's Petroleum & Chemicals segment invests in, develops, and trades in crude oil and oil products, LPG, ethylene, methanol, salt, ammonia, plastics, and fertilizers. Its Mineral Resources segment invests in and develops metallurgical coal, copper, iron ore, and aluminum resources. The company's Industrial Infrastructure segment trades in energy infrastructure, industrial plants, machinery tools, agricultural machinery, mining machinery, elevators, escalators, ships, and aerospace related equipment. Its Automotive & Mobility segment produces, finances, and sells passenger and commercial cars; and mobility services. The company's Food Industry segment develops and sells food resources, fresh foods, consumer goods, and food ingredients. Its Consumer Industry segment engages in supplying products and services a range of fields, including retail & distribution, logistics, healthcare, apparel, and tire, etc. The company's Power Solution segment generates, transmits, and retails power; supplies power generating and transmitting products and equipment; develops and sells lithium-ion battery; develops hydrogen; and offers battery services. Its Urban Development segment engages in the leasing; and urban infrastructure and real estate development, operation, and management businesses. The company was incorporated in 1950 and is headquartered in Tokyo, Japan.
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>>> Marubeni Corporation (MARUY) engages in various business activities worldwide. The company trades in grains, feed ingredients, compound feeds, foods, agricultural and fishery products, and fresh and processed meat; and apparel, footwear, lifestyle, and textile and industrial materials. It also provides agri-inputs, contracting services for fertilizer application and crop protection products, technical services, crop protection product formulations, fertilizers, and oilseeds; ICT and real estate services; petrochemicals and plastics, salts and chlor-alkalis, life science products, electronic materials, and inorganic mineral resources and chemicals; and wood chips, biomass fuels, pulp and waste papers, paper, paperboards, sanitary, and building and construction materials, as well as wood products. In addition, the company explores for, develops, and produces oil and gas; trades in, distributes, and markets petroleum and LPG; develops uranium, nuclear fuel cycle, iron ore, coal, and copper mines, as well as related equipment sales and services; smelts and refines aluminum and magnesium; trades in iron ore, coking coal, non-ferrous metals, ingots and related products, and steel products; and leases temporary steel construction materials. Further, it offers engineering, procurement, and construction, as well as operation and maintenance services for railway systems, water, industrial plants, and waste-to-energy power plants; energy and transportation infrastructure, and water business; and manages infrastructure funds, as well as engages in the power generation, renewable energy, power service and retail, natural gas, hydrogen, ammonia, municipal solid waste, and thermal energy storage businesses. Additionally, it owns, purchases, operates, leases, sells, and charters aerospace and ship products; and sells, trades in, leases, finances, and services construction and industrial machinery, and mobility products. The company was founded in 1858 and is headquartered in Tokyo, Japan.
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>>> Mitsui & Co., Ltd. (MITSY) operates as a general trading company worldwide. The company engages in the manufacture, export, and import of iron and steel products; automotive components; operation of steel processing service centers; trading of automotive, electrical, special, and stainless steel; manufacture, repair, and fabrication of wind turbine towers and flanges; gas distribution businesses; and coal mining, power generation, ferrous alloy, infrastructure maintenance, and water pumping activities. It also explores, develops, and produces oil, natural gas, and LNG; trades in petroleum products, crude oil, coal, uranium, and LNG; offers FPSO/FSO, fright car, truck, and locomotive leasing services; sells electric power facilities; and develops railway and transportation infrastructures. The company engages in logistics businesses; wholesale, retail, rental, and finance of construction and mining equipment; multimodal transportation, warehousing, and rolling stock leasing; sale, purchase, and leasing of aircraft and aero engines; leasing and financing activities; and development, process, and marketing of underground resources, and recycling of surface resources. It also provides electric-arc-furnace, construction materials processing, construction flat-rolled steel, shapes, bars, wire rods, and steel structure materials; methanol, ammonia, chlor-alkali, industrial, gas, and basic chemicals; salt; performance, advanced, specialty, and living, and environmental materials; agrochemicals and fertilizers, and animal and human nutrition products; refined sugar, oils and fats, proteins, grains, and food and beverage products; contract food services; and healthcare products. The company offers mobile communications; commodity derivative trading; venture investment and asset management services; real estate development, management, leasing, and brokerage services; and ship charter operation services. Mitsui & Co., Ltd. was incorporated in 1947 and is headquartered in Tokyo, Japan.
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>>> ITOCHU Corporation (ITOCY) engages in trading and importing/exporting various products worldwide. The company's Textile segment produces and sells fiber and garment materials, textiles fabrics, apparel, and industrial materials; and imports lifestyle brands, fashion accessories, and garments in various areas, such as luxury, casual, and sports. Its Machinery segment provides engineering, procurement, and construction services; operates water and environmental, infrastructure, renewable energy, oil and gas, petrochemical, and independent power producer projects and plants; sells and leases aircraft and related equipment; sells automobiles, construction machinery, electronic systems, industrial machinery, and medical devices; and owns and charters ships. The company's Metals & Minerals segment engages in mining and trading of iron ore, coal, uranium, base metals, and minor metals; trading in non-ferrous metal materials; and processing and trading in steel products. Its Energy & Chemicals segment trades in crude oil, petroleum products, LPG, LNG, natural gas, hydrogen, organic and inorganic chemicals, synthetic resins, household goods, fine chemicals, pharmaceuticals, and electronic materials, as well as generates and trades in power. The company's Food segment produces, distributes, and retails food products. Its General Products & Realty segment produces and sells paper, pulp, natural rubber, tire, and wood products and materials; develops and operates real estate properties, such as housing, logistics facilities, and other projects; and offers logistics services. The company's ICT & Financial Business segment offers IT solutions, Internet related and venture capital services, mobile telephone equipment and services, BPO, broadcasting and communications, entertainment and content services, outsourcing services for healthcare and preventive medicine, and financial and insurance brokerage services. The company was founded in 1858 and is headquartered in Tokyo, Japan.
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>>> Warren Buffett says the unusually quick sale of Berkshire Hathaway's TSMC stake was driven by geopolitical tensions
Markets Insider
by Matthew Fox
Apr 11, 2023
https://markets.businessinsider.com/news/stocks/warren-buffett-berkshire-hathaway-tsmc-stock-china-taiwan-geopolitical-tensions-2023-4
Warren Buffett said geopolitical tensions were a factor behind Berkshire Hathaway's unusually quick sale of Taiwan Semiconductor.
Berkshire Hathaway purchased $4.1 billion of TSMC stock in the third quarter of 2022, but sold nearly 90% of the position a few months later.
Tensions between China and Taiwan have been building as US political figures visit the island in a show of solidarity.
Warren Buffett did something rather unusual last year when his conglomerate, Berkshire Hathaway, purchased a $4.1 billion stake in Taiwan Semiconductor in the third quarter of 2022.
It wasn't the large purchase that was off character for Buffett, but rather the swift sale of almost 90% of the position, which occurred just a few months later in the fourth quarter.
Buffett has built the bulk of his $110 billion fortune by taking an extremely long-term view on stocks and holding onto some companies for decades. So a holding period of just a few months is out of the ordinary for Buffett.
Now we know why Buffett sold the stake so quickly.
In an interview with Nikkei Asia on Tuesday, Buffett said rising geopolitical tensions between China and Taiwan were "a consideration" in its swift sale of the world's largest chipmaker. China claims Taiwan as its own territory, which Taiwan has denied for decades.
And those tensions — which have been building over the past year as more US political figures visit the island and meet with its leaders in a show of solidarity — just aren't worth the headache for Buffett.
He told Nikkei that Taiwan Semiconductor is a well-managed company, but said that Berkshire Hathaway had better places to invest its money. Berkshire owned just over $600 million in Taiwan Semiconductor as of December 31.
One of those places appears to be the big five Japanese trading houses, which jumped on Tuesday after Buffett added to his stakes in Itochu, Marubeni, Mitsubishi, Mitsui, and Sumitomo. He also said he might invest more in the space.
"These five companies are a cross section of not only Japan but of the world. They are really so much similar to Berkshire," Buffett told Nikkei.
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>>> Japanese trading houses rise as Warren Buffett raises stakes and says he may buy more
CNBC
APR 11 2023
https://www.cnbc.com/2023/04/11/berkshire-japan.html
KEY POINTS
Warren Buffett told Nikkei he is considering additional investment in Japan’s five major trading houses.
Berkshire Hathaway has raised its stakes in all five trading houses to 7.4%.
Shares of Mitsubishi Corp. rose 2.1% in Japan’s afternoon trade, Mitsui & Co. gained 2.7% and Itochu Corp climbed 3%.
Shares of Japanese trading houses rose on Tuesday after Warren Buffett, chairman and CEO of Berkshire Hathaway, raised his stakes in the firms and said he may increase his holdings even further.
In an interview with Nikkei, Buffett said he is considering additional investment in five major Japanese trading houses, adding that he was “very proud” of his existing investments in them.
Shares of Mitsubishi Corp. rose 2.08% in Japan’s afternoon trade, Mitsui & Co. gained 2.66%, Itochu Corp climbed 2.98% and Marubeni Corp. advanced 4.55%. Sumitomo Corp. also rose 3.19%.
Berkshire Hathaway has raised its stakes in all five trading houses to 7.4%, according to CNBC’s Becky Quick. That’s up from positions of 6.6% in Mitsubishi Corp., 6.6% in Mitsui & Co., 6.2% in Itochu Corp., 6.8% in Marubeni Corp. and 6.6% in Sumitomo Corp, according to November filings.
Buffett told Nikkei that he is planning to meet with the companies later in the week “to really just have a discussion around their businesses and emphasize our support,” according to the report.
Japan’s five largest trading companies — known as sogo shosha — are conglomerates that import everything from energy and metals to food and textiles into resource-scarce Japan. They also provide services to manufacturers. The trading houses have helped grow the Japanese economy and contributed to the globalization of its business.
Late last year, Berkshire Hathaway increased its positions in the five leading trading houses in Japan by at least 1 percentage point to more than 6% each — after its initial purchase in August, when Buffett acquired stakes worth more than $6 billion in total on his 90th birthday.
Nikkei separately reported that Buffett’s Berkshire Hathaway is preparing another issuance of yen-denominated bonds, which was seen as a signal the conglomerate would increase its investments in Japan.
Buffett will be live from Japan on CNBC’s U.S. “Squawk Box” on Wednesday to discuss his investments in the country.
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>>> Warren Buffett Tells Biden He Wants to Invest in Failed Banks – Can You?
Yahoo Finance
by Yael Bizouati-Kennedy
March 21, 2023
https://finance.yahoo.com/news/warren-buffett-tells-biden-wants-141032464.html
Warren Buffett has reportedly been in talks with the Biden administration about the turmoil surrounding regional banks, which has been rattling markets for the past few days.
The conversation with Berkshire Hathaway’s CEO has been focused on him potentially investing in the regional bank sector, and he has also reportedly provided guidance and advice to the administration, Bloomberg reported.
“My sense is Buffet/Berkshire is probably one entity being considered as an investor as part of the regional bank intervention plan that is likely underway,” said Cathy Seifert, vice president at CFRA Research.
Seifert added that her sense is also that if Buffett/Berkshire were to strike a deal, it would likely be structured similarly to previous deals, whereby he would purchase newly issued preferred stock with warrants to acquire common shares over time.
In terms of whether this could be a good investment, Seifert said she couldn’t “say whether other investors should follow suit since I don’t know what banks are involved and whether the terms of any potential Berkshire deal could be replicated by another investor.”
As Bloomberg reported, the Oracle of Omaha’s role would be similar to the one he played during the 2008 financial crisis, when he stepped in and made a $5 billion investment in Goldman Sachs.
The quick collapse of Silicon Valley Bank -followed by the closing of crypto-friendly bank Signature Bank, because of a “similar systemic risk”-and the ensuing measures regulators took to avoid more damage on Sunday evening March 12, have prompted contagion fears and created chaos in the markets. The Federal Reserve and the Treasury Department also announced a new Federal Reserve lending program to help assure banks have the ability to meet the needs of all their depositors. And a few days later, 11 banks announced they had injected $30 billion in deposits into embattled First Republic Bank.
If Buffett were to end up injecting dollars into the banking system this time, it might reassure depositors that their money is indeed safe, and it might also prompt investors to invest in regional banks or hold their stocks in them.
This week, the regional banking sector was still struggling. There were signs of a comeback on the morning of March 21, however, following the release of Treasury Secretary Janet Yellen’s speech at the American Bankers Association, set to take place later in the day- saying the administration has a plan in place if more banks were to collapse.
“The steps we took were not focused on aiding specific banks or classes of banks. Our intervention was necessary to protect the broader U.S. banking system,” she will say in her speech, according to CNBC. “And similar actions could be warranted if smaller institutions suffer deposit runs that pose the risk of contagion.”
Shares of First Republic closed down 47% on March 20 but were up 18% in pre-market trading. The shares are down a staggering 90% year-to-date.
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>>> Want Passive Income in a Bear Market? 3 Stocks Warren Buffett Bought
Motley Fool
By Chris MacDonald
Mar 18, 2023
https://www.fool.com/investing/2023/03/18/want-passive-income-in-a-bear-market-3-stocks-warr/?source=eptyholnk0000202&utm_source=yahoo-host&utm_medium=feed&utm_campaign=article
KEY POINTS
Apple remains a mainstay holding for Buffett, now comprising 39% of his portfolio.
Louisiana Pacific - Building materials could be an overlooked business, at least according to Buffett.
Buffett is betting on Paramount Global, a company with solid earnings and an impressive dividend yield.
During a bear market, it can be hard to find stocks that offer strong returns without too much risk. However, if the underlying business is sound, the company will continue paying out regular dividends -- income that could be of critical importance in a recessionary or volatile economic environment.
Three stocks that the Berkshire Hathaway CEO has purchased during previous market declines could be suitable investments for those seeking both passive income as well as capital appreciation. That goes double for investors contemplating the probability that we could be headed into a recession, and therefore another bear market, in short order.
Each of these three companies are ones Buffett has recently added to this past quarter, and are among his top holdings to consider buying on dips.
Apple
Most investors who follow Warren Buffett know that he is among the most bullish big-time money managers when it comes to Apple (AAPL -0.55%).
The Oracle of Omaha first bought Apple's stock in 2016, being influenced in his decision by his two deputies, Todd Combs and Ted Weschler. Over the years, Buffett has decried not buying more Apple on dips, providing many such reasons for doing so over the years.
Buffett's view of Apple, as a premium provider of consumer goods to a very loyal clientele, has been on point. Apple's closed-loop ecosystem and focus on quality has led the company to become the leading smartphone provider in the U.S. With over 50% market share in this incredibly powerful segment, Apple has become ubiquitous in most of its key markets. The company's sheer cash flow growth over the years is a testament to the fundamental soundness (or quality) Buffett looks for in his core holdings.
With Apple now comprising approximately 39% of Berkshire Hathaway's portfolio, Buffett is clearly in this position for the long haul. While Buffett has trimmed his Apple position from time to time, his purchases over the years have far outweighed his divestitures, providing Berkshire holders with significant exposure to this world-class gem.
Apple's dividend yield of only 0.6% ($0.92 per share annually) is quite small, relative to the other names on this list. However, this is also a stock that's exploded in value since Buffett started buying in 2016, meaning his realized yield is much higher compared to his base cost than an investor putting fresh capital to work. Indeed, while Apple has raised its dividend distribution over the years, it hasn't quite kept up with its stock price appreciation over time. But for those looking for a mix of passive income and growth, this remains a top pick to consider, in my books.
Louisiana-Pacific
Warren Buffett's current investment in Louisiana-Pacific (LPX) is valued at $339 million. While that would be a whopping investment for most, this position only constitutes roughly 0.1% of Buffett's overall equity portfolio, its 38th biggest holding.
Notably, this rather small position for Buffett still amounts to an ownership stake of roughly 7.3% in Louisiana-Pacific, based on its price at the time of acquisition. This purchase is unique, in that Buffett appears to be taking a stake in another economically sensitive company at a time when most investors are looking to play defense. This provider of building materials such as engineered wood products, siding, and other construction-related items utilized in commercial and residential projects, has somewhat stagnated over the past year, following a post-pandemic boom.
What does Buffett know that we don't? I guess we'll find out. Many know that Buffett is a perma-bull when it comes to the economic outlook for America. This bet, while small in the grand scheme of Berkshire's overall portfolio, appears to reaffirm this view. If homebuilding activity picks up (whether due to a drop in interest rates, or the need to fulfill surging demand from Millennial home buyers), Buffett could be due for a big win.
Louisiana-Pacific has been moving toward a more comprehensive business strategy, increasing its involvement in the repair and renovation market and creating value-enhancing products. Buffett's previous investments in mobile home producers and other companies in this sector suggest he believes the future may be bright for this company.
In the last quarter, Louisiana-Pacific increased its quarterly distribution by more than 9% to $0.24 per share, bringing the stock's overall dividend yield to 1.7%. For those bullish on the company's business model looking forward, this is a company that could be poised for continued dividend growth over time, making Louisiana-Pacific an intriguing passive income stock from this perspective right now.
Paramount Global
Another relatively recent investment made by Berkshire is Paramount Global (PARA), a leading global media and entertainment giant. For Buffett, this pick appears to be a way to play declining interest in conventional media names, at a time when streaming and innovation is looking to disrupt this overall sector. Over the past year alone, Paramount has lost roughly 30% of its value, and much more from its 2021 peak.
Paramount does have its own streaming network, Paramount Plus. Accordingly, this isn't a company that's completely falling behind its peers in monetizing its offerings in different ways. The company's impressive release of Top Gun: Maverick last year certainly provided investors with the idea that perhaps the franchises this outfit owns aren't completely washed up. (This movie was the highest-grossing film at the domestic box office last year, and quite good, if I don't say so myself.)
Paramount's performance at the box office was notable, putting forward 10 films, six of which debuted at the No. 1 spot, with the company earning more than $2 billion in ticket sales. Top Gun: Maverick brought in the lion's share of that take, with $1.5 billion in ticket sales, but it proves what solid media franchises may be worth as stand-alone businesses.
The question many investors have with Paramount is how its streaming platform will perform moving forward. Paramount Plus does hold a considerable library of content, including more than 30,000 television episodes from CBS, BET, Nickelodeon, MTV, Comedy Channel, and Paramount Pictures. Its film library is also impressive, leading to many investors attempting to value this business on the basis of its content alone.
It appears Buffett is making the bet that Paramount's streaming platform, along with its library of content (which may be undervalued relative to its peers) could propel this dividend-producing stock higher over time. Such a view would lead one to believe that the company's dividend outlook could be more rosy than what the market is pricing in, making this a unique value, income, and growth bet for the medium- to longer-term.
While Paramount appears to be among the more difficult companies to assess due to its uncertain outlook, this is a company that's profitable, trading at around 21 times earnings, and pays a dividend yield of 4.4%. That's the kind of business Buffett clearly likes, and is reason enough for many investors to at least consider this often-overlooked company.
Investing like Buffett for passive income can provide excellent total returns
Buffett is known for his well-timed and prescient stock purchases over the decades. Indeed, these three companies are about as diverse as one could choose. However, they're all stocks Buffett has recently added to, suggesting there's something to be investigated with each.
While Apple is one of my holdings, I would need to dig deeper into Louisiana-Pacific and Paramount. And with the Buffett stamp of approval, these are two stocks I'm now watching closely. I think it's prudent for other investors to do the same.
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>>> Inflation gives Kroger's private brands a boost
Yahoo Finance
by Joe Toppe
March 2, 2023
https://finance.yahoo.com/news/inflation-gives-krogers-private-brands-200726607.html
Kroger Co Says Quarterly Identical Sales Without Fuel Rose 6.2%
Higher-priced foods helped drive Kroger’s upbeat earnings and annual forecast beyond Wall Street’s expectations on Thursday.
The U.S. grocery store also benefited from tighter cost control.
"Several big-name retailers have been cautious in their outlook over the last few weeks, unsure of how more rate hikes might impact everyday budgets, but Kroger’s top team is more upbeat. The supermarket has enjoyed a surge in sales and believes it will continue to benefit from changing shopping habits whilst at the same time being able to control costs because of substantial changes to its supply chain," said Danni Hewson, AJ Bell's head of financial analysis.
The supermarket chain's outlook took experts by surprise after a string of profit warnings from major retailers including Walmart and Target raised concerns about the retail sector's health in 2023. Kroger forecast adjusted per-share earnings between $4.45 and $4.60 for fiscal 2023, above Refinitiv estimates of $4.20.
Same-store sales growth, excluding fuel, is expected to be 1% to 2% in fiscal 2023, below the average estimate of a 2.23% increase.
"We expect to grow revenue by continuing to invest in our customers through competitive pricing and personalization, fresh products, and a better shopping experience," said CFO Gary Millerchip. "In 2023, we expect to build on this momentum and deliver revenue and EPS growth on top of the record results achieved over the past three years."
Millerchip also said the company will increase associate wages. The company plans to invest $770 million more this year to raise hourly wages and improve healthcare benefits for its employee. It had over the past year raised its average hourly wage to $18.
"Keeping hold of employees often means upping their wages and whilst US consumers are trading down and hunting out bargains and own label brands, they are still shopping," said AJ Bell's Hewson.
"We will fund these investments through product mix improvements, cost-saving initiatives, and growth in our alternative profit businesses," Millerchip added.
Kroger has been streamlining its supply chain and sourcing products closer to its distribution centers to drive costs lower, while the usage of automation and support from its more profitable personal finance and media divisions have further boosted earnings.
Kroger’s fourth quarter sales grew to $34.8 billion compared to $33.0 billion for the same period last year. Excluding fuel, sales increased by 5.9%. Operating profit fell 14% to $826 million year-over-year while earnings per share (EPS) came in at 62 cents, down from 75 cents a year earlier.
For the year, total company sales were $148.3 billion, compared to $137.9 billion for the same period last year. Excluding fuel, sales increased by 5.2% compared to the same period last year. Operating profit was $4.1 billion, or $3.06 per share, compared to $3.5 billion, or $2.17 per share.
Albertsons
Kroger said it is aiming to close its $24.6 billion merger with Albertsons in early 2024. The companies have launched integration planning efforts with the goal of preparing for a seamless integration that can be executed on the first day, post transaction close.
The combination is expected to achieve $1 billion of annual run-rate synergies net of divestitures within first four years post-close; with approximately 50% achieved within first two years post close.
The expected average total shareholder return is expected to be well above Kroger's standalone model of 8-11% in the first four years following close.
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Enbridge - >>> Buffett has loaded up Berkshire's portfolio on some oil stocks, but there aren't any midstream energy companies in the mix. His secret portfolio, though, is a different story. NEAM owns a tiny stake in midstream leader Enbridge (ENB).
https://www.fool.com/investing/2023/02/12/3-top-dividend-stocks-in-warren-buffetts-secret-po/
That small position won't move the needle much at all for NEAM and certainly not for Berkshire. However, buying shares of Enbridge could potentially pay off for income investors. With a dividend yield of 6.73%, every $10,000 invested in the stock would make $673 in annual income.
Enbridge's dividend is arguably one of the safest in the energy sector. The company has increased its dividend for 28 consecutive years. Its cash flow also doesn't hinge on volatile oil prices. Nearly all (98%) of Enbridge's cash flow is either based on a cost-of-service model or contracted.
The stock could be ready for a big upswing this year. Enbridge is rapidly expanding into renewable energy, with several new projects in progress.
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Paramount Global - >>> Paramount Global benefits from operating one of only four broadcast networks in the U.S. Its market position ensures broad distribution and large audiences. Its cable networks, which include BET, Comedy Central, MTV, Nickelodeon, and Showtime, are well-diversified across audience demographics, and it’s also the owner of its namesake film and television studios.
https://www.fool.com/investing/stock-market/market-sectors/communication/media-stocks/
The company rebranded its DTC efforts in 2021 and now combines much of Viacom, Paramount, and CBS content into a single streaming service, Paramount+. In Europe, Paramount is partnering with Comcast’s Sky for distribution of Paramount+ in some markets and a co-owned SkyShowtime service in other markets. The partnership should improve consumer awareness and reduce distribution costs.
Paramount is also a leader in the FAST market with Pluto TV. It uses the streaming service, which claims more than 72 million users globally, to further promote its content and paid streaming options.
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T-Mobile US (TMUS) - >>> Among wireless carriers in the United States, T-Mobile US (NASDAQ:TMUS) ranks third in terms of market share. However, among telecom stocks, TMUS has been one of the better-performing names in the space.
TMUS stock is up by double-digits over the past year. This company’s main rivals have delivered a much less stellar performance during this time. Yet even as T-Mobile contends with issues such as a data breach, and as one sell-side analyst (MoffettNathanson’s Craig Moffett) warns of “growth deceleration,” don’t assume it’s all middling returns from here for this B-rated telecom stock.
Growth may slow in the coming year, but T-Mobile is guiding for between 5 million and 5.5 million subscriber additions this year. That’s not all. The company also anticipates billions in additional cost-savings stemming from its 2020 merger with Sprint. Both these factors leave TMUS well-positioned to materially increase earnings in the next few years.
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https://finance.yahoo.com/news/7-great-growth-stocks-buy-110030242.html
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AXP, KO, AAPL, CVX - >>> Investing legend Warren Buffett has plenty of advice on what to own when consumer prices spike.
https://finance.yahoo.com/news/warren-buffetts-13f-hes-leaning-143000306.html
In a 1981 letter to shareholders, Buffett highlighted two business traits that investors should look for when trying to fight inflation: 1) the power to increase prices easily, and 2) the ability to take on more business without having to spend excessively.
Here are four Berkshire holdings that largely boast those characteristics.
American Express (AXP)
In 2021, American Express demonstrated its pricing power as it raised the annual fee on its Platinum Card from $550 to $695.
The company also stands to directly benefit in an inflationary environment.
American Express makes most of its money through discount fees — merchants are charged a percentage of every Amex card transaction. As the price of goods and services increases, the company gets to take a cut of larger bills.
Business is booming. In 2022, the company’s revenue jumped 25% year over year to $52.9 billion.
American Express is the fourth-largest holding at Berkshire Hathaway. Owning 151.6 million shares of AXP, Berkshire’s stake is worth around $27.2 billion.
Berkshire also owns shares of American Express competitors Visa and Mastercard, although the positions are much smaller.
American Express shares currently offer a dividend yield of 1.2%.
Coca-Cola (KO)
Coca-Cola is a classic example of a recession-resistant business. Whether the economy is booming or struggling, a can of Coke is affordable to most people.
The company’s entrenched market position, massive scale, and portfolio of iconic brands — including names like Sprite, Fresca, Dasani and Smartwater — give it plenty of pricing power.
Add solid geographic diversification — its products are sold in more than 200 countries and territories around the globe — and it’s clear that Coca-Cola can thrive through thick and thin. After all, the company went public more than 100 years ago.
Buffett has held Coca-Cola in his portfolio since the late ’80s. Today, Berkshire owns 400 million shares of the company, worth approximately $23.7 billion.
You can lock in a dividend yield of 3.0% on Coca-Cola's shares at current prices.
Apple (AAPL)
No one who spends $1,600 for a fully decked-out iPhone 14 Pro Max would call it a steal. But consumers love splurging on Apple products anyway.
Earlier this month, management revealed that the company’s active installed base of hardware has surpassed two billion devices.
While competitors offer cheaper devices, millions of users don’t want to live outside of the Apple ecosystem. The ecosystem acts as an economic moat, allowing the company to earn oversized profits.
It also means that as inflation spikes, Apple can pass higher costs to its global consumer base without worrying too much about a drop in sales volume.
Today, Apple is Buffett’s largest publicly traded holding, representing more than 40% of Berkshire’s portfolio by market value. Of course, the sheer increase in Apple’s stock price is one of the reasons for that concentration. Over the past five years, shares of the tech gorilla have surged more than 250%.
Apple currently offers a dividend yield of 0.6%.
Chevron (CVX)
One of Buffett’s big moves in 2022 was loading up on Chevron. According to an SEC filing, Berkshire owned $29.3 billion of the energy giant as of Dec. 31 — a significant jump from its stake of $4.5 billion at the end of 2021.
Today, Chevron represents the third-largest public holding at Berkshire.
It’s not difficult to understand why. Even though the oil business is capital intensive, it tends to do very well during periods of high inflation.
Oil — the most heavily traded commodity globally — shot up in the first half of 2022. While it pulled back in the second half, the supply shock caused by Russia’s invasion of Ukraine could keep the commodity in demand.
Strong oil prices benefit oil producers. Chevron reported earnings of $35.5 billion for 2022, which represented a 127% increase from 2021.
The stock is up more than 25% over the last 12 months.
The company returns cash to investors, too. Paying quarterly dividends of $1.51 per share, Chevron has an annual yield of 3.6%.
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>>> Warren Buffett’s Berkshire Hathaway Increases Stake in Paramount Global as Streaming Wars Stay Hot
The billionaire investor's company now owns about 15 percent of Paramount's Class B shares after first disclosing its stake in May.
The Hollywood Reporter
BY ALEX WEPRIN
NOVEMBER 14, 2022
https://www.hollywoodreporter.com/business/business-news/warren-buffett-berkshire-hathaway-increases-paramount-global-stake-1235261648/
Warren Buffett is still betting on Paramount.
The famed investor’s company, Berkshire Hathaway, has increased its stake in Paramount Global in recent months, according to a filing Berkshire made with the Securities and Exchange Commission on Monday.
Berkshire now owns more than 91 million Class B shares in Paramount, making it the largest outside investor, holding about 15 percent of the company’s Class B stock, worth about $1.7 billion as of market close.
Paramount, of course, is controlled via its Class A shares by National Amusements, the holding company run by Shari Redstone.
Still, the significant investment by Buffett is sure to attract further attention. Buffett first revealed that he had bought in to Paramount in May, when he disclosed a stake of about 75 million shares, which was valued at $2.6 billion at the time. Since then, most media and entertainment stocks have fallen in value. Paramount, for example, was trading at $28 per share when Berkshire first bought in, and was at $18.80 as of market close Monday.
Paramount is but one of a handful of media and entertainment-related stocks held by Buffett, who also holds significant stakes in Apple, Amazon, Activision Blizzard, Charter Communications and Liberty Media.
However, Paramount is the only pure-play entertainment company on Berkshire’s list of holdings, suggesting that Buffett thinks it has a chance to compete in the streaming wars … or could be at the top of the list for potential acquirers.
Paramount Plus is facing tough competition from competitors like Netflix and Disney+, which are just now entering the ad-supported streaming space, as well as from Warner Bros. Discovery’s HBO Max.
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>>> Paramount needs 'even greater scale' after messy history
Yahoo Finance
by Alexandra Canal
February 20, 2023
https://finance.yahoo.com/news/paramount-needs-even-greater-scale-after-messy-history-author-134135833.html
Paramount Global (PARA) has been in the spotlight over the last week. Not only for a dismal quarterly earnings report, but also for a new book documenting the various power struggles to control the embattled media company. In "Unscripted: The Epic Battle for a Media Empire," New York Times reporters James B. Stewart and Rachel Abrams break down the drama, dysfunction, and misconduct surrounding the late Sumner Redstone.
In an interview on Yahoo Finance Live last week, Stewart noted the challenges that faced Redstone's daughter Shari as his health declined during the 2010s.
"I think Shari deserves a lot of credit," Stewart said, highlighting the many obstacles the 68-year-old had to overcome in order to not only control Viacom and CBS, but eventually merge the two companies in 2019.
"I think almost everyone agrees that made sense —Viacom and CBS needed greater scale. They probably need even greater scale than they have, but they needed it. They probably needed it sooner," he said.
Sumner Redstone died in August 2020 at the age of 97.
Shari Redstone currently serves as the non-executive chairwoman of Paramount Global, in addition to president of her family's holding company, National Amusements.
The author credited Shari Redstone with the hiring of Bob Bakish as Paramount's CEO, in addition to the company's successful franchises with spinoffs for popular series like "Yellowstone," "Dexter," and "Billions" currently in the works amid the Showtime/Paramount+ rebrand.
Still, Stewart warned streaming "is a scale business" and Paramount might not have enough resources to adequately compete.
"Companies are spending billions on content. You've got to amortize that over large subscriber base — the bigger the better. They're running up against Amazon, Netflix, Disney+ and they're in a second or third tier compared to that," Stewart said.
As a result of Paramount's small size relative to competitors, the company has long been rumored as a potential acquisition target.
The media giant boasts a current market cap of just about $15.5 billion, which pales in comparison to Disney's (DIS) $192 billion and Netflix's (NFLX) $155 billion.
"Consolidation has been the rule in business for a long time, certainly been the rule in media," Paramount CEO Bob Bakish revealed during a UBS media conference late last year. "So, it's hard for me to bet on anything other than consolidation will happen in the future."
Stewart surmised Paramount Pictures could be an attractive asset for a streamer like Netflix, which does not own its own studio.
"Amazon bought MGM, Disney obviously has the Disney studio. That would seem to be an obvious pairing if they could get by the regulators — which is a big if," Stewart said.
He added: "[Another] big obstacle is that the stock price was so depressed. It got down to $15 and Shari, effectively the controlling shareholder, is not going to sell [to] anyone at that price."
Paramount closed at just $24 a share on Friday, up nearly 40% year-to-date but still down about 16% compared to this time last year.
Nevertheless, Stewart said Shari has repeatedly said she would sell at the right price: "She's not determined to cling to mogul status, no matter what."
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Charlie Munger speaks at the Daily Journal's Annual Shareholders Meeting on 2/15/2023 (link below).
His comments on BYD and Chinese companies start ~ 36 minute mark. Other topics include arbitrage (Activision Blizzard), the use of leverage (to buy BYD), what happened with Jack Ma and Alibaba, the potential for conflict over Taiwan (has decreased), the semiconductor sector, crypto, shorting, Costco, taxing stock buybacks, the eventual break-up of Berkshire, future performance of investing in general (more difficult because valuations are higher, governments will be more anti-business, higher taxes), effects of higher interest rates ('just one more damn thing to adapt to'), higher inflation (inevitable due to politics in a democracy), and how inflation encourages owning stocks rather than government bonds. And lots more -
>>> Berkshire Hathaway sells $138.9 million of shares in China's BYD
Investing.com
Feb 09, 2023
https://www.investing.com/news/stock-market-news/berkshire-hathaway-sells-1389-million-of-shares-in-chinas-byd-2999084?dicbo=v2-0gmswjb
HONG KONG (Reuters) - Berkshire Hathaway, the investment company owned by Warren Buffett, has sold 4.235 million Hong Kong-listed shares of electric vehicle maker BYD for HK$1.09 billion ($139 million), a stock exchange filing showed.
The sale on February 3 lowered Berkshire's holdings in BYD's issued H-shares to 11.87% from 12.26%, the filing to the Hong Kong Stock Exchange on Thursday showed.
($1 = 7.8497 Hong Kong dollars)
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American Express - >>> How Warren Buffett's Berkshire Hathaway came to own 20% of American Express
Yahoo Finance
by Tanya Kaushal
January 29, 2023
https://finance.yahoo.com/news/warren-buffett-berkshire-hathaway-own-20-of-american-express-173821038.html
American Express (AXP), one of the world's top credit card companies, has also long been a favorite of Berkshire Hathaway (BRK-A, BRK-B) CEO Warren Buffett.
"You can't create another American Express," Buffett told Bloomberg in December. "I could create another shoe store. I could create another business publication. I could do all kinds of things with hundreds of billions of dollars. But I can't put in the minds of people what is in their minds about American Express."
As of September 29, 2022, Berkshire held 151,610,700 AmEx shares, or 20.29% of the total. At the end of 2021, AmEx was Berkshire's largest securities holding by weight and third-largest holding by market cap, with its stake valued at $24.8 billion — which grew to $26.1 billion by September 29, 2022.
In 2022, Berkshire built a stake of at least 20.2% of Occidental Petrleum (OXY) and obtained regulatory approval to buy up to 50% of the oil giant's common stock. So while AmEx may no longer be Berkshire's largest holding by weight, the company's value to Berkshire is clear.
“It's sort of like a Good Housekeeping seal of approval," American Express CEO Stephen Squeri told Yahoo Finance recently. "Warren and Berkshire are iconic investors, and to have him speak about the brand and speak about the company, and to speak about the direction that we're going so enthusiastically [is important]."
In 2020, when the pandemic hit, AmEx stock declined to as low as $66 as lockdowns and travel bans dragged down profits by 39%. But Buffett retained his stake in the company, even as he sold airline and bank stocks.
AmEx was able to rebound after enduring the COVID-induced economic downturn and reached its highest price in decades at $196 a share in 2022.
That momentum has carried over into 2023: AmEx's latest quarterly results showed a slight miss for its fourth quarter, but the company indicated it remains positive on its outlook for the remainder of the year.
How Buffett acquired his stake in AmEx
Although AmEx's brand emerged from the pandemic in a position of strength, that hasn't always been the case.
Buffett's interest in AmEx began in the 1960s, during the first wave of consumer credit via banks. For American Express, it wasn't without a bit of controversy.
In 1963, Anthony De Angelis, the founder of Allied Crude Vegetable Oil Company, used his company's inventory as collateral for loans from more than 50 companies, including AmEx. De Angelis used these loans to drive up prices in the soybean oil market and increase the value of Allied.
Eventually, a whistleblower came forward claiming that Allied was misleading AmEx to get more loans by filling up oil tanks with water. This was proven to be true and De Angelis filed for bankruptcy and went to prison for seven years. The impropriety became known as the "salad-oil scandal" and mounted concerns on Wall Street as AmEx now had to pay Allied's bill.
"Every trust department in the United States panicked," Buffett said about the scandal. "I remember the Continental Bank held over 5% of the company and all of a sudden not only do they see that the trust accounts were going to have stock worth zero, but it could get assessed. The stock just poured out, of course, and the market got slightly inefficient for a short period of time."
Buffett used the opportunity to acquire 5% of AmEx for roughly $20 million.
The credit card boom of the '70s and '80s made AmEx a top player in the market. By the late '90s, two-thirds of American households had a credit card. Buffett could now go all out and make his first large stake in the company in 1991 with $300 million.
Within seven years, Buffett owned more than 50 million shares of the company. Berkshire Hathaway hasn't purchased any American Express stock since the late 1990s, but its stake in AmEx has continued to increase as a result of stock buybacks.
Between 1998 and 2005, Berkshire's stake climbed from 11.2% to 12%. In 2020, AXP became Berkshire's largest holding by percentage.
And even though AmEx had a rough start to 2016 financially, Buffett stood by his investment.
“Now we own 20% of American Express,” Buffett said at the 2022 Annual Berkshire Hathaway Shareholders Meeting. “That happens to have worked out extremely well. If they overpaid for the stock and all that — it doesn’t solve every problem — but it’s a wonderful thing if you’ve got an asset you like and they take your ownership interest up.”
AmEx's pandemic revamp
One of American Express's greatest assets has been its perception as a status symbol, which has endured after undergoing a series of rebranding efforts.
The company has a simple revenue model: Most of its revenue is generated from interest from balances and fees from cardholders and from merchants. Merchants are charged more than AmEx competitors such as Visa (V) or Mastercard (MA) because AmEx cardholders tend to be wealthier and spend more, which benefits merchants down the line.
AmEx also collects revenue from the data it gathers on cardholder spending, which is used to target marketing and provide offers to customers. That has, in turn, helped AmEx capture the interest of millennial and Gen Z consumers in recent years as the company has evolved from being a traditional luxury credit card provider to a digital payment provider.
AmEx rebranded its Platinum card as a "lifestyle card" by increasing its fees and at-home perks and dove into e-commerce and food delivery services with by increasing rewards. Since the strategic changes went into effect, the company doubled its number of Platinum cardholders, with millennials and Gen Z customers making up roughly 60% of all new consumer cardholder growth.
And as pandemic restrictions were lifted, AmEx grew its global reach with new travel benefits. They offered more rewards, points, and a new Centurion airport luxury lounge. AmEx's payment method is now accepted on most websites in over 178 countries, according to Statista.
“This whole concept of generational relevance is huge for us," Squeri told Yahoo Finance. "We'll continue to modify our products and add value to our products that not only speaks to millennials but speaks to Gen Xers and speaks to Boomers. Millennials and Gen Zers are the fastest-growing segment that we have.”
The AmEx CEO also stressed that Buffett "gets it right" as AmEx's largest shareholder.
"He gets that the AmEx brand is special," he said. "He tells me that all the time. We both agree the customer base is special. Anybody that has Warren as their largest shareholder would be pretty happy."
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>>> The Power Of No: Why You Need To Say “No” More
https://www.wealest.com/articles/power-of-no
“The difference between successful people and really successful people is that really successful people say no to almost everything.”
— WARREN BUFFETT
Time is your most important asset. It can’t be replenished, it can’t be stored for use later, and once it’s gone… it’s gone for good.
That’s why you have to learn to say NO. If you don’t, other people’s priorities will become yours. And you’ll constantly wonder why you don’t have enough time or energy to build something for yourself.
Derek Sivers: Hell Yes Or No.
Author and entrepreneur Derek Sivers has as simple way to filter opportunities. If you’re not jumping up and screaming “hell yes!” when you first hear about it, then say no.
This is because if you’re not really enthusiastic at the beginning, there’s almost no chance you’re going to be pumped about it in the middle or the end. So don’t do it.
Sivers writes on his blog:
“When deciding whether to do something, if you feel anything less than ‘Wow! That would be amazing! Absolutely! Hell yeah!’ — then say no. When you say no to most things, you leave room in your life to really throw yourself completely into that rare thing that makes you say ‘HELL YEAH!’… We’re all busy. We’ve all taken on too much. Saying yes to less is the way out.”
This could relate to all sorts of things: business opportunties, meetings, new projects with friends, events in your area. If you’re not babbling about how awesome this is and how excited you are, skip it.
There’s a project out there just for you. But you have to keep your slate clean enough to notice it and then jump on it when it comes.
Warren Buffett: Wait For The Fat Pitch.
Warren Buffett and Charlie Munger built their fortunes by saying no to virtually everything.
You can imagine how many opportunities they evaluate weekly, and yet they say no to the vast majority of them.
That’s because they have the discipline to stick within their well defined circle of competence, and only swing when they get a “fat pitch” - something they are extremely comfortable with, have likely seen before, and can anticipate the outcome landing in their favor.
They focus only on opportunities where the downside is limited and the upside significant, and where probability tells them that the upside scenario is most likely to play out. As Warren Buffett writes:
“The difference between successful people and really successful people is that really successful people say no to almost everything.”
And they do this again and again and again into their 90s. They are still doing it. That’s discipline. That’s saying no to virtually everything else. And that’s the key to their success.
Mohnish Pabrai: Patience Is Your Superpower.
Value investor Mohnish Pabrai follows the same rule. As an avid follower of Buffett, he has this to say about the power of saying no:
“The single biggest advantage a value investor has is not IQ. It’s patience and waiting. Waiting for the right pitch, and waiting many years for the right pitch.”
Patience is universally underrated. The ability to wait patiently first for an opportunity, and then for an outcome you believe is likely to play out over the course of several years is the difference between small wins and massive victories.
Naval Ravikant: If You Can’t Decide, The Answer Is No.
This model is one of my favorites because it’s dead simple to remember.
“If you can’t decide, the answer is no.”
Naval Ravikant advises that if you are undecided about a major decision like getting married, taking a job, buying a house, moving to a new city, etc., don’t do it.
You don’t want to lock yourself into something if you’re undecided because you actually have far more options than you think you do.
Here’s Naval explaining his model in the book, The Almanack of Naval Ravikant, (edited by Eric Jorgenson):
“If you cannot decide, the answer is no. And the reason is, modern society is full of options. There are tons and tons of options. We live on a planet of seven billion people, and we are connected to everybody on the internet. There are hundreds of thousands of careers available to you. There are so many choices. You’re biologically not built to realize how many choices there are.”
We tend to underestimate the sheer number of potential paths our lives could take. Tim Urban tweeted this photo:
With the caption: “We think a lot about those black lines, forgetting that it’s all still in our hands.”
Don’t lock yourself into a path you aren’t super excited about. There are so many more you could take that will light you up. So say NO more as you wait for your “hell yes.”
And keep going.
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>>> 5 Warren Buffett Stocks to Buy Hand Over Fist in 2023
Motley Fool
By Adria Cimino
Jan 18, 2023
https://www.fool.com/investing/2023/01/18/5-buffett-stocks-to-buy-hand-over-fist-in-2023/?source=eptyholnk0000202&utm_source=yahoo-host&utm_medium=feed&utm_campaign=article
KEY POINTS
The bear market weighed on some of these Buffett favorites -- and that leaves them trading for bargain prices today.
Others defied the bear market.
It's easy to understand why Warren Buffett stocks are popular with investors. First of all, Buffett has scored top performance over time with his holdings. That means it makes sense to follow the billionaire investor's lead and try his stock picks. Second, Buffett stocks are known for offering a quality business at a good price -- and potential for gains over the long term.
Today, buying Buffett stocks could bolster your portfolio whether the market continues to struggle or shifts into bull territory. Here's why: Some Buffett stocks are dirt cheap after getting crushed last year. But they have what it takes to recover as the market improves. They'll offer you growth potential. Other Buffett stocks beat the bear market. They'll offer your portfolio security.
Ready to give them a try? Here are five to buy hand over fist right now.
1. Amazon
Amazon (AMZN 0.14%) is a leader in two high-growth businesses: e-commerce and cloud computing. Over the past year, e-commerce has weighed on Amazon though. Higher inflation increased costs and left shoppers with less buying power. That resulted in disappointing earnings at Amazon.
But there are two bits of good news here: Economic downturns don't last forever. And Amazon has the strength to make it through these tough times -- and go on to thrive.
The company right now is cutting costs where needed and has increased investment in key growth areas. For example, it boosted spending on technology infrastructure by $10 billion last year.
And here's more good news. Amazon Web Services (AWS) -- the cloud computing business -- still is growing sales and operating income in the double digits. This is key because AWS generally makes up most of Amazon's total operating income.
The stock today is trading at its lowest valuation in relation to sales since 2015. That looks cheap considering Amazon's earnings track record and future prospects.
2. Coca-Cola
Coca-Cola (KO -2.74%) climbed 7.4% last year, beating the bear market. But the stock still remains a deal. It trades around its usual valuation -- at about 24 times forward earnings estimates.
What do you get for this price? A company with enormous brand strength, earnings that continue to increase even through tough times, growth potential, and a track record of dividend growth.
The world's biggest nonalcoholic beverage company reported increases in case volume, net revenue, and operating income in the third quarter. And it lifted its full-year guidance.
In spite of Coca-Cola's presence in more than 200 countries, there still is opportunity for the beverage giant to grow. Commercial beverages represent about 30% of drinks in developing countries -- and Coca-Cola's share of that is about 7%. This represents a key growth opportunity for Coca-Cola over time.
As for dividends, Coca-Cola is a Dividend King. That means it's lifted its dividend for at least the past 50 years. The company's rising free cash flow over time indicates that this can continue -- and offer you passive income you can count on.
3. Johnson & Johnson
Johnson & Johnson (JNJ -1.30%) is another Dividend King. It's also another player that beat the market last year. And, like Coca-Cola, in spite of the gains, J&J's valuation still remains reasonable. The stock is trading for only 16 times forward earnings estimates.
So, we've got two things Buffett likes here: dividend growth and a stock price that isn't expensive. And here's another plus: As a healthcare company, J&J's revenue should hold up nicely no matter what the economic situation. That's because people can't put off taking their medication and undergoing certain surgical procedures. This makes J&J a great investment to hold on to when times are tough.
Today, J&J offers us a bonus too. The company is spinning off its lowest-growth business -- consumer health -- to focus on its highest-growth businesses. Those are pharmaceuticals and medtech. Their revenue each gained more than 8% in the recent quarter. This move should result in earnings growth for J&J -- and that could lead the shares higher over time.
4. Procter & Gamble
Procter & Gamble (PG -2.21%) is another great stock to add safety to your portfolio. It's a Dividend King so it's likely to not only bring you passive income annually -- but growth in that income from year to year. In fact, P&G has returned $65 billion to shareholders over the past four years in the form of dividends and share buybacks.
The company also represents a steady player when it comes to earnings because it sells market-leading products many of us use on a daily basis -- such as Tide laundry detergent and Gillette razors.
This brand strength, along with a focus on innovation, helped P&G continue to steadily grow through a changing market -- from pre-coronavirus days to today. From fiscal 2018 through 2022, the company reported an average 6% increase in organic sales -- and on a currency-neutral basis, earnings per share rose 12%.
Today, the stock trades for 26 times trailing-12-month earnings. That's in line with its valuation over time. And that looks like a reasonable price for a company that offers recurrent passive income -- and steady growth.
5. McKesson
McKesson (MCK -0.88%) crushed the market last year. The stock climbed 50%. But it's not too late to get in on this healthcare player. The company has been streamlining its operations to deliver more growth over time. For example, it's divesting its European businesses and increasing its focus in the growth areas of oncology and biopharma services.
McKesson offers even more safety than your usual healthcare player. Here's why. The company distributes medical products and sells services to biotech and pharmaceutical companies. It doesn't develop drugs or devices -- so it doesn't carry the risk of one of these potential products failing during clinical testing.
Yet, the company still offers the security of earnings stability even during tough times. As mentioned, people need their medical treatments no matter what the economy is doing.
McKesson has steadily increased annual revenue over time. And the company recently raised its full-year earnings guidance.
In spite of gains, the stock trades for only 15 times forward earnings estimates. That's a price Buffett -- and you -- probably will love for a company that has what it takes to offer growth and security over time.
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Buffett and Munger discuss real estate -
>>> Why Warren Buffett Likes Banks
GuruFocus.com
June 23, 2020
https://www.yahoo.com/video/why-warren-buffett-likes-banks-170850570.html
Over the past decade, banks have started to play an increasing part in the portfolio of Warren Buffett at Berkshire Hathaway.
Some analysts have reacted with surprise at this. Buffett's circle of competence has always been insurance and fast-moving consumer goods.
However, from my view, banks do seem to fit the template of the sorts of companies Buffett has always liked. What's more, these businesses are relatively easy to understand.
The banking model
The basic bank business model is relatively simple to explain and understand. Depositors entrust their money to the bank at a specific rate of interest. The bank then loans this money out at a rate it believes provides a suitable profit. For example, if the bank paid 0.3% interest on checking accounts, it could loan the money out at a 2% interest rate.
There are some other factors to consider, such as asset and liability matching and duration matching. Still, at its core, the business of banking is all about lending money out at a higher rate than what is paid to depositors.
Using this business model, banks can generate huge returns on tangible capital. Buffett has always been interested in businesses that can earn substantial returns on invested capital, so it makes sense that he'd be interested in banks.
Indeed, the Oracle of Omaha said as much at the 2003 annual meeting of Berkshire's shareholders:
"The question about banking, you know, banking -- if you can just stay away from following the fads, and really making a lot of bad loans, banking has been a remarkably good business in this country.
And there are many -- there are certain banks, I should say -- in this country that are quite large that are earning, you know, maybe 20% on tangible equity. And when you think you're dealing in a commodity like money, that's fairly surprising to me. So, I would say that I guess I've been surprised by the degree to which margins in banking have not been competed away in something as fundamental as money...
Now, part of it is that they push -- they have pushed the loan-to-capital ratios higher than 30 or 40 years ago, but that -- nevertheless they earn high rates of returns. They earn much higher rates of returns on assets alone, and then they have greater leverage of assets-to-capital so that produces returns on capital that really are pretty extraordinary."
These comments help explain the core reasons behind Buffett's interest in bank stocks. In 2003, he also warned of the risks of bad behaviour at banks, specifically lenders taking on too many bad loans or too much leverage.
Bank investors will always be exposed to these sort of risks. As the size of financial institutions has increased, it has become harder and harder for investors to establish how they are generating profits and if there are any weak areas on the balance sheet.
Nevertheless, large banking institutions are relatively protected from bad loans through diversification. They are also significantly better capitalized today than they were before the financial crisis. Regulations have been tightened as part of policymakers' efforts to tidy up the sector.
Low interest rates in recent years have caused problems for financial institutions, but as Buffett explained in 2003, even with interest rates at low levels, banks can still earn attractive returns on tangible capital. Leverage plays a part, and so do economies of scale. The world will always need banks, and our dependence on these financial institutions is only increasing as cash is phased out.
Companies with high returns on tangible capital and attractive long-term prospects are just the sort of businesses that the Oracle of Omaha wants to own.
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Looks like Berkshire will face a big tax increase due to new tax laws -
>>> Warren Buffett's Berkshire Hathaway looks likely to be a top payer of Biden's new corporate tax, study finds
Markets Insider
by Zahra Tayeb
Sep 26, 2022
https://markets.businessinsider.com/news/stocks/warren-buffett-berkshire-hathaway-top-tax-payer-biden-law-2022-9
Buffett's Berkshire Hathaway tops a list of companies that would pay the most under a new tax law.
The 15% minimum tax on corporations means Berkshire Hathaway would've paid $8.3 billion last year.
Amazon, Ford and Ebay are among other firms expected to pay the most in tax, a study finds.
Warren Buffett's Berkshire Hathaway could be a top payer of President Joe Biden's new corporate tax law, according to a new study.
The research, conducted by the University of North Carolina Tax Center, used historical securities filings to establish what companies would have paid if the tax came into effect last year. It found that about 78 companies would be subject to the tax, which altogether, would've raised approximately $31.8 billion.
According to the study, billionaire investor Buffett's company would have coughed up the most in 2021, estimated to pay $8.3 billion, while Amazon trails behind, owing $2.7 billion, based on the companies' last year earnings.
In August, Biden signed a minimum book income tax into law under the Inflation Reduction Act. That enforces a 15% corporate minimum tax targeted at companies that earn more than $1 billion a year.
Earlier in January, Berkshire Hathaway hit a $700 billion market capitalization, but the achievement stopped short of celebration as Buffett struggles to find stocks or businesses at attractive prices. This month alone, the famed investor's company made a $2 billion error by selling Occidental Petroleum stock in 2020 only to pile back in 18 months later.
The misstep comes as aggressive monetary policy by the Federal Reserve in an effort to ward off high inflation batters US stocks. It's caused major US indexes to sell off sharply, with the S&P 500 slipping into bear market territory in June and the Dow Jones Industrial Average hitting its closing low for the year on Friday.
Other top payers of Biden's new tax law include Ford, AT&T and eBay, based on 2021 earnings.
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>>> Warren Buffett has touted Disney's brand, trumpeted Snow White and Mickey Mouse, and bemoaned selling the stock. Here are his 10 best quotes about the media giant.
Market Insider
by Theron Mohamed
Feb 12, 2022
https://markets.businessinsider.com/news/stocks/warren-buffett-berkshire-hathaway-disney-stock-brand-snow-white-mickey-2022-2#:~:text=Warren%20Buffett%20bought%205%25%20of,be%20worth%20%2424%20billion%20today.
Warren Buffett sold a 5% stake in Disney in the 1960s, and cashed in a 3.6% stake in the 1990s.
The investor later said selling was a "huge mistake" and he would like to own the whole company.
Buffett trumpeted Disney's brand power and the enduring appeal of Snow White and Mickey Mouse.
Warren Buffett bought 5% of Disney for a mere $4 million in 1966, and netted a separate 3.6% stake in the media group when it bought Capital Cities/ABC in 1995. The famed investor sold his Disney stock within three years on both occasions; if he'd held onto the combined 8.6% stake, it would be worth $24 billion today.
Buffett has described cashing out as a "huge mistake," and said he would love to own Disney in its entirety. Berkshire Hathaway's billionaire boss has also trumpeted the value of Disney's global and beloved brand, compared Snow White to a renewable oil field, and joked that the benefit of owning Mickey Mouse is not having to pay him.
Here are Buffett's 8 best quotes about Disney, edited for length and clarity:
1. "I first became interested in Disney in 1966, when its market valuation was less than $90 million. At Disneyland, the $17 million Pirates of the Caribbean ride would soon open. Imagine my excitement — a company selling at only five times rides!" (1995)
2. "It's a pretty good trade name. When you think about names around the world, it's very hard to beat the name 'Coca-Cola.' But Disney's got a very, very big name." (1996)
3. "It's kind of nice to be able to recycle Snow White every seven or eight years. You hit a different crowd. It's like having an oil field where you pump out all the oil and sell it. And then it all seeps back in over seven or eight years." (1996)
4. "The nice thing about the mouse is that he doesn't have an agent. He is not in there renegotiating every week or every month and saying, 'Just look at how much more famous I've become in China.' If you own the mouse, you own the mouse." (Buffett was referring to Mickey Mouse and the benefits of having intellectual property.) (1996)
5. "Disney means something to billions of people. You have got something in your mind about Disney. And you don't have it about the ABC Video Company, or 20th Century, or Paramount." (He was emphasizing that parents trust Disney's content to be safe and appropriate for their children.) (1997)
6. "Just think of what somebody would pay if they could actually buy that share of mind of billions of people around the world. You can't do it. You can't do it with a billion-dollar advertising budget, or a $3 billion advertising budget, or by hiring 20,000 super salesmen." (1997)
7. "If I thought the children of the world were going to want to be entertained 10 or 20 years from now, and I was betting on who is going to have a special place in the minds of those kids and their parents, I would probably bet on Disney." (1996)
8. "I would rather start with Disney's hand than anyone else's, by some margin." (He was discussing the mounting competition in children's entertainment.) (1996)
9. "The Disney sale in the '60s was a huge mistake. I should have been buying, forget about holding." (1998)
10. "I wish we owned all of Disney or Coca-Cola or Gillette, but we aren't going to." (Buffett was asked whether he prefers to hold stakes in businesses or own them outright). (1998)
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>>> 3 Warren Buffett Quotes You Probably Haven't Heard that Will Inspire You to Buy More Stocks
Motley Fool
By Mark Blank
Nov 25, 2022
https://www.fool.com/investing/2022/11/25/3-warren-buffett-quotes-you-probably-havent-heard/?source=eptyholnk0000202&utm_source=yahoo-host&utm_medium=feed&utm_campaign=article
KEY POINTS
Buffett believes economic periods like right now are some of the best opportunities to build wealth.
It's better to buy at a good price than wait for a great price.
The S&P 500 has an undefeated track record, and Buffett doesn't believe that will change anytime soon.
If you feel stuck in the mud with your portfolio, these three Buffett quotes will show you why this might be the best time to buy stocks. Investing is a lot like hiking. When you start off, its incredibly exciting and you're full of energy and optimism. But inevitably you reach a point of mental and physical exhaustion. You hit "the wall." If you've been feeling this way lately on your investing journey, you're not alone. It's completely normal. But it's also important to know how to keep yourself going.
Nuggets of wisdom from arguably the greatest investor of all time, Warren Buffett, can be an investing "power bar" of sorts when the going gets tough. Recently, I've been reflecting on these three lesser-known Buffett quotes and have felt the wind return to my stock-buying sails.
1. Tremendous wealth comes out of the worst economic periods
In a 2016 letter to Berkshire Hathaway (BRK.A 0.19%) shareholders, Buffett penned one of his greatest, yet rarely mentioned quotes:
"Every decade or so, dark clouds will fill the economic skies, and they will briefly rain gold."
At 92 years young, Buffett has seen his fair share of economic downturns, and he understands that this is when the greatest opportunities abound. These periods can also be the most difficult times to invest because fear is at an all-time high.
Despite what it may seem, successful investing has much more to do with one's ability to control his or her emotions than it does with intelligence.
You can come up with sophisticated valuation models and brilliant risk-adjusted strategies, but if you can't bring yourself to buy when the market crashes, you're not likely to make much money.
2. Waiting for a better deal can cost you dearly
In a 2009 speech at Columbia University, Buffett imparted some sage advice about waiting for the right price. He said:
"Don't pass up something that's attractive today because you think you will find something better tomorrow."
The price of stocks is very important, as 2022 has taught investors in painful fashion. But you also need to understand there's a cost to leaving your capital on the sidelines for too long.
According to a study by TD Ameritrade and Morningstar, if you'd missed just the 10 best trading days between 2001 and 2020, your compound annual returns would be cut in half.
COMPOUND ANNUAL RETURNS FROM 2001-2020 -
Invested for all 5,036 trading days -- 7.4%
Missed 10 best trading days --- 3.3%
Missed 20 best trading days --- 0.7%
Missed 50 best trading days --- (5.2%)
Even at today's beaten-down prices, it's quite possible stocks could slide further. But stocks can always go down more. As the table above illustrates, there's much greater risk in not investing than trying to perfectly time the bottom.
3. The S&P 500 is undefeated
If there's one thing Warren Buffett likes, it's good, old-fashioned American businesses. He's made much of his fortune by investing heavily in companies like Coca Cola (KO 0.13%), GEICO, and See's Candy.
He doubled down in his conviction in U.S. businesses in a 2020 letter to shareholders:
"Never bet against America. That is as true today as it was in 1789, during the Civil War, and in the depths of the Depression."
Look no further than a zoomed-out chart of the S&P 500 to see the truth in the Oracle of Omaha's statement.
Since its inception, the S&P 500 has returned nearly 24,000%. It did this despite some of the most turbulent periods in our country's history.
While the past is not a guarantee of the future, I'd much rather bet on the S&P 500 setting new all-time highs in the next several years than it never recovering.
Keep your eye on the ball
Don't let the "dark skies" of this current economic period scare you out of investing. If you are allocating money that you won't need in the next three to five years, the stock market is still the best wealth-building strategy at your disposal.
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BRK / Apple - >>> Why Bob Iger’s Ultimate Power Move May Be Selling Disney to Apple
The Wrap
Joe Bel Bruno
November 22, 2022
https://www.yahoo.com/entertainment/why-bob-iger-ultimate-power-193000597.html
Now that Disney CEO Bob Iger has regained the keys to the Magic Kingdom — less than three years after his chosen successor, Bob Chapek, took over — insiders suspect they know how the beloved executive will find a new way to go out on top during his final two-year stint.
“He’s going to sell the company,” one Disney insider who has worked for Iger predicted. “This is the pinnacle deal for the ultimate dealmaker.”
Landing a deal with Apple (or some other megabuyer) would also cement Iger’s legacy. “I think he’d welcome it — he’d be the last CEO of Disney,” a former top Disney executive told TheWrap, noting that the two companies have “similar brand identities” and could benefit from a merger.
Acquisitions are in Iger’s DNA. Under Iger’s leadership, Disney went on a nearly $100 billion shopping spree to buy animation giant Pixar in 2006, superhero juggernaut Marvel in 2009, “Star Wars”-powered Lucasfilm in 2012 and Rupert Murdoch’s 21st Century Fox in 2019. But there was one acquisition he’s publicly lamented as a transformational deal that got away — a combination with the tech powerhouse Apple.
In Iger’s 2019 autobiography “The Ride of a Lifetime,” the executive wrote chapters about his friendship with Steve Jobs. He and his wife, Willow Bay, were close friends with Steve and Laurene Powell Jobs, even spending holidays together and vacationing in Hawaii. He even writes about standing in front of Steve Jobs’ grave when the tech visionary’s wife uttered: “I asked him if we could trust you. And Steve said, ‘I love that guy.’ ”
Iger responds: “The feeling was mutual.”
Yes, there are caveats — chief among them that Jobs died in 2011. And Disney is a big pill to swallow, with a $180 billion market valuation that would easily soar to a $200 billion premium if the studio were to be acquired.
A deal of that size is likely to draw stiff antitrust resistance at a moment when regulators have stepped up efforts to block other recently proposed media megadeals. Paramount Global this week scrapped the $2 billion sale of its Simon & Schuster division to book publishing giant Penguin Random House after a federal judge blocked the deal, while European regulators have launched a probe of Microsoft’s $69 billion offer to purchase gaming giant Activision Blizzard.
Apple CEO Tim Cook, known to be a safe player with relatively few acquisitions under his leadership, might have given Wall Street a big hint in April. During a call with investors, Cook said he would not rule out acquiring a large company, and that the main drive was to secure strong intellectual property and big names.
Hello, Disney?
Disney CEO Bob Iger Lines Up Potential $27 Million Annual Payday
“We are always looking at companies to buy, we acquire a lot of smaller companies and we’ll continue to do that for IP and to incorporate talent,” Cook said. “We don’t discount something larger if the opportunity presents itself. I’m not going to go through my list with you on this call, but we’re always looking.”
Apple, which has been tinkering with a grab in the streaming space with hits like “Ted Lasso,” certainly has the financial firepower to pull off an acquisition of this size. Even as borrowing costs get more expensive with rising interest rates, the Cupertino-based company is sitting on top of a $48.3 billion cash stockpile. Fleshing that out to both cash and investments, the total surges to about $200 billion. That’s 7.4% of all the mad money held by every member of the broad Standard & Poor’s 500 index.
Not to mention that Apple shares have skyrocketed since Iger and Jobs first did business together. Disney bought the Jobs-run Pixar in 2006 for $7.4 billion, which put the animation studio’s CEO on the entertainment company’s 10-member board. On the day the deal was announced, Apple was trading at about $3 a share and Disney at $25.
Apple is now trading at $150, up 238% in the past five years. Disney, at $96, is down 6% during that same period.
A rep for Disney had no comment; an Apple rep did not respond to requests for comment.
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>>> Warren Buffett Stocks: Berkshire Hathaway Bought 3 New Stocks In Q3, Sold These Others
Investor's Business Daily
by APARNA NARAYANAN
11/15/2022
https://www.investors.com/news/warren-buffett-stocks-buys-sells-berkhire-hathway-q3-2022-13f/?src=A00220
Warren Buffett's Berkshire Hathaway (BRKB) bought shares of Taiwan Semiconductor (TSM) for the first time during the third-quarter bear market, while dumping Store Capital (STOR) entirely.
What Warren Buffett Bought, Sold In Q3
Buffett-led Berkshire picked up roughly 60 million shares of Taiwan Semiconductor worth more than $4.1 billion, according to Berkshire's latest 13F filed late Monday, as tracked by whalewisdom.com.
In October, Taiwan Semi, also known as TSMC, the world's largest contract chipmaker, delivered a Q3 beat-and-raise, defying weakness in the chip sector. TSM stock surged 9.6% to 80.89 on the stock market today, extending last week's rally above the 50-day moving average.
Besides Taiwan Semi, Berkshire Hathaway opened positions in Louisiana Pacific (LPX) and Jefferies Financial Group (JEF) during the Q3 bear market. Berkshire bought 5.8 million shares of Louisiana Pacific, a manufacturer of engineered wood building products, worth nearly $297 million. It bought roughly 433,000 shares of Jefferies Financial Group, a global investment banking and capital markets firm, worth $12.8 million.
LPX stock soared 9.7% to 64.54 Tuesday, vaulting above the 200-day moving average. JEF stock rose 2.9% to 37.91 Tuesday.
During Q3, Berkshire grew existing stakes in several stocks: in Occidental Petroleum (OXY) by 22%; Paramount Global (PARA) by 16%; RH (RH), formerly Restoration Hardware, by 8%; Celanese (CE) by 6%; and Chevron (CVX) by 2%. The conglomerate bought 35.8 million more shares of OXY stock, 12.8 million more shares of PARA stock and 3.9 million more shares of CVX stock.
While exiting Store Capital last quarter, Berkshire reduced existing holdings in several stocks: in U.S. Bancorp (USB) by 55%; Bank of New York Mellon (BK) by 14%; Activision Blizzard (ATVI) by 12%; General Motors (GM) by 5%; and Kroger (KR) by 4%.
On Sept. 15, Store Capital, a real estate investment trust or REIT, announced it is being acquired by GIC, a global institutional investor, and funds managed by Oak Street, in an all-cash deal valued at $14 billion.
The Q3 Berkshire earnings report on Nov. 5 had already revealed that Buffett was a net buyer of stocks, including OXY stock, during a volatile Q3. But investors had awaited the 13F filing, which arrived Monday after the market close, to learn more about which stocks Buffett bought and sold last quarter.
The S&P 500 index ended Q3 in bear market territory for a second consecutive quarter.
Top Berkshire Hathaway Stock Holdings
In Q3, Berkshire kept several top holdings in Warren Buffett's Dow stocks-heavy portfolio steady, according to the 13F filing late Monday.
The conglomerate's top stock holding by market value is Apple (AAPL), with the stake worth a whopping $123.66 billion at the end of September. But Bank of America (BAC) is the No. 1 stock by number of shares held, with AAPL stock at No. 2 by that metric. In addition, American Express (AXP), Coca Cola (KO) and Kraft Heinz (KHC) count among Buffett's biggest stock holdings by number of shares.
A smaller but notable holding is Amazon (AMZN). Berkshire maintained positions in each of these holdings last quarter.
Warren Buffett has a long-term track record of beating the market with his picks. The Berkshire chief has earned a reputation as a buy-and-hold investor, holding stocks for years or even decades. The company has held AAPL stock since Q1 2016 and KO stock since Q1 2001, for example.
Investors track Berkshire's 13F filings to see where the investing legend is putting his money to work in the stock market. A new Warren Buffett stock buy can send shares of that company soaring.
In Q3, Warren Buffett's stock purchases exceeded stock sales by $3.7 billion, including $2 billion invested in OXY stock. Berkshire Hathaway also repurchased $1.05 billion of its own shares.
Amid Q3 volatility, Berkshire recorded a $10.5 billion loss on equity investments. Meanwhile, its cash hoard grew from $105.4 billion at the end of June to $109 billion at the end of September.
Thus far in 2022, Berkshire has picked up the pace of investment activity. It notably raised its energy bet following the Feb. 24 Russian invasion of Ukraine, which disrupted global oil and gas supplies. In 2021, Berkshire Hathaway mostly played defense as the stock market marched higher.
B-class shares of Berkshire stock gained 1.4% to 313.07 on the stock market today. Apple stock advanced 3.2% to 153.02.
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BYD - >>> Warren Buffett Cuts Stake in China’s BYD, Spurring Bets More May Come
Bloomberg
by Katrina Nicholas and Ishika Mookerjee
August 30, 2022
https://finance.yahoo.com/news/warren-buffett-cuts-stake-china-101042396.html
(Bloomberg) -- Warren Buffett’s Berkshire Hathaway Inc. trimmed its stake in BYD Co., just over a month after speculation the legendary US investor was preparing to shed his entire position in the Chinese carmaker sent its stock plummeting.
Berkshire cut its holding in BYD’s Hong Kong-listed shares to 19.92% from 20.04% on Aug. 24, according to an exchange filing Tuesday. That equated to around 1.33 million securities at an average HK$277.10 ($35.30) apiece, valued at about $47 million.
Theories about Buffett’s plans have swirled since a 20.49% stake -- identical to the size of Berkshire’s last reported BYD position in Hong Kong as of December -- entered the Central Clearing and Settlement System last month. The move triggered the biggest slump in BYD stock in nearly two years.
A BYD spokesperson wasn’t immediately able to comment Tuesday, while representatives for Berkshire to date haven’t commented. The shares closed slightly lower at the end of Hong Kong trading.
This is “most likely profit taking,” said Kerry Goh, chief investment officer at Kamet Capital Partners Pte. in Singapore. “BYD has done very well for them especially in the last three years. It’s not their style to sell just because someone says China is uninvestable.”
Asked if Buffett could be gearing up to sell more of his BYD holding, Goh said it was hard to second guess the titan of investing.
When Buffett sold shares in another of his Chinese investments, PetroChina Co., he did it in stages. The 2007 sale was conducted through at least seven transactions over a period of about three months.
“This may shake the firm belief in BYD shares for a lot of institutional investors,” said Franklin Tang, an analyst at Excel Investment Hong Kong Ltd.
“While there are those that hold a bullish view based on fundamentals, with stock prices having been on a roll there’s bound to be plenty of speculators as well,” Tang said. “This will make the latter very skittish as their conviction was largely based in trusting the judgment of Buffett.”
BYD is one of China’s most-watched automakers. On Monday it reported net income for the six months through June at the top end of guidance as record output and sales shielded it from Covid-related production disruptions and supply-chain pain. BYD could deliver 1.5 million to 2 million vehicles this year as capacity expands to meet a backlog of orders, according to Bloomberg Intelligence analysts Steve Man and Joanna Chen.
The Shenzhen-based automaker is also expanding overseas, announcing sales in seven new markets in recent months including Japan, Thailand and Germany.
Chief to BYD’s success is its vertical integration strategy, which involves not only manufacturing vehicles but producing semiconductors and batteries. It’s now the world’s third-largest producer of batteries for EVs, with 14% of the global market, behind Chinese rival Contemporary Amperex Technology Co. Ltd. and South Korea’s LG Energy Solution Ltd.
And Buffett, a long-time backer of BYD, has certainly ridden the wave. Shares in BYD gained 31% last year and surged 423% in 2020.
Buffett’s investment in the automaker is worth north of $8 billion from around $230 million when he first invested in the company in 2008. The 92-year-old, the chairman and largest shareholder of Berkshire, has a net worth of about $100.2 billion, according to the Bloomberg Billionaires Index.
The BYD position that matched the size of Berkshire’s appeared in Hong Kong’s stock-market clearing system under a Citibank’s account. Since then, Citibank’s holding in BYD’s Hong Kong-listed stock has dropped by around 9 million shares, Hong Kong exchange data show.
Hong Kong regulations state that a shareholder who owns more than 5% of a listed company must notify the stock exchange within three business days of initiating a trade if that trade changes the percentage of the stake into the next whole number.
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#N/A | ATVI | 52,717,075 | 6.7% | #N/A | ||
#N/A | ALLY | 29,800,000 | 9.9% | #N/A | ||
Amazon.com, Inc. | AMZN | 10,666,000 | 0.1% | $105.45 | $1,124,729,700 | #N/A |
American Express Company | AXP | 151,610,700 | 20.4% | $161.34 | $24,460,870,338 | #N/A |
#N/A | AON | 4,396,000 | 2.1% | #N/A | ||
#N/A | AAPL | 915,560,382 | 5.8% | #N/A | ||
#N/A | BAC | 1,032,852,006 | 12.9% | #N/A | ||
#N/A | BK | 25,069,867 | 3.2% | #N/A | ||
BYD Co. Ltd | BYDDF | 119,730,142 | 10.9% | #N/A | ||
#N/A | CE | 9,710,183 | 8.8% | #N/A | ||
#N/A | CHTR | 3,828,941 | 2.3% | #N/A | ||
#N/A | CVX | 167,353,771 | 8.8% | #N/A | ||
#N/A | C | 55,244,797 | 2.8% | #N/A | ||
#N/A | KO | 400,000,000 | 9.2% | #N/A | ||
#N/A | DVA | 36,095,570 | 39.8% | #N/A | ||
#N/A | DEO | 227,750 | 0.0% | #N/A | ||
Floor & Decor Holdings Inc | FND | 4,780,000 | 4.5% | $99.34 | $474,845,200 | #N/A |
#N/A | GM | 50,000,000 | 3.6% | #N/A | ||
#N/A | GL | 6,353,727 | 6.6% | #N/A | ||
#N/A | HPQ | 120,952,818 | 12.3% | #N/A | ||
Itochu Corporation | ITOCF | 98,380,800 | 6.2% | #N/A | ||
#N/A | JEF | 433,558 | 0.2% | #N/A | ||
#N/A | JNJ | 327,100 | 0.0% | #N/A | ||
#N/A | KHC | 325,634,818 | 26.5% | #N/A | ||
#N/A | KR | 50,000,000 | 7.0% | #N/A | ||
#N/A | LILA | 2,630,792 | 5.9% | #N/A | ||
#N/A | LILAK | 1,284,020 | 0.7% | #N/A | ||
#N/A | FWONK | 7,722,451 | 3.7% | #N/A | ||
#N/A | LSXMA | 20,207,680 | 20.6% | #N/A | ||
#N/A | LSXMK | 43,208,291 | 19.8% | #N/A | ||
#N/A | LPX | 7,044,909 | 9.8% | #N/A | ||
#N/A | MKL | 471,661 | 3.5% | #N/A | ||
#N/A | MMC | 404,911 | 0.1% | #N/A | ||
#N/A | MA | 3,986,648 | 0.4% | #N/A | ||
#N/A | MCK | 2,855,514 | 2.1% | #N/A | ||
#N/A | MDLZ | 578,000 | 0.0% | #N/A | ||
#N/A | MCO | 24,669,778 | 13.4% | #N/A | ||
#N/A | NU | 107,118,784 | 2.3% | #N/A | ||
#N/A | OXY | 211,707,119 | 23.6% | #N/A | ||
#N/A | PARA | 93,637,189 | 15.3% | #N/A | ||
#N/A | PG | 315,400 | 0.0% | #N/A | ||
#N/A | RH | 2,360,000 | 10.7% | #N/A | ||
#N/A | SNOW | 6,125,376 | 1.9% | #N/A | ||
#N/A | SPY | 39,400 | 0.0% | #N/A | ||
StoneCo Ltd | STNE | 10,695,448 | 3.3% | $12.32 | $131,767,919 | #N/A |
#N/A | TSM | 8,292,724 | 0.2% | #N/A | ||
#N/A | TMUS | 5,242,000 | 0.4% | #N/A | ||
#N/A | UPS | 59,400 | 0.0% | #N/A | ||
#N/A | USB | 8,098,178 | 0.5% | #N/A | ||
#N/A | VOO | 43,000 | 0.0% | #N/A | ||
#N/A | VRSN | 12,815,613 | 12.3% | #N/A | ||
#N/A | V | 8,297,460 | 0.2% | #N/A | ||
TOTAL | #N/A |
Symbol | Holdings | Stake | Mkt. price | Value | Pct of portfolio | |
---|---|---|---|---|---|---|
Activision Blizzard, Inc. | ATVI | 74,187,400 | 9.5% | $80.49 | $5,971,343,826 | 1.7% |
Ally Financial Inc | ALLY | 8,969,420 | 2.9% | $32.58 | $292,223,704 | 0.1% |
Amazon.com, Inc. | AMZN | 10,666,000 | 0.1% | $140.80 | $1,501,772,800 | 0.4% |
American Express Company | AXP | 151,610,700 | 20.2% | $157.51 | $23,880,201,357 | 6.7% |
Aon PLC | AON | 4,396,000 | 2.1% | $287.53 | $1,263,981,880 | 0.4% |
Apple Inc | AAPL | 911,347,617 | 5.7% | $165.35 | $150,691,328,471 | 42.5% |
Bank of America Corp | BAC | 1,032,852,006 | 12.9% | $33.96 | $35,075,654,124 | 9.9% |
Bank of New York Mellon Corp | BK | 74,346,864 | 9.2% | $43.50 | $3,234,088,584 | 0.9% |
BYD Co. Ltd | BYDDF | 225,000,000 | 7.7% | $36.75 | $8,268,750,000 | 2.3% |
Celanese Corporation | CE | 7,880,998 | 7.3% | $110.85 | $873,608,628 | 0.2% |
Charter Communications Inc | CHTR | 3,828,941 | 2.4% | $462.98 | $1,772,723,104 | 0.5% |
Chevron Corporation | CVX | 159,178,117 | 8.1% | $153.64 | $24,456,125,896 | 6.9% |
Citigroup Inc | C | 55,244,797 | 2.9% | $51.66 | $2,853,946,213 | 0.8% |
Coca-Cola Co | KO | 400,000,000 | 9.2% | $63.38 | $25,352,000,000 | 7.2% |
Davita Inc | DVA | 36,095,570 | 39.5% | $85.68 | $3,092,668,438 | 0.9% |
Diageo plc | DEO | 227,750 | 0.0% | $188.37 | $42,901,268 | 0.0% |
Floor & Decor Holdings Inc | FND | 4,780,000 | 4.5% | $92.92 | $444,157,600 | 0.1% |
General Motors Company | GM | 62,045,847 | 4.3% | $36.06 | $2,237,373,243 | 0.6% |
Globe Life Inc | GL | 6,353,727 | 6.4% | $97.88 | $621,902,799 | 0.2% |
HP Inc | HPQ | 121,092,418 | 11.7% | $33.58 | $4,066,283,396 | 1.1% |
Itochu Corporation | ITOCF | 81,304,200 | 5.6% | $27.37 | $2,225,295,954 | 0.6% |
Johnson & Johnson | JNJ | 327,100 | 0.0% | $171.11 | $55,970,081 | 0.0% |
Kraft Heinz Co | KHC | 325,634,818 | 26.6% | $37.57 | $12,234,100,112 | 3.5% |
Kroger Co | KR | 57,985,263 | 8.1% | $47.25 | $2,739,803,677 | 0.8% |
Liberty Latin America Ltd Class A | LILA | 2,630,792 | 5.6% | $7.24 | $19,046,934 | 0.0% |
Liberty Latin America Ltd Class C | LILAK | 1,284,020 | 0.7% | $7.16 | $9,193,583 | 0.0% |
Liberty Media Formula One Series C | FWONK | 7,722,451 | 3.8% | $62.89 | $485,664,943 | 0.1% |
Liberty Sirius XM Group Series A | LSXMA | 20,207,680 | 20.4% | $41.08 | $830,131,494 | 0.2% |
Liberty Sirius XM Group Series C | LSXMK | 43,208,291 | 19.6% | $40.96 | $1,769,811,599 | 0.5% |
Markel Corporation | MKL | 424,343 | 3.1% | $1,167.94 | $495,607,163 | 0.1% |
Marsh & McLennan Companies, Inc. | MMC | 404,911 | 0.1% | $165.60 | $67,053,262 | 0.0% |
Mastercard Inc | MA | 3,986,648 | 0.4% | $357.51 | $1,425,266,526 | 0.4% |
McKesson Corporation | MCK | 2,921,975 | 2.0% | $346.69 | $1,013,019,513 | 0.3% |
MONDELEZ INTERNATIONAL INC Common Stock | MDLZ | 578,000 | 0.0% | $63.77 | $36,859,060 | 0.0% |
Moody’s Corporation | MCO | 24,669,778 | 13.4% | $311.07 | $7,674,027,842 | 2.2% |
Nu Holdings Ltd | NU | 107,118,784 | 2.3% | $4.49 | $480,963,340 | 0.1% |
Occidental Petroleum Corporation | OXY | 181,684,791 | 19.5% | $59.01 | $10,721,219,517 | 3.0% |
Paramount Global Class B | PARA | 68,947,760 | 11.3% | $24.26 | $1,672,672,658 | 0.5% |
Procter & Gamble Co | PG | 315,400 | 0.0% | $144.72 | $45,644,688 | 0.0% |
RH | RH | 2,170,000 | 8.8% | $286.87 | $622,507,900 | 0.2% |
Royalty Pharma plc | RPRX | 1,496,372 | 0.2% | $42.45 | $63,520,991 | 0.0% |
Snowflake Inc | SNOW | 6,125,376 | 1.9% | $165.53 | $1,013,933,489 | 0.3% |
SPDR S&P 500 ETF Trust | SPY | 39,400 | 0.0% | $413.47 | $16,290,718 | 0.0% |
StoneCo Ltd | STNE | 10,695,448 | 3.3% | $11.07 | $118,398,609 | 0.0% |
Store Capital Corp (acquired) | STOR | 14,754,811 | 5.3% | $27.90 | $411,659,227 | 0.1% |
T-Mobile Us Inc | TMUS | 5,242,000 | 0.4% | $144.56 | $757,783,520 | 0.2% |
United Parcel Service, Inc. | UPS | 59,400 | 0.0% | $196.76 | $11,687,544 | 0.0% |
US Bancorp | USB | 144,046,330 | 9.7% | $47.39 | $6,826,355,579 | 1.9% |
Vanguard 500 Index Fund ETF | VOO | 43,000 | 0.0% | $379.98 | $16,339,140 | 0.0% |
Verisign, Inc. | VRSN | 12,815,613 | 11.9% | $198.70 | $2,546,462,303 | 0.7% |
Verizon Communications Inc. | VZ | 1,380,111 | 0.0% | $44.95 | $62,035,989 | 0.0% |
Visa Inc | V | 8,297,460 | 0.4% | $215.87 | $1,791,172,690 | 0.5% |
TOTAL | $354,252,534,978 | 100.0% | ||||
Berkshire Cash as of 31 Mar 22: $106.3 billion |
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