Berkshire Hathaway

  • The update reflected the listed portfolio of equities increasing from $215 billion to $242 billion, increasing by 13%, with the three largest investments making-up 52% of the portfolio.

  • As a long term investor, Warren Buffet, rarely makes significant changes to the portfolio, although there are 49 individual shares. These are insignificant in the overall context.

  • The top five investments are, Apple, Bank of America, Coca-Cola, American Express and Wells Fargo. New introductions include Kroger, a retail business, and Mr Buffet increased positions in Occidental Petroleum and Suncor.

  • The investment in Apple shares has been trimmed, but was still around 30% of the portfolio at the time of reporting, and was purchased at between $93 and $110 a share in 2016. This is the largest single equity in the portfolio. In addition there are a number of holdings in the airline industry, as well in financial services.

  • Berkshire Hathaway recently released its annual letter to shareholders, containing details of succession plans, as well as share repurchases being actively being undertaken.

  • With both Warren Buffet and Charlie Munger both at advanced ages, it appears that there are two leading contenders to take over, with Ajit Jain and Greb Abel the named candidates.

  • Jain, is the executive in charge of the major operating entity of the Insurance operations, whilst Abel runs the non-insurance operations, underpinned by a strong board of directors, responsible for the successful strategy of this major conglomerate.

  • Buffet revealed that during 2019 the company repurchased $5 billion of Berkshire shares, a significant increase from the past, which represents a major change in strategy.

  • This could be due to the company not finding any large scale acquisitions at the right price, and this action might address the underperformance relative to that of the S& P 500. Buffet presented a plan that on his passing, his large shareholdings will not result in a disruption and forced sales in the market.

Berkshire Hathaway