Connect with us

Hi, what are you looking for?

Economy

Berkshire’s cash soars to $325 billion as Buffett sells Apple, BofA; operating profit falls

By Jonathan Stempel

(Reuters) -Warren Buffett and Berkshire Hathaway (NYSE:BRKa) extended their retreat from stocks in the third quarter, slashing their holdings in Apple and boosting cash to a record $325.2 billion.

Berkshire also reported a 6% decline in quarterly operating profit, largely the result of higher insurance underwriting liabilities including for Hurricane Helene, and currency losses from a strengthening U.S. dollar.

These offset improved profitability at the Geico car insurer, where accident claims and expenses fell. Profit also rose at the BNSF railroad, which shipped more consumer goods, and Berkshire Hathaway Energy, where operating expenses declined.

In its quarterly report on Saturday, Berkshire said it sold about 100 million, or 25%, of its Apple shares (NASDAQ:AAPL) over the summer, ending with about 300 million.

It has now sold more than 600 million of the iPhone maker’s shares in 2024, though Apple remained Berkshire’s largest stock holding, at $69.9 billion.

The sales comprised a large portion of the $36.1 billion of stock, including several billion dollars of Bank of America shares, that Berkshire sold in the quarter.

Buffett said in May that he expected Apple to remain Berkshire’s largest stock investment, but selling made sense because the 21% federal tax rate on the gains would likely grow.

Berkshire bought just $1.5 billion of stock in the quarter, the eighth straight where it was a net seller of stocks.

It also repurchased none of its own stock, suggesting that Buffett doesn’t view even his own company’s shares as a bargain.

HELENE, MILTON

Operating profit from Berkshire’s dozens of businesses fell to $10.09 billion, or about $7,019 per Class A share, from $10.76 billion a year earlier.

Insurance underwriting profit fell 69%, dented by rising claims, $565 million of losses from Helene, and a bankruptcy court settlement related to defunct talc supplier Whittaker Clark & Daniels.

This more than offset a near doubling of underwriting profit at Geico.

Berkshire also projected $1.3 billion to $1.5 billion of pre-tax losses in the fourth quarter from Hurricane Milton, which slammed into Florida in October.

Net income totaled $26.25 billion, or $18,272 per Class A share, compared with a loss of $12.77 billion, or $8,824 per share, a year earlier when falling stock prices reduced the value of Berkshire’s investments.

Buffett has said operating results better reflect Berkshire’s performance.

Accounting rules require Berkshire to report unrealized investment gains and losses when it reports net income, adding volatility that Buffett counsels investors to ignore.

Buffett, 94, has led Berkshire since 1965, and is expected to eventually transfer leadership to Vice Chairman Greg Abel, 62.

The Omaha, Nebraska-based conglomerate’s businesses also include Berkshire Hathaway Energy, many industrial and manufacturing companies, a big real estate brokerage, and retail businesses such as Dairy Queen and Fruit of the Loom.

This post appeared first on investing.com

You May Also Like

Investing

Fisker (NYSE: FSR) stock price has been one of the best-performing electric vehicle (EV) stocks this week even as Tesla slumped. The shares jumped...

Investing

Newmont (NYSE: NEM) reported mixed financial results even as the price of gold approached its all-time high. In all, the company’s earnings per share...

Investing

The Fox Corporation (NASDAQ: FOX) stock price has been under pressure as investors come to terms with the abrupt firing of Tucker Carlson. The...

Investing

NatWest (LON: NWG) share price rose sharply, helped by the strong results from Barclays. The stock jumped to a high of 274.8p, which was...




Disclaimer: Oldamericanbroker.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the-company.


Copyright © 2024 Oldamericanbroker.com