Buffett Warren

Warren Buffett donates $2.9 billion to Gates Foundation, family charities – Reuters

(Reuters) – Warren Buffett has donated roughly $2.9 billion of Berkshire Hathaway Inc stock to four family charities and the Bill & Melinda Gates Foundation, the latest but not largest contribution in his plan to give away his fortune.

FILE PHOTO: Berkshire Hathaway Chairman Warren Buffett walks through the exhibit hall as shareholders gather to hear from the billionaire investor at Berkshire Hathaway Inc’s annual shareholder meeting in Omaha, Nebraska, U.S., May 4, 2019. REUTERS/Scott Morgan

In a statement on Wednesday, Berkshire said Buffett’s 15th annual donation comprised 15.97 million Class B shares of Berkshire.

It boosted his donations to the charities to more than $37.4 billion since Buffett, who turns 90 on Aug. 30, began giving his Berkshire shares away in 2006.

Four-fifths of the donations go to the Gates Foundation. The rest goes to the Susan Thompson Buffett Foundation, named for Buffett’s late first wife, and charities run by his children Howard, Susan and Peter: the Howard G. Buffett Foundation, the Sherwood Foundation and the NoVo Foundation.

Buffett’s largest donation was $3.61 billion in 2019, when Berkshire’s stock price was higher.

Though Buffett has donated 48% of his Berkshire shares, he still owns 15.5% of the Omaha, Nebraska-based conglomerate and controls 31% of its voting power.

Forbes magazine said on Tuesday that Buffett was still worth $71.4 billion, ranking seventh worldwide. Inc founder Jeff Bezos ranked first at $178.1 billion, while Microsoft Corp co-founder Bill Gates was second.

Gates, a longtime Buffett friend, ended his 16-year run on Berkshire’s board this year to focus on his foundation.

Berkshire stock has significantly lagged broader markets in 2019 and 2020.

This is in part because Buffett has not found attractive major acquisitions and financing opportunities for his $440 billion conglomerate, even during the coronavirus pandemic.

Berkshire owns more than 90 businesses such as BNSF railroad, Geico auto insurance and Dairy Queen ice cream.

It also owns dozens of stocks, including more than $93 billion of Apple Inc based on regulatory filings.

Reporting by Jonathan Stempel in New York; editing by Jonathan Oatis

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Reasons Warren

3 Reasons Why Warren Buffett Is Fearful in Today’s Market – The Motley Fool

The Berkshire Hathaway chief surprised observers by bailing out of some stocks during the biggest crash in over a decade.

Jeremy Bowman

When the coronavirus crisis first started, market watchers were eager to see if Warren Buffett’s Berkshire Hathaway (NYSE:BRK.A) (NYSE:BRK.B) would make a big move. The Berkshire chief has lamented for years that stocks and companies are too expensive, and he hasn’t “bagged an elephant” since his 2015 acquisition of Precision Castparts. The end of an 11-year bull market seemed to present a perfect opportunity from him to make use of the $137 billion Berkshire’s squirreled away.

After Berkshire’s shareholder meeting earlier this month and the company’s 13-F filing revealing its first-quarter stock moves, we now know that Buffett has not made any big purchases. In fact, he’s done the opposite. Buffett’s been a net seller of stocks, ditching his stake in the four major airlines and cutting back on holdings of Goldman Sachs and JPMorgan Chase, even though he’s historically been a fan of bank stocks.  

The man who famously said “Be fearful when others are greedy and greedy when they are fearful” now seems fearful. Based on his recent comments, we have some sense why.

Warren Buffett at a Berkshire Hathaway meeting

Image source: Motley Fool.

There’s a ton of uncertainty out there

Buffett has consistently expressed long-term optimism through the crisis, but he has been more cautious about what the near term holds. In comments at Berkshire’s shareholder meeting in early May, Buffett said:

When we started on this journey, which we didn’t ask for, it seemed to me that it was an extraordinary wide variety of possibilities on both the health side and on the economic side. There was DEFCON 5 on one side and DEFCON 1 on the other side, and nobody really knows, of course, all the possibilities that there are, and they don’t know what probability they are. But in this particular situation, it did seem to me that there was an extraordinary range of things that could happen on the health side and an extraordinary range in terms of the economy.

Buffett went on to acknowledge that the worst-case and best-case scenarios had been eliminated, but there’s still a wide range of possibilities out there — which makes it particularly difficult for a value investor like Buffett to make smart buys, as there’s a wide range of possibilities in future cash flows and earnings. Despite his faith in airlines, for example, Buffett believes that the industry has fundamentally changed. Demand will be down for the foreseeable future, which is especially problematic for an industry with high fixed costs.

Buffett’s right about the uncertainty. Even with the recent announcement from Moderna about a successful phase 1 vaccine trial, we don’t know if there will be an effective vaccine within the next year or two, or even ever. We don’t know if there will be another wave of infections and if businesses will have to close again. The future is especially hard to predict right now.

Prices are still too high

It’s not surprising that Buffett, who has complained about the market being overvalued for the last several years, would still believe that stocks are overpriced. Though prices are still down double-digit percentages from February’s highs, the near-term earnings picture has significantly deteriorated, and the uncertainty clouds the ability to make an accurate forecast.

Asked why Berkshire had not acted as a lender of support as it did several times during the financial crisis, taking favorable stakes in the form of preferred stock and warrants, Buffett said, “Well, we haven’t seen anything attractive.” Buffett added that the Federal Reserve stepped in to support businesses that may have otherwise come to Berkshire for help, saying, “But that means that a lot of companies that needed money and probably should have done their financing a little earlier, but they’re perfectly decent companies, got the chance to finance in huge ways in the last five weeks or thereabouts.”

Buffett said he was getting calls from companies in distress, but didn’t find any of them appealing, so Berkshire has held its purse strings.

Sometimes it pays to wait

Buffett is no fan of market timing, saying that he doesn’t know anyone who can do it, but he did observe that in the last crisis he may have acted too soon. Referring to the purchases Berkshire made in the fall of 2008, Buffett said “Now it turned out that we would have been a lot better off if we’d waited four or five months to do similar things.”

The Berkshire chief also made some of his best deals toward the end of the crisis. For instance, in 2011 he bought $5 billion in preferred stock in Bank of America, yielding 6%, a deal that has netted the company more than $20 billion, including some investments in B of A later on. 

Buffett may sense that better opportunities will present themselves as the crisis plays out. It’s only been about two months since the shutdowns started, so for struggling businesses liquidity is likely to be tighter a few months from now that than it is today.

Cautiously optimistic

Buffett retained his usual optimism about the American economy, saying, “We haven’t faced this exact problem. In fact, we haven’t really faced anything that quite resembles this problem, but we faced tougher problems. The American miracle, the American magic has always prevailed, and it will do so again.”

Indeed, over the long term, U.S. stocks and the economy have always bounced back and continued to grow — and over a five or 10-year horizon, the coronavirus may prove to be just a dip. But Buffett’s cautious tone was noticeable, and it’s clear that there’s a high level of uncertainty ahead. 

Whether Buffett will go elephant-hunting this year remains to be seen, but for now the Oracle of Omaha seems content to keep his powder dry.

Jeremy Bowman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Berkshire Hathaway (B shares) and recommends the following options: long January 2021 $200 calls on Berkshire Hathaway (B shares), short Janua

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Buffett's Warren

Is This Warren Buffett’s Favorite Stock Right Now? – Motley Fool

The famed investor’s Berkshire Hathaway has spent billions buying this stock over the last two quarters — more than it has spent buying shares of any other company.

Warren Buffett, CEO and chairman of Berkshire Hathaway (NYSE:BRK.B)(NYSE:BRK.A), is one the greatest investors of all time. His ability to pick stocks and identify undervalued subsidiaries for Berkshire to acquire has helped the company’s stock price grow at an average rate of about a 20% annualized since 1965 — approximately doubling the S&P 500‘s annualized return over the same timeframe. No wonder investors watch closely when the famed investor makes a move.

While we won’t have the full details on Buffett’s recent purchases until the company releases its 13-F filing this week, one thing is clear: Berkshire Hathaway itself is among Buffett’s favorite stocks to buy lately — and it may even be his top pick.

Warren Buffett at a Berkshire annual shareholder meeting

Warren Buffett. Image source: The Motley Fool.

Spending billions on Berkshire stock

While Berkshire hasn’t revealed all of its stock purchases in Q1 yet, the company did provide an update on its share repurchases in its recently filed quarterly report.  The conglomerate bought back around $1.58 billion worth of its own stock during the quarter. This is a sizable purchase relative to the company’s total purchases during the period. In total, Buffett spent about $4 billion buying stocks in Q1. This means Berkshire represented about 40% of all equities purchases during the period.

Driving home just how much more attractive Berkshire is finding its own stock to buy than other stocks, Berkshire was by far the company’s largest stock purchase in Q4 as well. During the period, Berkshire spent $2.2 billion buying back its own stock — greater than all of its other stock purchases combined during the quarter. Further, this put total repurchases in 2019 at about $5 billion — up from just over $1 billion in 2018.

To be clear, it’s possible that Berkshire spent more than $1.58 billion on a different stock besides Berkshire during Q1. But it’s unlikely given that Berkshire only spent $4 billion total buying securities. However, when you consider this purchase with the $2.2 billion Berkshire spent on repurchases in Q1, Berkshire does seem to be Warren Buffett’s favorite stock as of late.

Berkshire shares appear to be undervalued

What’s notable about Berkshire’s share repurchases is that they actually mean something. Unlike many companies that buy back shares no matter where the stock is trading, it’s Buffett’s policy to only buy back shares when he believes they are meaningfully undervalued. The fact that Berkshire has been a top stock purchase recently speaks volumes about Buffett’s view of Berkshire stock.

To this end, the price-to-book value of Berkshire stock is significantly lower than it has been in years. In fact, the last time Berkshire had a price to book value ratio below 1.2 was the beginning of 2013. Today, Berkshire has a price-to-book ratio of about 1.1.

While this ratio offers only one view of Berkshire’s stock, the main remains: Buffett clearly sees meaningful value in his own company’s stock. In fact, his purchase history over the last two quarters implies it may be the famed investor’s favorite stock.

Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Berkshire Hathaway (B shares) and recommends the following options: long January 2021 $200 calls on Berkshire Hathaway (B shares), short January 2021 $200 puts on Berkshire Hathaway (B shares), and short June 2020 $205 calls on Berkshire Hathaway (B shares). The Motley Fool has a disclosure policy.


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Trump Warren

Trump says Warren ‘responsible’ for Biden’s candidacy, should make her VP pick – New York Post

May 4, 2020 | 9:46pm | Updated May 5, 2020 | 4:47am

WASHINGTON — President Trump has announced his unlikely pick for Joe Biden’s veep: Elizabeth Warren.

In an interview with The Post in the Oval Office on Monday, Trump said he believed the presumptive Democratic nominee “owes” the Massachusetts senator the top spot on his ticket because he never would have gotten this far without her help.

“I think Elizabeth Warren is responsible for Joe Biden’s win because she didn’t drop out and [Vermont Sen.] Bernie [Sanders] would have won every single state on Super Tuesday,” Trump said, claiming Warren split the progressive vote.

“I think he should pick Elizabeth Warren because Elizabeth Warren, more than any other person, including [South Carolina Rep.] Jim Clyburn and including anybody you can name, is responsible for the win of Joe Biden,” he continued, referring to Clyburn’s campaign-reviving February endorsement of Biden.

Trump also questioned whether the former vice president, 77, would actually wind up his party’s nominee.

“If he’s gonna win — and I don’t know that he makes it to the starting gate — but if he does make it to the starting gate, [Warren is] responsible,” he said.

Joe BIden and Elizabeth Warren.
Joe BIden and Elizabeth Warren.Reuters

“She was responsible for his win so therefore I think he owes an obligation to pick Pocahontas,” he said, using his favorite taunt for Warren due to her past tenuous claims of Native American ancestry.

A number of female Democratic lawmakers are furiously lobbying to become Biden’s running mate after he pledged to select a woman for vice president.

No one is campaigning more blatantly than Stacey Abrams but Trump dismissed her efforts, saying that he was largely responsible for her defeat in the 2018 Georgia gubernatorial election.

“If you look at Stacey Abrams, I was the one that went to Georgia and fought Oprah Winfrey, Barack Obama, Michelle Obama,” he said, referring to Abrams’ star endorsements.

“[Gov. Brian] Kemp wasn’t given a chance. Kemp wasn’t given a chance to win and he won,” the president continued.

“They were there all the time campaigning for Stacey Abrams, their new great star. That didn’t work out too well,” he said,

Biden insiders have also dismissed Abrams’ campaigning for the coveted role — telling The Post: “No one takes Stacey seriously.”

“And her public campaigning for the job seems more like a hostage negotiation than an actual attempt to get the job,” the insider said.

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Buffett's Warren

Warren Buffett’s company Berkshire Hathaway sells US airline shares – BBC News

A screenshot of Warren Buffett speaking at the shareholders' meeting

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Image caption

Warren Buffett made the announcement at the firm’s virtual annual shareholders’ meeting

Billionaire investor Warren Buffett says his company Berkshire Hathaway has sold all of its shares in the four largest US airlines.

Speaking at the annual shareholders’ meeting, Mr Buffett said “the world has changed” because of the coronavirus.

He then said he had been wrong to invest in the airline industry.

Mr Buffett’s comments came just hours after Berkshire Hathaway announced a record $50bn (£40bn) net first quarter loss, Reuters news agency reports.

The conglomerate had an 11% stake in Delta Air Lines, 10% of American Airlines, 10% of Southwest Airlines, and 9% of United Airlines, according to its annual report and company filings.

The firm began investing in the four airlines in 2016, after avoiding the aviation industry for years.

What did Warren Buffett say?

Mr Buffett told the meeting, which was held virtually: “We made that decision in terms of the airline business. We took money out of the business basically even at a substantial loss.

“We will not fund a company that… where we think that it is going to chew up money in the future.”

Image copyright
Getty Images

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The US travel industry has almost collapsed because of the coronavirus pandemic

The US travel industry has almost collapsed as a result of the coronavirus pandemic, with airlines cutting hundreds of thousands of flights and taking thousands of planes out of service.

Mr Buffett said he had been considering investing in additional airlines before the pandemic hit.

“It is a blow to have, essentially, your demand dry up,” he said. “It is basically that we shut off air travel in this country.”

In a statement, Delta said it was aware of the sale and has “tremendous respect for Mr Buffett and the Berkshire team”.

The airline added that it remains “confident” in its strengths.

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