Berkshire Hathaway Inc(BRK.A)- NYSE
  • Wed, Sep. 21, 3:50 PM
    • Reached by Fox Business for his thoughts on the Wells Fargo (NYSE:WFC) scandal, the bank's largest shareholder says he's going to stay mum until November. For good measure, he says he's also going to stay silent on the presidential election.
      "If I start commenting on that or anything else, it will lead down too many paths so I will wait until November to speak about it, the election or any other subject."
    • The owner of nearly 10% of Wells Fargo, Berkshire Hathaway (BRK.A, BRK.B) this summer applied to the Fed for permission to raise its holdings above that threshold, so it's possible rules related to that process prevent Buffett from speaking out.
    • Looking back at The Oracle's reaction to an ethical lapse at Salomon Brothers 25 years ago could give a hint. Buffett took over as CEO, and in Congressional testimony said, "Lose money for my firm and I will be understanding; lose a shred of reputation for the firm, and I will be ruthless."
    • With stocks and the big banks solidly in the green, Wells is underperforming again, down 1.6% on the session.
    | Wed, Sep. 21, 3:50 PM | 87 Comments
  • Tue, Sep. 20, 3:21 PM
    • Yet to be heard from since the account opening scandal hit Wells Fargo (WFC +2.1%) is its largest shareholder, and Dick Bove suggests The Oracle may be rethinking his investment.
    • It's no coincidence, says Bove, that on the day of Stumpf's Capital Hill grilling, it was announced that key Buffett lieutenant Todd Combs was joining the board of JPMorgan - a bank in which Berkshire (BRK.A, BRK.B) has no stake. "[Buffett] is clearly walking away from Wells Fargo," says Bove.
    • How exactly Buffett is going to just "walk away" from a 9.5% stake in the bank is another story, of course. There's also Buffett's long history - the man seems far more likely to be a buyer, rather than seller, in these sorts of situations (see the American Express salad oil scandal).
    • Bove cuts his price target to $40 from $44.
    | Tue, Sep. 20, 3:21 PM | 131 Comments
  • Tue, Sep. 20, 7:21 AM
    • Berkshire Hathaway (BRK.A, BRK.B) investment officer Todd Combs - rumored to be part of the Buffett succession plan - has been elected to the Board of Directors at JPMorgan (NYSE:JPM), effective September 19.
    • Prior to joining Berkshire in 2010, Combs was the founder and CEO of Castle Point Capital. Warren Buffett has called his hiring "one of my best moves."
    | Tue, Sep. 20, 7:21 AM | 9 Comments
  • Fri, Sep. 16, 3:57 PM
    • Charlie Gasparino is reporting those close to Wells Fargo (NYSE:WFC) John Stumpf as saying his job is in jeopardy over the account opening scandal.
    • With pressure mounting and two congressional appearances set for the next couple of weeks for Stumpf and team, a vote of confidence from Warren Buffett (BRK.A, BRK.B) might be in order, but The Oracle has been curiously silent for now.
    • A new story from the WSJ's Emily Glazer describes conditions at Wells Fargo branches in which tremendous pressure was put on employees to meet sales targets for the bank which championed itself as king of the cross-sell.
    • Managers suggested workers hunt for prospects at bus stops and retirement homes, and branch bosses are described as constantly monitoring progress towards sales goals, sometimes hourly. Numbers at the branch level were reported to higher-ranking mangers as many as seven times a day.
    • In Tucson, a common tactic was to tell wealthier, existing customers that the bank was going to send them a new credit card as a "thank you" for their business. If the customer didn't want the card, they could cut it up, but in the meantime, credit was pulled, which could ding the customer's credit score.
    • Shares are down another 1.6% today, again underperforming Wells' big bank peers.
    | Fri, Sep. 16, 3:57 PM | 134 Comments
  • Fri, Sep. 16, 2:57 PM
    • A deal between Berkshire Hathaway’s NV Energy (BRK.A, BRK.B) and SolarCity (NASDAQ:SCTY) that will roll back rate hikes for existing rooftop solar customers is approved by the Nevada Public Utilities Commission.
    • The vote was expected after the companies earlier this week asked the PUC to approve an agreement that would grandfather those who signed up to use home solar prior to January under more favorable rates for 20 years.
    • The agreement will protect more than 32K Nevada rooftop solar customers from higher fees that took effect in January.
    | Fri, Sep. 16, 2:57 PM | 18 Comments
  • Tue, Sep. 13, 5:36 PM
    • Berkshire Hathaway's (BRK.A, BRK.B) NV Energy, Solar City (NASDAQ:SCTY) and Nevada regulators reportedly reach an agreement to grandfather eligible customers under older, more favorable rates for customers who installed residential rooftop solar systems before this year.
    • The grandfathering agreement will apply to ~32K customers, including those who had a pending application on Dec. 31, 2015; the rates had been raised in December and retroactively applied to existing customers.
    • The deal still must be approved by the Nevada Public Utilities Commission, which is expected to vote on it on this week.
    | Tue, Sep. 13, 5:36 PM | 12 Comments
  • Mon, Sep. 12, 3:50 PM
    • A lawsuit filed late on Friday by Breakaway Courier Systems - a New York bicycle courier company - accuses Berkshire Hathaway's (BRK.A, BRK.B) Applied Underwriters of "siphoning" premiums through a web of illegal shell companies, with diverted premiums going to unlicensed out-of-state insurers.
    • It amounts to a "reverse Ponzi scheme," says Breakaway, where employers expecting to buy affordable policies instead bought costly reinsurance requiring them to cover each other's losses, and leaving taxpayers on the hook when too many were injured on the job.
    • "Berkshire's schemes break multiple laws, including that you cannot collect insurance premiums if you are not licensed," says Breakaway's attorney Raymond Dowd.
    • The suit comes three days after Applied agreed to stop selling disputed workers' comp policies in California.
    • Source: Reuters' Jonathan Stempel
    | Mon, Sep. 12, 3:50 PM | 9 Comments
  • Wed, Sep. 7, 8:20 AM
    • Things are back to normal for Berkshire Hathaway (BRK.A, BRK.B) in 2016 as its 13.5% advance year-to-date is topping the S&P 500 by nearly 700 basis points.
    • This comes after a rough 2015, in which The Oracle's company slipped 12% versus the S&P's near-flat performance.
    • Helping in 2016 is the strong relative performance of the financial sector over the past few months, not to mention value names in general this year outperforming growth stocks.
    | Wed, Sep. 7, 8:20 AM | 4 Comments
  • Wed, Aug. 31, 4:56 PM
    • The issue, according to analysis by Yale's Yair Listokin, is that the stock rarely seems to ever close above $53.72 - just seven times since April 2014 despite a range from the low-$40s to low-$50s. This compares to more than 50 closes at just below $53.72, and a full 91 closes from $52.71-$53.71.
    • Why is this important? Dow Chemical (NYSE:DOW) has the option to buy back $3B worth of preferred shares from Berkshire Hathaway (BRK.A, BRK.B) only if the stock closes above $53.72 enough times. Some executives at Dow believe a short seller keeps knocking it back, and they've got fuel for that argument from Listokin.
    • “The probability that this would happen by chance is essentially zero ... [it's] pretty clear evidence of manipulation," he says.
    | Wed, Aug. 31, 4:56 PM | 86 Comments
  • Mon, Aug. 29, 8:16 AM
    • A strong pace of EV sales helped lift net profit at BYD Company (OTCPK:BYDDF, OTCPK:BYDDY) by 38% to 2.26B yuan ($340M) for the six-month period ending on June 30.
    • Revenue was up 44% to 43.74B yuan during the period.
    • BYD says "new energy" sales accounted for 35% of the tally. The company expects new energy vehicle sales to double to 120K this year, although a planned scaling down of subsidies from the Chinese government could slow momentum over the next several years if they aren't reversed.
    • Berkshire Hathaway (BRK.A, BRK.B) holds a 9.89% stake in BYD.
    • BYD's shares in Hong Kong closed up 2.45% to HKD$52.25.
    | Mon, Aug. 29, 8:16 AM | 4 Comments
  • Thu, Aug. 25, 3:59 PM
    • Berkshire Hathaway (BRK.A, BRK.B) now controls more than 15% of Phillips 66 (PSX +1.8%) after buying more shares in the oil refiner this week, bringing its total number of PSX shares close to 79.5M as Warren Buffett continues his steady buildup of shares since 2012.
    • Buffett bought 704,181 shares at an average price of $77.45/share between Aug. 22 and Aug. 24, which would be valued at ~$6.17B.
    | Thu, Aug. 25, 3:59 PM | 40 Comments
  • Thu, Aug. 25, 12:40 PM
    • One "overarching issue has emerged over the last 90 days, and that is Gen Re's costs problem," says Ajit Jain in an internal memo seen by Bloomberg.
    • Jain took on oversight of Berkshire Hathaway's (BRK.A, BRK.B) Gen Re earlier this year. "The ratio of expenses to premiums is not where it should or could be," he continues.
    • While Berkshire's reinsurance operation generates billions in profits, and plenty of float for Warren Buffett to invest, the Gen Re experience has been more rocky since being purchased in 1998 for $22B.
    • Underwriting losses began soon after, and float has been falling for more than a decade. This year, premium revenue of $2.78B in H1 was down 7% from 2015's level. Pretax underwriting gain of $132M in 2015 was down more than 50% from the year prior.
    • Among the items noted by Jain is pay, where employees have an incentive to shun some potentially profitable business because compensation is tied to margins, rather than overall earnings. He also takes note of the "gradual creep of corporate bureaucracy," and suggests reducing management layers to three or four from the current six, overhauling the budget process, and cutting travel and entertainment expense. “I happen to think that my distaste for complexity and bureaucracy is appropriate and ordinary, although others have called it rabid and overzealous."
    | Thu, Aug. 25, 12:40 PM | 13 Comments
  • Wed, Aug. 24, 6:56 PM
    • The stock market's recent rise has boosted holdings in Berkshire Hathaway’s (BRK.A, BRK.B) portfolio, but the rally in Dow Chemical (NYSE:DOW) has put that company's $255M in annual dividend payments to BRK at risk, Dow Jones reports.
    • Since BRK lent Dow $3B in 2009 to help finance an acquisition, Dow has been on the hook for paying an 8.5% annual dividend on 3M preferred shares, but the deal has an escape hatch: If Dow's shares exceed $53.72 for at least 20 trading days in a 30-day period, Dow can convert BRK's preferred shares into common shares, which do not pay out special dividends.
    • Dow's failure to stay above the $53.72 for long - despite improved earnings and margins, cost cuts, asset sales, an activist shareholder who shook up the board, and a potential merger with DuPont - has fueled speculation that BRK or Warren Buffett are shorting Dow to pressure the stock and avoid triggering the conversion.
    • Although short interest in Dow is down for the year and dropped to $600M at the end of July, short sellers have increased their positions by nearly $100M in August, according to financial analytics firm S3 Partners.
    | Wed, Aug. 24, 6:56 PM | 40 Comments
  • Tue, Aug. 9, 11:59 AM
    • Operating earnings may have disappointed a few on the Street, but Berkshire Hathaway (BRK.A, BRK.B) still trades for just 1.36x book value, writes Andrew Bary in Barron's.
    • Barclays' Jay Gelb maintains his Overweight rating and $249K per class A share price target (vs. current $220K), as he expects book value will rise to $183K per share by the end of next year while the valuation will remain close to that 1.36x.
    • The bull case for those who have been sleeping for a few decades: With no dividend, after-tax operating earnings of about $11K per share per year, or $18B, accrue to book value and replenish Berkshire's cash balance, enabling The Oracle of Omaha to make more accretive acquisitions - a virtuous cycle which doesn't appear to be reflected in BRK's valuation.
    • There's also downside protection in Buffett's willingness to be a buyer of Berkshire at 1.2x book value.
    • Risks? The obvious one is the possibly impossible shoes to fill of Warren Buffett.
    | Tue, Aug. 9, 11:59 AM | 18 Comments
  • Fri, Aug. 5, 4:24 PM
    • Berkshire Hathaway (NYSE:BRK.B): Q2 Operating EPS of $2,803.00 vs. $2,367.00 in 2Q15
    • Shares -0.61 AH.
    • Press Release
    | Fri, Aug. 5, 4:24 PM | 40 Comments
  • Fri, Aug. 5, 9:36 AM
    • NPD Group reports portable power pack sales were up 101% Y/Y for a two-week period in July following the introduction of Pokémon Go.
    • Whether or not the sales pace sustains is still to be determined, but brands like Duracell (BRK.A, BRK.B), Dynex (owned by (NYSE:BBY)), Insignia (also BBY), Zagg (NASDAQ:ZAGG), Mophie (owned by Zagg) and Energizer (NYSE:ENR) are likely to see a boost to July sales.
    | Fri, Aug. 5, 9:36 AM | 13 Comments