Entering text into the input field will update the search result below

2020 Berkshire Hathaway Annual Meeting: 3 Key Takeaways

May 04, 2020 12:12 PM ETBerkshire Hathaway Inc. (BRK.A), BRK.B106 Comments
Get Rich Brothers profile picture
Get Rich Brothers


  • The Berkshire Hathaway annual meeting took place today in Omaha. It was live streamed beginning at 4:45 PM Eastern.
  • Warren Buffett and Greg Abel took the stage, with Charlie Munger and Ajit Jain not present.
  • I present three key themes that came out of the four and a half hour discourse.

The Berkshire Hathaway (NYSE:BRK.A) (NYSE:BRK.B) annual meeting took place today in Omaha. It was live-streamed, as it has been in recent years, but this time without the on-site fanfare that usually accompanies it. Typically billed as the Woodstock of Capitalism, the event this year seems to have had only ten to fifteen present in the flesh — this in comparison to the event I attended last year which was estimated to have had ~42,000 in Omaha for the festivities.

One of the key differences this year was that Warren Buffett was on stage with Greg Abel, not his partner-of-sixty-years, Charlie Munger. The hope for all shareholders — I hope I can speak for all of us — was that we would for the first time get to see Buffett, Munger, Abel, and insurance-manager Ajit Jain on stage at the same time this year for the Q&A. Instead, we got half of the equation (and perhaps not the half we might have expected). Succession planning on the whole has been one of the hottest topics at Berkshire Hathaway, as I noted when I covered Buffett’s 2019 Letter to Shareholders back in February.

The event began around 4:45 PM Eastern and ran to 9:15 PM, covering plenty of ground over the four and a half hour span. Amid the copious notes that I took and will continue to chew on over the next few days, I will share the three key points that stood out to me.

Key Takeaway No. 1

As he has in years past, Buffett opened the event with general remarks pertaining to the economy and, in this case, a full blown history lesson from America’s birth to the present day. He noted that the combined lifespans of he, Munger, and Abel exceed the total span of time that the U.S. has existed — its 231 years amount

This article was written by

Get Rich Brothers profile picture
I’m a mid-thirties Canadian presently employed at my day job with a healthcare facility working in Clinical Informatics—software and programming, specifically. I’ve been investing in individual equities since 2009 when I made my first purchase in Toronto-Dominion Bank (TD). I still hold those shares and have continued on my path of being a net accumulator of assets under the dividend growth investing model. I believe cash flow is king and focus my investment efforts on building an ever-growing source of passive income which will someday fuel my financial freedom. My life philosophy is simple: Leave all things a little better than how you found them.

Analyst’s Disclosure: I am/we are long BRK.B. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (106)

The reason berkshire is down is because the market expected he would buy, and he said no, he is not presently a buyer and needs to hold cash
Completely ridiculous he wasn't buying back Berkshire stock hand over fist. I believe part of the stock's underperformance is tied to the lack of capital deployment. No dividend. No buybacks. no acquisitions.
This was a very good review. I watched the majority of the broadcast but cut short the questions hosted by Becky Quick. Warren referred to Berkshire's stockholders as family members and he manages his investment portfolio accordingly. I agree with his perception and only wish I had become a member before being "adopted" in 2010. It's been a great ride! I have enjoyed being an investor with Warren, Charlie and staff leading the way. Intelligence, savvy and integrity, with a bit of humor along the way, have carried this family well.
Geloo profile picture
The market goes up, the market goes down. I just keep buying good quality companies as new money comes in. Do I regret at times I didn’t sell at the top? Sometimes, but I keep buying anyway.
Buffett selling airlines says it all, the rebound not going to happen fast in his opinion.
No buys - nothing worth buying, valuations still too high, well we are currently at 2019 levels, just reset one year.
Nettligent profile picture
@imeldo marcos investment is very simple and common sense. There are many speculations from Analysts, high risk with uncertainties, and overvalued stocks in the depressed market.
For the first time in history, Berkshire has to unload and clean up their portfolio with decent profits, raise cash as much as possible.
blacky_ profile picture
Thanks for the great summary!
Get Rich Brothers profile picture
Quite welcome, @blacky_ .
I was disappointed, and concerned, to learn that BRK found NO bargains worth putting money into during the market drop in March. That tells me, and Warren as much as said it, that they are awaiting the "real" drop. I hope one does not come. (Warren of course said he has no idea what WILL happen, as do none of the rest of us.)
35nakedshorts profile picture
Well they found no bargains worth deploying billions of dollars into. Plenty of bargains to be had in small caps.
But they deployed virtually nothing in new investments, large or small in March or April. I am not referencing the article above. I watched the Shareholder meeting on Saturday. Your are right, Warren clearly said they found nothing to make any large purchase.
It certainly looked to me that there were any number of Co. at or near a fair price for a couple of days. It seems to me that SOME buying would have been appropriate.
I found Buffett negative at this meeting. Looks like Greg Abel will be the next CEO, when Buffett steps down, time will tell.
I found him very negative also, about the near term outlook. I was very concerned what would happen today when the market opened. I hope we have seen the lows, both of the market, and of how closed businesses are.
For the losses he took on the airlines and ibm and
Kraft Heinz who could have given us Shareholders a magnificent special dividend
He made a small amount on IBM with dividends, he is about even on KHC and he would be ahead well with dividends. He lost a few billion on airlines but he did collect quite a bit of dividends before he took the losses. Put it all together and my guess is that it all comes out pretty close to break even. Even if he lost a billion or two in total it wouldn't be enough for any kind of a worthwhile special dividend to shareholders. $5 billion (he didn't lose that much on the above) would come out to just over 1% or something like $2/class be share and he didn't lose $5 billion on the three combined investments. His losses on the first two were opportunity costs, the airlines were real losses but his total investment was only $7 or $8 billion which is nothing compared to the scale of Berkshire.
You are a part owner of BRK and mistakes were made so your conclusion is to take money out of the business?
Has Buffett commented on social media companies (Facebook, Twitter, etc)? Has Buffett commented on Uber/Lyft?
powerful-crow-juju profile picture
I am EXTREMELY curious about his point of view on social media.

He has liked newspapers, which are ad-based eyeball catchers.

His concern is almost certainly that he doesn't trust a network-based technology company's moat.

That said, Facebook's moat seems palpable.
As a BRK shareholder, I think BRK goes in and out of positions more than the Buy and Hold public persona. I think that it is great he got out of the airlines without citing some black swan event. He just called it as his mistake. Whether BRK mirrors the S&P give or take a percentage point or two may depend on how value investing does in the coming decade. BRK is not set up to ride the momentum. Maybe BRK will start paying a dividend if their cash pile is unused by the end of the crisis?
It is not his mistake actually, no one predicted this.
He has always said that forever is his favorite holding period, but more often than not he doesn't end up holding positions forever. We've seen him do that with positions like Coke, Amex etc. I'm sure when he makes an investment he hopes the company does well and he can hold it forever but more often than not it doesn't work out. So far he has continued to hold Apple and Bank of America for quite some time. I think he said he made a mistake with the airlines because even though nobody saw this black swan event he should have know they are not a business you can hold forever, they're too susceptible to economic shocks an that is bad news in a very capital intensive business.
Get Rich Brothers profile picture

Buffett took accountability for the airlines as a mistake, but I believe the real mistake was simply owning them in the first place. It's not realistic to blame Buffett for not foreseeing the pandemic, but buying into a business that is so cyclical and subject to shocks runs against the grain of his investing style.
with all due respect to Warren Buffett - I would have liked him to have skipped the long winded history lesson and the never bet against America chat (never mind the trillions in debt America has accumulated in the last 20 years) and gone into more granular detail about the operations and strategy during this crisis
old fashion fatigue and ready for retirement and he should relax and enjoy his grandchildren more and sit back and watch and enjoy. He has done his job for Amerika. Blessings.
@Telephone2 He let go of Lehman Bros and he dropped airlines all together. I wonder what it was. Probably the airline industry's NEEDY ATTITUDE e.g., government bail out. Apparently, with Lehman Bros. the company did not disclose things properly on time as promised. Even it's bad news, it seems like he's the type that would RATHER LISTEN TO BAD NEWS and KNOW bad news rather than NOT know them. While there are companies that are returning loans, Airlines would rather receive Money from the Government and SIT ON THEM FOR A LOOOOOOONG TIME.
Meanwhile, there are many publicly traded companies that are returning loans to help the small businesses.
He noted that he put 99% of my personal money into BRK. But what does that mean to Mr. Munger? I'm very surprised that Mr. Munger/Ajit Jain did not join the call. I always thought that they had an extra-ordinary or extra-wide relationship. Do they feel the same way about the market?
KeithRichards profile picture
Charlie is a conservative, Warren is a liberal. Each group is handling the crisis differently. Conservatives bought the bottom while liberals are still waiting on the sidelines for Bill Gates "all clear".
Get Rich Brothers profile picture

Very disappointing for me as well that Munger and Jain didn't simply jump on the call remotely. Doesn't quite make sense to me that they didn't, truly.
@Get Rich Brothers Yes particularly because Mr. Munger is -4 from reaching the age of 100. How many more quarters do you think they can cover together?
Kyle Fishman profile picture
Buffett's airline blunder diminished his credibility.

For years he's been saying airlines "have all the ingredients of a bad business"
--- then in 2013, the industry consolidates ---- Buffett again says 'no, I'm still not a fan of the airlines. maybe if it gets down to two major airlines I'll think about it, but not four.'
--- then in 2016, there's still four major airlines, and Buffett surprisingly buys them!!!
---- then in 2020, they crash,
and then Buffett sells them (at a loss).

yeah, there's no way to positively spin this. It's a blunder. It's a careless blunder.
"Be greedy when they're fearful" 🤔
Todd or Ted bought them and Buffett took the responsibility.
Kyle Fishman profile picture
“That was my mistake,” Buffett said.
And do you really think he’s familiar with YouTube that was a good one. Ask him if he SnapChats the grandkids haha.
fhbecker profile picture
Think he also expressed some concern at the precedent the FED's intervention was setting, while acknowledging the intervention was successful.
Get Rich Brothers profile picture
Yeah, he gave plenty of credit to the Fed for successfully handling the situation, whilst acknowledging that this actually hurt BRK's prospects to take advantage of bargains and distressed situations.
stock realist profile picture
Buffet didn't look well at all at least in the clip where he was talking about the airlines. Maybe it's just the remote format that had him off his game but he was flustered at times and a couple of times seemed to lose the thought he was trying to express.

He also didn't look well, at least to me. He really lacked his usual energy and crisp delivery.
He spoke for nearly 4 hours without a script, except during the formal meeting portion. He searched for words, but was as on his game as I have seen. I watched it live the whole time. He was good.
Get Rich Brothers profile picture
I found he started relatively slowly, but found his groove as he got going. I think it was just such a strange format that it took him a few minutes to get going. I found him quite sharp for the most part.
If $137 billion is perhaps not enough reserves where does that leave the rest of us?
Get Rich Brothers profile picture

It's all relative. Most of us aren't living with the portfolio size and potential liabilities from an insurance perspective that Buffett/BRK is.
A lot of people missed a key comment in his speech regarding companies needing cash in this economy. There is a very real possibility that even BRK's huge pile of cash may not be enough to deal with the worst possible outcomes of this crisis.
Get Rich Brothers profile picture
Yeah, I think he made it clear that it isn't just complacency that he remains sitting on that huge cash pile. The reality is that it may well be needed at some point along the way, whether on the defensive side or to be opportunistic.
Ice_Kold profile picture
I have a feeling Berkshire is waiting for Boeing to be seriously underwater, then they'll bail them out. He'll get a good product, good employees (minus management), and he'll go out in a blaze of glory having rescued a crucial American company. He'll be remembered as a savvy investor and as a savior.
When he has dumped airlines (the market facing side of Aircrafts) why would he go anywhere near Boing, which will see demand after Airlines are up and running?
Good Walk profile picture
No chance. He hates airlines. No way Berkshire plays white knight to Boeing. Or anyone else.
No he wont touch the airlines and planemakers.
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!

About BRK.A

SymbolLast Price% Chg
Market Cap
Yield (TTM)
Rev Growth (YoY)
Short Interest
Prev. Close
Compare to Peers

More on BRK.A

Related Stocks

SymbolLast Price% Chg
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.