Berkshire Hathaway’s profits drop 64% due to decrease in portfolio value and sale of Apple stocks by Buffett

Welcome to Extreme Investor Network, where we break down complex financial news and provide you with valuable insights to help you make informed investment decisions. Today, we’re discussing Berkshire Hathaway’s first quarter profits and what it means for investors.

Berkshire Hathaway, the conglomerate led by legendary investor Warren Buffett, reported a $12.7 billion profit in the first quarter, a significant decrease from last year’s $35.5 billion. However, it’s important to note that the drop in profits was largely due to a decline in the paper value of Berkshire’s investments, rather than the performance of the businesses it owns outright.

Operating earnings, which exclude the impact of investment figures, actually saw a strong increase of 39% to $11.222 billion. This demonstrates the resilience of Berkshire’s core businesses, with its insurance companies performing particularly well.

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One notable move by Buffett during the quarter was his decision to trim Berkshire’s massive stake in Apple, selling off more than 100 million shares. Despite the reduction, Apple still remains the largest holding in Berkshire’s portfolio at $135.4 billion. Buffett’s investment in Apple was driven by his belief in the company’s strong consumer loyalty, which he compares to brands like Berkshire’s own See’s Candy.

Other key highlights from Berkshire’s first quarter report include a $2.6 billion underwriting profit from its insurers, a solid performance from its utility unit with a 72% jump in operating profits, and a record cash pile of $188.993 billion. Despite the significant cash reserves, Buffett remains cautious about making large acquisitions unless they present significant potential for profit with minimal risk.

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Overall, Berkshire Hathaway’s first quarter results showcase the company’s ability to weather market volatility and generate strong returns from its diverse portfolio of businesses. For investors looking to follow Buffett’s investment strategies, keeping an eye on Berkshire’s operating earnings and key holdings like Apple can provide valuable insights into the company’s performance and future prospects.

Stay tuned to Extreme Investor Network for more in-depth analysis and expert insights on the latest financial news and trends. Happy investing!

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