OMAHA, Neb. (AP) — Warren Buffett credited his longtime partner — the late Charlie Munger — with being the architect of the Berkshire Hathaway conglomerate he’s received the credit for leading and warned shareholders in his annual letter to not take heed to Wall Street pundits or financial advisors who urge them to trade often.
Buffett also recounted how Berkshire’s insurance businesses thrived last 12 months, but its massive utilities and BNSF railroad disenchanted. He also told shareholders how he never plans to sell its stakes in nearly 30% of Occidental Petroleum and 9% of 5 large Japanese trading houses, but he reiterated that he has no plans to buy the oil producer outright.
Berkshire’s eclectic mixture of firms, combined with the strong performance of its investments, delivered a profit of $37.57 billion, or $26,043 per Class A share, throughout the fourth quarter. That is bigger than double the $18.08 billion profit, or $12,355 per Class A share, that Berkshire reported a 12 months earlier.
But Buffett cautioned that investors should largely ignore those bottom line figures because they’re swayed quite a bit by the paper value of its investments. Instead, he has long urged investors to pay attention to Berkshire’s operating earnings that exclude investments.
By that measure, Berkshire reported a 28% jump in operating earnings to $8.48 billion, or $5,878.21 per Class A share. That’s up from $6.63 billion, or $4,527.06 per Class A share.
The three analysts surveyed by FactSet Research predicted that Berkshire would report quarterly operating earnings of $5,717,17 per Class A share.
Berkshire’s stock has set a series of recent records in recent weeks, most recently peaking at $632,820 per Class A share Friday morning as investors eagerly anticipated Buffett’s letter. Buffett is revered for his remarkably successful track record and the sage advice he has offered over the various years. His annual letter is on a regular basis considered certainly one of the best-read reports throughout the business world.
Berkshire also spent $2.2 billion repurchasing its own shares throughout the fourth quarter, bringing the whole to $9.2 billion for the whole 12 months.
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