Berkshire Hathaway’s shares have made a notable recovery this week, aligning closely with the S&P 500’s year-to-date performance, following a period of underperformance that saw it lagging by nearly 8 percentage points just last week. This rebound bodes positively for the conglomerate, especially in light of developments surrounding DaVita, a company in which Berkshire holds a substantial interest.
DaVita’s stock surged after the release of strong earnings, which is particularly favorable for Berkshire as it maintains a 44% stake representing over 30 million shares, currently valued at approximately $4.2 billion. However, the company faced a setback after being obligated to sell nearly 1.7 million shares of DaVita at a pre-surge price of $120.56 each last Thursday, ultimately accumulating almost $200 million from the sale. This sale comes in the context of a 2024 agreement in which Berkshire vowed to keep its stake in DaVita at or below 45%. The company’s stock buybacks have reduced this percentage, adding further complexity to the situation.
Meanwhile, the Borsheims jewelry store, a subsidiary of Berkshire Hathaway, is preparing for a “major architectural transformation” aimed at redefining customer experiences. President and CEO Karen Goracke highlighted that the goal is to create an “elevated luxury environment” that positions Borsheims as a premier destination. The renovations are set to begin after this May’s annual meeting, with the store remaining operational during construction. The redesign will be executed by HDR for the design phase and Kiewit for construction, both of which are based in Omaha.
In further commentary on investment philosophies, Warren Buffett reiterated the importance of focusing on what makes sense in investment decisions, particularly amidst the noise of IPOs and market fluctuations. He stressed that potential investors should perceive stock purchases as acquiring businesses, advising a long-term perspective that allows for ignoring daily price changes.
As per Berkshire’s latest financial metrics, the stock prices are reported as BRK.A at $762,569.63 and BRK.B at $508.09. The company’s market capitalization stands at roughly $1.1 trillion, with cash holdings amounting to $381.7 billion as of September 30, reflecting a significant increase from the previous quarter. Notably, there have been no stock repurchases since May 2024, indicating a strategic allowance of capital for other investments or operations.
An overview of Berkshire’s equity holdings reveals their top investments in U.S. and Japanese companies, as shared in the latest regulatory filing. These figures drive home the conglomerate’s extensive portfolio and overall market footprint.
For those interested in further insights, comments and inquiries regarding the newsletter are welcome, providing an avenue for engagement while directing readers to additional resources, including Buffett’s annual letters, considered essential reading for stakeholders looking to deepen their understanding of Berkshire Hathaway’s strategies and philosophies.
