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Warren Buffett's Berkshire Hathaway sold more than $6 billion in stock in April, its first-quarter earnings show

Warren Buffett
  • Warren Buffett's Berkshire Hathaway netted more than $6 billion from stock sales in April, its first-quarter earnings showed.
  • The billionaire investor's company was widely expected to deploy a chunk of its $128 billion cash pile last quarter, but instead its reserves grew to $137 billion by the end of March.
  • Berkshire's first-quarter figures missed Wall Street forecasts due to about $55 billion in investment losses.
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Warren Buffett's Berkshire Hathaway sold more than $6 billion worth of stocks in April, according to first-quarter earnings released on Saturday ahead of its annual meeting.
The famed investor's conglomerate holds stakes in Apple, Amazon, Coca-Cola, and other companies. It was widely expected to capitalize on the coronavirus sell-off and buy stocks on the cheap, but instead netted about $6.1 billion from stock sales last month.
Berkshire's cash pile swelled from $128 billion on December 31 to $137 billion at the end of March, despite it spending $1.7 billion on share buybacks in the period.
The group's first-quarter figures fell short of the consensus estimates of Wall Street analysts polled by Bloomberg.
Here are the key numbers:
  • Revenue: $61.3 billion versus the $63.0 billion estimate
  • Net income: $49.7 billion loss versus the $6.33 billion estimate
  • EPS $20.44 loss versus the $2.58 estimate
  • Net asset value: $372 billion versus the $359 billion estimate
Berkshire posted a net loss of $49.7 billion last quarter, a sharp swing from its net earnings of $21.6 billion in the first quarter of 2019. The shift reflected $54.5 billion in investment losses, compared to a $15.5 billion gain in the same period last year.
However, Berkshire warned investors against reading too much into its earnings.
"The amount of investment gains/losses in any given quarter is usually meaningless and delivers figures for net earnings per share that can be extremely misleading to investors who have little or no knowledge of accounting rules," the company said in its earnings release.
Berkshire's operating earnings grew 6% to $5.9 billion as insurance investment and "other" earnings rose, offsetting lower insurance underwriting profits due to pandemic payouts and less income from its railroad, utilities and energy segment.
The conglomerate had $113 billion invested in equity securities at the end of March, a slight increase from $110 billion at the end of December. It raked in $965 million in after-tax gains from sales of investments last quarter, a sharp increase from $392 million in the comparable period.
Like many other companies, Berkshire warned that the coronavirus outbreak could hurt its operations.
"The government and private sector responses to contain its spread began to significantly affect our
operating businesses in March and will likely adversely affect nearly all of our operations in the second quarter, although such effects may vary significantly," Berkshire said.
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* This article was originally published here Press Release Distribution
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