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Warren had a tough year — how might explain it?

johnNjohnN
in Fund Discussions
https://www.yahoo.com/finance/m/59ccfc55-7b15-31eb-8c79-a21d60181513/warren-buffett-had-a-tough.html

Warren had a tough year
CHAPEL HILL, N.C. — Last year may have been one of Warren Buffett’s worst years ever.

We won’t know for sure until Berkshire Hathaway BRK.A, +0.26% BRK.B, +0.20%, of which Buffett is chairman and CEO, releases its earnings Feb. 22, at which point we will learn how much the company’s net asset value grew last year. The company’s stock gained only 10.9% in 2019, 20.6 percentage points lower than the S&P 500’s SPX, +0.51% total return. Reached by me Feb. 10, Berkshire wouldn’t comment or confirm when the shareholder letter would be released.

Comments

  • LewisBraham
    He has a mountain of cash in a bull market and his age probably concerns some investors.
  • MarkMark
    I agree with you Lewis and I truly wonder what will be the impact when he and Charlie decide to step aside. Although they talk up their successors quite a bit it remains to be seen if the shareholders buy into it.
  • Sven
    I understand that Ajit Jain and Greg Abel have been managing part of the portfolio in BRK for last several year. Most likely one of them will assume Buffett's position.
    https://observer.com/2019/02/warren-buffett-berkshire-hathaway-succession-plan-shareholder-letter/

    Agree with @LewisBraham that Buffett has too much cash and few buying opportunities. I believe either Jain or Abel helped Warren to buy Apple and sell IBM. Value investing has been trailing large tech stocks for some time.
  • hank
    I was afraid this one was about politics. LOL
  • FD1000
    BEKA is trailing the SP500(VFIAX) for 1-3-5-10 years. See (chart)
    SP500 has higher performance but also better SD, Sharpe and Sortino. See PortVis (link).
  • Jim0445
    I wish investors were given an option to have their dividends reinvested on a tax-deferred basis into new shares instead of taking taxable dividends payments. Oh, I forgot, that would be a "gift for the millionaires and billionaires." It would also take away the one benefit of investing in Berkshire Hathaway instead of the S&P500 or TSM Index.
  • sma3
    This is a pretty good recurring once a decade article "why can't Warren beat the SP500" article, similar to 2000. I do think he could do several things better ( like buy back more shares if he can't find an "elephant")

    On the other hand, having owned BRK.B since 1999, I do think Warren has done a lot of things well. Of most importance he has brought in new and younger mangers to do things ( buy Apple) he seemed unable to consider.

    I have never understood why if he cannot find large companies to buy in toto, he doesn't put more money into other stocks, especially good companies that trip up.

    The stock will probably pop when he dies in anticipation of a dividend or larger buybacks.

    Most of his dramatic market beating achievements were after the 1974 bear market when he established his KO AMP and other large positions.

    He can rebound quickly after dramatic declines as he has the money and the stomach to jump in.

    As a long term investment, with a diverse revenue stream, it is a not a bad place to be, but I would not bet the farm. On the other hand, it is not likely to drop 30% overnight on an earnings miss.
  • Gary
    Feb 14, 2020 , Reuters Feb 14 (Reuters) - Berkshire Hathaway:
    * BERKSHIRE HATHAWAY TAKES SHARE STAKE OF 18.9 MILLION SHARES IN KROGER- SEC FILING
    * BERKSHIRE HATHAWAY UPS SHARE STAKE IN GENERAL MOTORS CO BY 3.8% TO 75.0 MILLION SHARES - SEC FILING
    * BERKSHIRE HATHAWAY UPS SHARE STAKE IN RH BY 41.4% TO 1.7 MILLION SHARES
    * BERKSHIRE HATHAWAY UPS SHARE STAKE IN OCCIDENTAL PETROLEUM CORP BY 153.5% TO 18.9 MILLION SHARES
    * BERKSHIRE HATHAWAY INC - CHANGE IN HOLDINGS ARE AS OF DECEMBER 31, 2019
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