Buffett/Berkshire - general news

[wabuffo]

BRK Q1 2022 10-Q is out:

https://www.berkshirehathaway.com/qtrly/links1stqtr22.html

 

BRK buybacks:

 

Bill

[gfp]

Berkshire went huge on Chevron!  They had like $26 Billion in Chevron at quarter end!

[ValueMaven]

wow - what a strong quarter!!  MSR is finally turning around/improving.  You know if Abel is taking a more active approach to improving operations there?!

[jbwent63]

GEICO underwriting result very disappointing. Otherwise a good quarter.

[gfp]

Just now, jbwent63 said:

GEICO underwriting result very disappointing. Otherwise a good quarter.

 

Yeah, GEICO even had a ton of cost-cutting with expense ratios way down.  But this huge boom in the value of used cars and inflation in the cost of car parts is killing them.  PGR is also raising prices, but looks like GEICO is choosing to be slower with price increases.  Also injury claims values are trending higher than general inflation.  Luckily, GEICO can change prices on a 6 month rolling basis, so can adjust over the course of a year if they choose to.

 

More interesting to me is the difference between so many other insurers celebrating "hard market" and writing huge growth in premium volume and profitability, where Berkshire seems to be taking the opposite approach.  Very slow growth outside of BH Specialty/primary - and low underwriting profitability.  Could be more conservative assumptions since maybe Berkshire is being more real about inflation than other insurers.  

[jbwent63]

Hopefully we get some comments or questions about this specifically. Would be interesting to hear Ajit's take on your comment above relating to hard market/premium growth.

[gfp]

For the bond portfolio, it looks like - similar to Fairfax, they increased their holdings of US treasury/agencies by $5.5 Billion at cost.  There was very little change in corporate bonds or foreign government bonds.  I would assume a similar move to Fairfax of Berkshire starting to purchase some 1-2 yr US gov bonds.

[John Hjorth]

Ref. gfp's posts above, it appears as Mr. Buffett has been extremely busy with capital allocation during the quarter.

 

What about the position in Coca-Cola? - Please see p. 8 in the 10-Q. It appears as one of the big positions at year end 2021, but is omitted at end of 2022Q1 in the specification.

[ValueMaven]

@John Hjorthit's there in the Q .. just search for it ... BTW great to see you posting again!  I've always found your insights helpful & interesting!  Cheers - VM

Edited April 30, 2022 by ValueMaven

[gfp]

Hey John, I believe that Chevron just bumped Coca-Cola from the top 4 companies by holding market value at the end of the quarter.

 

(400 million KO shares was "only" worth around $24.8 Billion at quarter end)

Edited April 30, 2022 by gfp

[Parsad]

Am I the only one that thinks Munger, who always looked older for his age, has recently aged better than Buffett? 

 

At 98, Munger mentally seems extremely sharp, whereas Buffett seems to have slowed down a bit at 91.  Warren still looks good for 91, but he seems to be laboring a bit during the meeting now. 

 

We're so lucky to have received their wisdom for so long, hopefully they have much more time left.  Cheers!

[gfp]

Charlie looks great.  Warren usually starts slow like this (lately) and gets more energized when the questions start rolling in.  He isn't cut out for powerpoint presentations

[gfp]

Berkshire bought more Apple stock in Q1 

 

Looks like they bought approximately 3.6 million additional shares.  Hopefully bottom ticked it in March

 

Berkshire now owns 5.63% of Apple using their most recent 4/15 share count.

Edited April 30, 2022 by gfp

[aws]

I just did the math on Apple. The value on previously known shares would have been 158.47 billion, whereas the 10-Q shows 159.1 billion. So it was probably about a $600 million purchase.

[patience_and_focus]

3 hours ago, gfp said:

 

Yeah, GEICO even had a ton of cost-cutting with expense ratios way down.  But this huge boom in the value of used cars and inflation in the cost of car parts is killing them.  PGR is also raising prices, but looks like GEICO is choosing to be slower with price increases.  Also injury claims values are trending higher than general inflation.  Luckily, GEICO can change prices on a 6 month rolling basis, so can adjust over the course of a year if they choose to.

 

More interesting to me is the difference between so many other insurers celebrating "hard market" and writing huge growth in premium volume and profitability, where Berkshire seems to be taking the opposite approach.  Very slow growth outside of BH Specialty/primary - and low underwriting profitability.  Could be more conservative assumptions since maybe Berkshire is being more real about inflation than other insurers.  

 

Anecdotal. I have Geico insurance for my cars and also have home insurance through their partners. Have been with them over a decade and half.

 

I got my 6 monthly car insurance renewal bill last week and my cost of insuring my 2 cars went down by 15%! Not sure what is going on here but I am a happy customer as we don't drive much (work from home) and they are giving the best deal I can get out there.

 

Disclosure: I am a BRK stockholder.

[aws]

I decided to get a new quote from Geico during the break. I'm surprised that my rate dropped by over 50% since the last time I had a quote with them. That's a pretty huge change and now they are much cheaper than Progressive. Maybe I'll switch back to the family.

[adesigar]

2 hours ago, Parsad said:

Am I the only one that thinks Munger, who always looked older for his age, has recently aged better than Buffett? 

 

At 98, Munger mentally seems extremely sharp, whereas Buffett seems to have slowed down a bit at 91.  Warren still looks good for 91, but he seems to be laboring a bit during the meeting now. 

 

We're so lucky to have received their wisdom for so long, hopefully they have much more time left.  Cheers!

During the Q&A Warren Buffett seemed to be rambling.

Edited April 30, 2022 by adesigar

[AzCactus]

I know Buffett is pretty old but as I'm watching this it sounds like he keeps smacking his lips like he has dry mouth or something.  Anyone else noticing this?

[Mephistopheles]

What happened to Greg and Ajit? Did I miss something?

[sleepydragon]

5 minutes ago, AzCactus said:

I know Buffett is pretty old but as I'm watching this it sounds like he keeps smacking his lips like he has dry mouth or something.  Anyone else noticing this?

My dad has fake teeth. It’s likely because of that.

[fareastwarriors]

4 minutes ago, Mephistopheles said:

What happened to Greg and Ajit? Did I miss something?

 

They are only in the morning session.

 

 

In the morning session, Vice Chairmen Charlie Munger, Ajit Jain and Greg Abel will be available to answer questions from both the audience and Becky. Ajit handles insurance operations and Greg is in charge of all other operations. If questions are asked that are relevant to either of these areas, Becky or the on-premise questioner will get an answer from Ajit or Greg. Neither of them, however, will be available for questions at the afternoon session. 

 

https://www.berkshirehathaway.com/meet01/visguide2022.pdf

Edited April 30, 2022 by fareastwarriors

[gfp]

Buffett announcing that he is participating now in the ATVI arb spread with a 9.5% position 

[aws]

That's a pretty nice potential return if he bought the shares in the mid 70s. ~75 million shares at about $20 per share spread.

[ValueMaven]

'Take me to an art museum and I just wanna know where the mens room is..' lol 

[Xerxes]

Buffett was hilarious today. Good laughs.  
 

Funny, how he described how Oxy and Alleghany came about. Investment by coincidences and chance. So his mental bandwidth and attention is really the deciding factor between cash pile going down or not. 

Edited April 30, 2022 by Xerxes