Buffett/Berkshire - general news

[mengan]

6 minutes ago, gfp said:

 

BHE will still have a hugely negative tax rate because they will not lose the production credits on what they already have in service.

 

The bonus depreciation I was referring to started at 100% back in 2017 but was being phased down and was 60% in 2024, would have been 40% this year, etc...  Now it is back to 100% and BRK is a large cash tax payer.

Right, that point is an important distinction I missed. 

[mengan]

It will likely become messy over time over what is considered maintenance capex where this "grandfathered" tax credit is retained and what is considered a "reconstruction" or "upgrade" where the facility must receive a new "placed in service" date, and where the tax credit is lost.

Edited August 5, 2025 by mengan

[gfp]

I would expect a complete halt to those "repowering" projects where they take an existing wind farm and replace the turbines with newer, larger, higher producing models and re-start the production tax credit clock.

 

Berkshire will build what makes economic sense and for the immediate future that is going to be gas fired power plants, delaying shutdown of coal plants and maybe a tiny amount of small nuclear in the distant future.

 

But they did what they could with renewables while the sun was shining and that installed base will serve them well.  Luckily they were aggressive during that period.

 

Nothing wrong with natural gas.  Its great

[wabuffo]

hey, gfp - do you think BHE pushes back some of its natural gas conversions in favor of coal.  Many of its PacifiCorp power plants have coal supply right next door.  And those coal mines have seen the royalty rates they pay for mining coal on Federal lands slashed due to the OBBB just passed.

 

Bill

 

 

Edited August 6, 2025 by wabuffo

[gfp]

9 minutes ago, wabuffo said:

hey, gfp - do you think BHE push back some of its natural gas conversions in favor of coal.  Many of its PacifiCorp power plants have coal supply right next door.  And those coal mines have seen the royalty rates they pay for mining coal on Federal lands slashed due to the OBBB just passed.

 

Bill

 

 

 

It's too soon to tell.  Their most recent comments still show them converting them to gas over time but things have changed since this powerpoint was released.

 

 

....

 

 

 

....

 

 

 

They still expect to be generating 20% using coal 5 years from now.  I assume the decisions that have already been approved by regulators and put into motion will proceed as expected.  Maybe regulators have to take a second look at longer term plans if they are no longer the best move for ratepayers.

Edited August 5, 2025 by gfp

[Munger_Disciple]

6 hours ago, CassiusKing1 said:

I would hope that prior to paying a dividend they exhaust all opportunities to buy back stock.  I'd rather see them loosen the qualifications to buying back stock rather than pay a dividend.

 

Amen!

[jbwent63]

1 hour ago, Munger_Disciple said:

 

Amen!

With Warren's stake in play when Methusulah does catch up to him (I too hope it isn't for years), do we think the market will be the buyer, or will Berkshire have a chance to buy in these shares (i.e. a ROFR)?

[Munger_Disciple]

@charlieruane Some SIRI news FWIW:

 

https://www.the-sun.com/entertainment/14910416/howard-stern-show-canceled-contract-up/

 

Canceling Stern show. Now put the baby in milking mode before the last boomer leaves the platform while the younger subscribers sign up for Spotify or Apple Music. 

Edited August 6, 2025 by Munger_Disciple

[Munger_Disciple]

3 hours ago, jbwent63 said:

With Warren's stake in play when Methusulah does catch up to him (I too hope it isn't for years), do we think the market will be the buyer, or will Berkshire have a chance to buy in these shares (i.e. a ROFR)?

 

There is no Warren premium in the stock now especially since Greg is the CEO for all practical purposes at this point. 

[Hektor]

https://www.barrons.com/articles/berkshire-hathaway-stock-sale-buffett-28571fc9

Berkshire Hathaway Director’s Firm Sold Almost 30% of Its Berkshire Stake

 

The investment firm run by Berkshire Hathaway director Chris Davis sold nearly 30% of its stake in Warren Buffett’s company during the second quarter, taking advantage of the run-up in the share price.

 

Davis Selected Advisers, which runs the Davis New York Venture fund, reduced its stake in Berkshire Hathaway to 1,434 shares class A equivalent (with class B shares converted to an economically equivalent amount of class A stock) on June 30 from more than 2,000 shares on March 31, according to Barron’s analysis of a new regulatory filing that details the fund’s U.S.-listed holdings. 

[gfp]

On 8/5/2025 at 3:21 PM, jbwent63 said:

With Warren's stake in play when Methusulah does catch up to him (I too hope it isn't for years), do we think the market will be the buyer, or will Berkshire have a chance to buy in these shares (i.e. a ROFR)?

 

I don't think there will be a right of first refusal.  The A-shares will be converted to B-shares as they are sold over a 10 year period.  The float adjusted weighting of Berkshire in the S&P500 will rise as Warren's stock is distributed into the "free float."  So some of the shares will end up in index funds, sector funds and index-like funds.

 

If the stock trades at 1.5x book or below, Berkshire will probably buy a significant amount of stock over the 10 year period, maybe more shares than Warren owns.  It depends on the market price obviously.  But Berkshire wouldn't be buying them directly from the Buffett foundations just like it doesn't buy shares directly from the Gates Foundation.

 

Since two of Buffett's children will be on the Board of Directors, I don't think they will "call the hotline" to sell blocks of stock directly to Berkshire as that would open up a can of worms that using the exchange helps avoid.  I could be wrong of course - Berkshire can be unconventional at times!

[Munger_Disciple]

2,000 Class B shares sold by Ajit Jain (shares owned by his foundation):

 

https://www.sec.gov/Archives/edgar/data/1067983/000172845125000006/xslF345X05/primary_doc.xml

[gfp]

2 minutes ago, Munger_Disciple said:

2,000 Class B shares sold by Ajit Jain (shares owned by his foundation):

 

https://www.sec.gov/Archives/edgar/data/1067983/000172845125000006/xslF345X05/primary_doc.xml

 

good for Ajit.  More than half his Berkshire is owned in the foundation.  $80m in family trusts and $90m in the foundation.

[ZindyLou]

I went through the last several filings to see when and where Berkshire uses the word “restructuring”.
Here’s what I found:

 

2023

• Q1 – 0 mentions
• Q2 – 0 mentions
• Q3 – 0 mentions
• Q4 – 2× in Manufacturing, Service & Retailing (MSR) section

 

2024

• Q1 – 1× in MSR
• Q2 – 2× in MSR (Other building products businesses & apparel businesses)
• Q3 – 2× in MSR (Same as Q2)
• Q4 – Duracell – 2× mentions (~$2B annual revenue)

 

2025

• Q1 – Lubrizol(~6.5B annual revenue) & Fruit of the Loom(~5B annual revenue)
• • Lubrizol: Restructuring charges + lower volumes/prices drove a 25.8% earnings drop.
  • Fruit of the Loom: Benefits from restructuring efforts helped offset weakness elsewhere.
• Q2  – Lubrizol(~6.5B annual revenue) & Fruit of the Loom(~5B annual revenue)
• • Lubrizol: Volumes/prices down; Q1 restructuring charges still cited.
  • Consumer products: Revenue decline at Fruit of the Loom (–11.7%) partly linked to business restructurings.

 

Quick Observations

• The term “restructuring” is absent in 2023 until Q4.
• Frequency picked up in 2024, mainly tied to MSR segment businesses.
• In 2025, Lubrizol and Fruit of the Loom are the recurring names.

 

Open Questions

• Is this the kind of operational work Greg Abel can directly influence? Could these restructuring efforts reflect his more hands-on management approach in certain subsidiaries?
• Why were there no similar mentions of restructuring or optimisation in past Berkshire reports?
  • Is it that Buffett didn’t care to highlight it?
  • Or is it now being mentioned to show they are actively cutting inefficiencies?
    Anyone here have a view on this disclosure?

[gfp]

https://professionalwatches.com/warren-buffets-berkshire-hathaway-forms-bh-jewelry-group/

[Munger_Disciple]

Barron's piece on Warren:

https://www.barrons.com/articles/warren-buffett-value-working-past-65-1cf1d87f?siteid=yhoof2

 

Amazing illustration of the power of compound interest and a long, healthy life. 

Edited August 13, 2025 by Munger_Disciple

[whatstheofficerproblem]

Grandpa B bought NUE, DHI, LEN, UNH, LAMR. Added to HEI.A, LEN.B, DPZ & reduced AAPL, DVA, CHTR, BAC.

Edited August 14, 2025 by whatstheofficerproblem

[gfp]

NUE, UNH and a couple homebuilders.  Tiny position in Lamar - so much for 1 confidential stock - these are all T&T buys

 

 

These were the confidential positions.  The media needs to stop assuming confidential positions are one big Buffett sized position -

 

Edited August 14, 2025 by gfp

[ValueMaven]

The add to HEI.A is amazing ... would love for this to be a BRK sub - where they merged HEI and PCP together!!

[whatstheofficerproblem]

7 hours ago, gfp said:

these are all T&T buys

 

Why are T&T looked down upon? I get the distaste for Todd, but Ted?

 

 

[redskin]

On 8/5/2025 at 8:06 AM, CassiusKing1 said:

I think Greg is going to evaluate all wholly owned companies and focus on them.  He'll make add on acquisitions and bolster them.  I don't see him making an elephant sized buy.

I would hope that prior to paying a dividend they exhaust all opportunities to buy back stock.  I'd rather see them loosen the qualifications to buying back stock rather than pay a dividend.

There are no restrictions for Buffett to buy back stock.  He will buy if he feels there aren't better opportunities.  He seems to be content with 4.2% tbills with the option of future investments.
 

[Pellom]

11 hours ago, whatstheofficerproblem said:

 

Why are T&T looked down upon? I get the distaste for Todd, but Ted?

 

 

 

It's really hard to judge them because they have so much cash that the basically have to stick with S&P 500 companies, but the general dislike I have, and others share, is that they trade too much and are too focused on quality. Essentially, they don't have the patience to sit around and do nothing until the market allows for better opportunities.

 

Expecting them to do that is probably unfair, though, considering they are both likely jockeying with each other and the old man. 

[Munger_Disciple]

2 hours ago, Pellom said:

 

It's really hard to judge them because they have so much cash that the basically have to stick with S&P 500 companies, but the general dislike I have, and others share, is that they trade too much and are too focused on quality. Essentially, they don't have the patience to sit around and do nothing until the market allows for better opportunities.

 

Expecting them to do that is probably unfair, though, considering they are both likely jockeying with each other and the old man. 

 

Todd seems to trades too much, but not Ted. Ted seems to specialize in distressed deep value type companies (SIRI, DVA etc.), a.k.a. shitcos. But he also bought (and later sold) AAPL, a high quality compounder, in the past and has been instrumental in educating Warren about its merits which then led to Warren making a massively successful bet on it. 

 

However by focusing only their stock selections, you miss the great value they both add to Berkshire. Todd has been the CEO of GEICO for five years now and has been instrumental in its turnaround. Ted has also helped with German acquisitions and other private deals; and with the massive success BRK had with AAPL. 

 

I  as a long term shareholder, feel fortunate that we have both of them working for BRK. They have already added tremendous value and will continue to do so under Greg going forward. 

 

[ValueMaven]

I am a HUGE fan of both Todd and Ted btw ...

[gfp]

20m Apple shares were sold at avg. price of $201.80/sh.

 

 

Small additional purchases of 4 of the 5 Japanese sogo shosha (no Itochu)

 

I will attach the whole NICO naic file for anyone interested.  How do I get Wells Fargo to pay me 4.486% on my checking account like they do for Ajit?

 

NICO Q2 25 20087.2025.P.Q2.P.O.2.5028871.pdf