Berkshire Hathaway (BRKB) reported operating earnings fell 8% in the fourth quarter while Warren Buffett’s conglomerate continued to add to its cash holdings.
Along with its earnings release Saturday, the conglomerate shared its 2022 annual report, including Buffett’s famous letter to shareholders.
Buffett’s Berkshire repurchased shares to the tune of $2.855 billion last quarter, for a full-year total of $7.9 billion. That’s down sharply from $27 billion in 2021 and $24.7 billion in 2020.
A separate 10-Q filing revealed it was a net seller of stocks during that period.
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Investors already know that investing legend Buffett’s Q4 stock buys included Apple (AAPL) and his Q4 stock sells included Taiwan Semiconductor (TSM), based on Berkshire’s latest quarterly 13F filing.
Revenue and earnings for Buffett’s Berkshire derive from diverse operating companies as well as its vaunted portfolio of equity investments.
Berkshire Earnings From Operating Businesses
For Q4, operating earnings — Buffett’s preferred measure for assessing performance — fell 8% vs. a year earlier to $$6.7 billion. Excluding currency effects, operating profit would have climbed 13%.
The businesses Berkshire operates include insurance and reinsurance, utilities and energy, freight rail transportation, manufacturing and retailing.
In Q4, Berkshire earnings from insurance underwriting fell 34% to $244 million. Its insurance investment income swelled 64% to $2 billion.
Rail earnings fell 12.8% vs. a year earlier to $1.47 billion. Utilities and energy earnings grew nearly 24% vs. a year earlier to $739 million.
Berkshire Stock Investments
Overall net income tumbled 53% to $18.1 billion in Q4, reflecting lower investment gains.
Berkshire’s stock portfolio includes a monster stake in iPhone maker Apple. It also includes a large and growing one in Occidental Petroleum (OXY) amid the recent oil price surge.
Berkshire’s cash hoard swelled to $128.651 billion from almost $109 billion in Q3. Warren Buffett, in his annual shareholder letter, said Berkshire Hathaway will keep holding a “boatload” of cash and Treasury bills. But he also decried critics of stock buybacks as “an economic illiterate or a silver-tongued demagogue.”
BRKB Stock, Warren Buffett Stock Holdings
Class-B shares of Berkshire Hathaway eased 0.3% to 303.37 in Friday’s stock market.
Heading into the Q4 earnings report, BRKB stock undercut the 50-day moving average. But Berkshire stock has held up well year to date, aided by the strength in Berkshire’s energy unit and the rotation into value stocks.
Apple stock rose 0.3% to 149.40 Friday. OXY stock gained 1.4%.
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