Buffett Stays In the News
In February, Buffett told CNBC that he thought Apple wasn’t a stock, but probably the best business he knew in the world and that is a bigger commitment that we have in any business except insurance and the railroad. To be exact, Buffett $90 billion Apple stake represents 20% of Berkshire Hathaway's market value.
Two months ago, Warren Buffett’s Berkshire Hathaway disclosed that it sold large blocks of stock in Delta Air Lines and Southwest Airlines. In recent months, during Berkshire’s annual shareholders’ meeting, Warren Buffett said the world has changed because of the COVID-19 and that he had been wrong to invest in the airline industry. As a result, his company sold its stake in American airline companies which consisted: 11% stake in Delta Air Lines, 10% of American Airlines, 10% of Southwest Airlines, and 9% of United Airlines.
President Trump said Buffett sold the airlines a while back and although he’s been right his whole life, he made a mistake because the airline stocks went through the roof. At the time, the airlines were on fire since Buffett sold them with United, Delta and American Airlines up 16.8%, 10.4% and 21% in a single day several weeks ago.
Dave Portnoy, founder of Barstools boosted that he made money buying the airlines after Buffett sold all his stock in the airline companies. He went on to say that day trading was owning his own printing press because of the profits he was making. Even when as far as saying Buffett was “washed up” and that he was the new breed, the new generation.
NOTE: Yesterday Delta reported their quarterly earnings. The company lost $4.33 a share during the second quarter, worse than the $4.06 per-share expected. Revenue fell 88% to $1.47 billion.
In April 2019, Buffett invested $10 billion in integrated oil-and-gas play Occidental Petroleum to help finance its bid for exploration-and-production firm Anadarko Petroleum. In return, Berkshire received 100,000 preferred shares yielding 8%. Carl Icahn, called the deal "hugely overpriced." Carl fought tooth and nail with Occidental Petroleum over it pending purchase of Anadarko Petroleum because he knew the company overpaid for Anadarko and it could endanger Occidental’s future if oil prices sink.
Lets hope Buffett has better success with his most recent acquisition.
The conglomerate is spending $4 billion to buy the natural gas transmission and storage assets of Dominion Energy. Including the assumption of debt, the deal totals almost $10 billion. It’s Berkshire’s first major purchase since the coronavirus pandemic and subsequent market collapse in March.
For Dominion, the move is part of its transition to a pure-play regulated utility company that focuses on clean energy production from wind, solar and natural gas.
For Berkshire, the move greatly increases its footprint in the natural gas business. With the purchase, Berkshire Hathaway Energy will carry 18% of all interstate natural gas transmission in the United States, up from 8% currently.
That's certainly a better looking chart than the Occidental chart and unlike Occidental, Dominion pays a 5% dividend.
This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.
Posted Using LeoFinance
