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发帖数: 11530 | 1 Warren Buffett’s annual letter is out-- 7 things that will have everyone
talking
Yahoo Finance By Nicole Sinclair
1 hour ago
Warren Buffett released his annual letter to shareholders of Berkshire
Hathaway (BRK-B) Saturday morning. Every year it is one of the most widely
read documents in the business world for its smart, funny and sometimes
controversial insights from the Oracle of Omaha. Here are the seven things
everyone will be talking about from this year’s letter:
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(1) Berkshire had a good 2015, despite what the stock did
In a flat 2015 market, Berkshire fell about 12%, its worst decline since
2008. Buffett focused on the company’s 6.4% gain in book value -- the
financial metric that he’s always used as an indicator of his conglomerate
’s progress. Even though this was below the 13% average book value gain
since the recession, it outpaced the 1.4% gain in the S&P including
dividends.
Buffett reiterated his previous assertion that Berkshire will repurchase
stock if the value of Berkshire is at or below 1.2x book. Currently it is
trading at about 1.3x book, which perhaps limits downside of the shares.
Owned businesses
Berkshire now owns 10 ¼ companies outright (including the 27% Kraft
Heinz stake) that would be listed on the Fortune 500 were they independent.
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BRK-B131.92-0.29%
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“That leaves just under 98% of America’s business giants that have yet to
call us. Operators are standing by."
Berkshire’s large insurance operations -- which earned $4.9 billion in 2015
versus $5.2 billion in 2014 -- put some downward pressure on results.
However, an increase in “float” to $88 billion in these businesses can
allow the company to fund investments. Buffett reminded investors why
insurance has been good for Berkshire over the five decades he’s run the
company.
In 2015, all of Berkshire’s other businesses -- including a railroad,
utilities and energy, financial products, manufacturing and retail -- were
more profitable than the previous year.
Buffett highlighted the turnaround in the company’s biggest non-insurance
business: BNSF railroad, which improved its service to customers after $5.8
billion of capital spending.
Together with BNSF, the "Powerhouse Five" -- which includes Berkshire's five
most profitable non-insurance businesses -- earned $13.1 billion in 2015.
The acquisition of aerospace industry supplier Precision Castparts that
closed in January will make the group the “Powerhouse Six.”
Public investments
Some investors have criticized Buffett’s commitment to major stock holdings
, including American Express (AXP) and IBM (IBM). These two, which were down
26% and 11% in 2015, along with Coca-Cola (KO) and Wells Fargo (WFC), make
up his “Big Four” investments. But Berkshire was not a seller of those
stocks, so no realized losses hit the company’s bottom line. He reiterated
his confidence in the investments:
“At Berkshire, we much prefer owning a non-controlling but substantial
portion of a wonderful company to owning 100% of a so-so business. It’s
better to have a partial interest in the Hope Diamond than to own all of a
rhinestone.”
(2) The presidential candidates are “dead wrong” about the economy
Don’t look for any mentions about oil, China, FX, monetary policy in the
Berkshire letter.
But Buffett did emphasize that the domestic economy is strong, despite what
politicians contend. He is typically upbeat on the long-term prospects of
the U.S. economy. And this year is no different, as the ultimate value
investor highlighted “generational opportunities.”
“It’s an election year, and candidates can’t stop speaking about our
country’s problems (which, of course, only they can solve). As a result of
this negative drumbeat, many Americans now believe that their children will
not live as well as they themselves to. That view is dead wrong: The babies
being born in America today are the luckiest crop in history."
American GDP per capita is now about $56,000 -- six times the amount in 1930
(the year Buffett was born) in real terms. “America’s economic magic
remains alive and well."
(3) Climate change is a risk
Buffett said the insurance business would not be affected by climate change
in the near term. However, he believes even a small threat to our
environment should be met with action.
“If there is only a 1% chance the planet is heading toward a truly major
disaster and delay means passing a point of no return, inaction now is
foolhardy. Call this Noah’s Law: If an ark may be essential for survival,
begin building it today, no matter how cloudless the skies appear.”
(4) A major attack is a “clear, present and enduring danger”
“There is, however, one clear, present and enduring danger to Berkshire
against which Charlie and I are powerless. That threat to Berkshire is also
the major threat our citizenry faces: a 'successful' (as defined by the
aggressor) cyber, biological, nuclear or chemical attack on the United
States.”
“’Innovation’ has its dark side. There is no way for American
corporations or their investors to shed this risk.”
(5) Productivity is good for society, but it comes at a cost
Buffett spent time in his 2015 letter to highlight a solution to
unemployment caused by paradigm shifts in productivity. He believes in the
net benefit to society from improved productivity: “The answer in such
disruptions is not the restraining or outlawing of actions that increase
productivity. Americans would not be living nearly as well as we do if we
had mandated that 11 million people should forever be employed in farming.”
However, he says safety nets are paramount: “The solution, rather, is a
variety of safety nets aimed at providing a decent life for those who are
willing to work but find their specific talents judged of small value
because of market forces. (I personally favor a reformed and expanded Earned
Income Tax Credit that would try to make sure America works for those
willing to work.) The price of achieving ever-increasing prosperity for the
great majority of Americans should not be penury for the unfortunate.”
(6) Personal highlight: Buffett celebrates technological progress but isn't
ready for tinder
“I now spend ten hours a week playing bridge online. And, as I write this
letter, ‘search’ is invaluable to me. (I’m not ready for Tinder, however.
)”
(7) Buffett is pumped to webcast the meeting on Yahoo! Finance
As previously announced, Yahoo Finance will be hosting the first-ever live
stream of Berkshire’s annual shareholder meeting on April 30. Buffett said
in his letter that: “Charlie and I have finally decided to enter the 21st
Century. Our annual meeting this year will be webcast worldwide in its
entirety.”
The webcast can be found at https://finance.yahoo.com/brklivestream and will
begin with a half hour of interviews with managers, directors and
shareholders followed by a livestream of the event.
Buffett said the recent limits on capacity in Omaha motivated him to webcast
the event. But, in addition, he said that it’s the age of Buffett, 85, and
vice-chairman Charlie Munger, 92, that motivated him. All shareholders,
Buffett says, should be able to see how the two men look and sound and to
make sure they haven't "drifted off into la-la land."
Their life-prolonging diet seems to be the secret: "During the meeting,
Charlie and I will each consume enough Coke, See’s fudge and See’s peanut
brittle to satisfy the weekly caloric needs of an NFL lineman." | l***o
发帖数: 5337 | 2 85岁和92岁。。。这一对传奇人物要携手走多久呢？
【在 W***n 的大作中提到】
: Warren Buffett’s annual letter is out-- 7 things that will have everyone
: talking
: Yahoo Finance By Nicole Sinclair
: 1 hour ago
: Warren Buffett released his annual letter to shareholders of Berkshire
: Hathaway (BRK-B) Saturday morning. Every year it is one of the most widely
: read documents in the business world for its smart, funny and sometimes
: controversial insights from the Oracle of Omaha. Here are the seven things
: everyone will be talking about from this year’s letter:
: Related Stories
| G****g
发帖数: 542 | |
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