Berkshire Hathaway-Backed BYD Up 57% Since May

Minority Stock Positions, Stock Portfolio,

(BRK.A), (BRK.B)

Berkshire Hathaway-backed BYD’s stock (BYDDF) has been on a tear recently with a 57 percent rise in just under five weeks. The stock hit a low of $18 on May 10, 2021 and has since reached $28.19 on June 14, 2021.

BYD shares had been on a dramatic run in 2020 since rising from only $4.52 on March 20, 2020 to a peak of $35.94 on January 24, 2021. The stock then fell almost 50 percent to its May low.

Now, the stock has regained its momentum at an exciting time for the company.

In May, the one-millionth car, the Han EV, rolled off its production line at BYD’s headquarters and manufacturing facility in Shenzhen, China. And the company recently announced the delivery of the first 100 European-specification BYD Tang SUVs for customers in Norway, which is part of a larger 1,500 cars slated for Norway.

BYD and Berkshire Hathaway

In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares for $232 million. It’s an investment that has paid off handsomely. Berkshire’s original investment of $232 million has grown in value to $5.897 billion as of December 31, 2020.

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, and this article is not a recommendation on whether to buy or sell a stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Lubrizol Suffers Catastrophic Fire Forcing Evacuation in Illinois Town

Lubrizol

(BRK.A), (BRK.B)

Berkshire Hathaway’s Lubrizol Corporation has suffered a catastrophic fire at its Chemtool plant in Rockton. Illinois. The fire has multiple area fire departments battling the blaze, which was first called in around 7:00am. One firefighter has reportedly been injured.

The fire has forced the mandatory evacuation of everyone within a one-mile area of the plant, and people took shelter in the Roscoe Middle School.

“At approximately 7 a.m. today, local emergency personnel responded to a fire at the Lubrizol Corporation’s Chemtool Facility in Rockton, Ill. We have confirmed all on site are safe and accounted for. Our concern right now is for the safety of all our employees and the surrounding community. As a precaution, authorities have evacuated residents in a one-mile radius of the site. We do not yet know what caused this incident, but we will be working with local authorities and with our own risk management team to determine what happened and identify any corrective actions. We will share more details as they are known. We are grateful to our employees, first responders and safety forces responding to this incident,” Alicia Gauer, Senior Director, Global Communications for the Lubrizol Corporation said.

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

BYD Debuts Electric School Buses

Minority Stock Positions, Stock Portfolio,

(BRK.A), (BRK.B)

Berkshire Hathaway-backed BYD (Build Your Dreams) the world leader in electric vehicles, is introducing a battery-electric Type D school bus with unparalleled safety features and performance, wrapped in a sleek design that will have students wanting to step onboard.

With length options of 35, 38, and 40 feet, BYD’s Type D battery-electric school bus is perfect for transporting students to classes, field trips, as well as athletic and band events. The Type D can seat up to 84, and can be equipped with an ADA liftgate. The bus has a range of up to 155 miles on a single charge.

BYD’s smart technology creates a new environment where for bi-directional charging can be the norm. School buses can be charged overnight when energy demand is low, and clean emission free energy can be fed back into the classroom during school hours when the bus is parked keeping classrooms well-lit and students and teachers plugged-in.

“We are raising the bar for design, innovation, range and quality, giving parents peace of mind knowing their children are benefitting from the safest school bus anywhere,” said Stella Li, President of BYD North America. “At the same time, our buses will give operators the performance and cost savings that will make migrating to zero emission technology affordable and practical.”

BYD made safety the top priority in its school bus design, including such features as electronic stability control to aid handling, a collision avoidance system, and a 360-degree monitoring system to detect pedestrians and cyclists when the bus is operating at slow speeds.

In addition, BYD adds an additional layer of protection for children as they exit the bus with its Predictive Stop Arm™, which monitors approaching traffic and notifies students when it may not be safe to cross.

BYD buses can be equipped with IMMI’S Safeguard 3-point lap-shoulder belts, integrated child seats, and portable restraints. These school bus seats are not only designed to keep children safer, but they have the benefits of improving behavior, reducing bullying, and minimizing driver distraction.

“From the beginning, our team has always been focused on many key features,” said Samuel Kang, BYD’s Head of Total Technology Solutions. “We believed the Type D electric bus needed to be appealing to kids while at the same time offer the upmost safety features and driver ergonomics, be equipped with a safe, high-performance battery, and have plenty of storage capacity for road trips. The BYD Type D school bus achieves all those goals.”

With the driver being the first safety element, BYD drew from the experience of thousands of bus operators to enhance comfort and ergonomics in designing the driver’s cockpit. The driver’s area features comfort seats, an 18-inch power steering wheel and telescopic steering column, high level of visibility, and easy to reach control switches. The driver can also control the air conditioning over the cockpit in addition to controlling the system for passengers.

BYD and Berkshire Hathaway

In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares for $232 million. It’s an investment that has paid off handsomely. Berkshire’s original investment of $232 million had grown in value to $5.897 billion as of December 31, 2020.

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, and this article is not a recommendation on whether to buy or sell a stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Lessons From Warren Buffett: Asset Allocation Formulas are Pure Nonsense

Lessons From Warren Buffett, Value Investing, Warren Buffett,

Rebalancing your portfolio is something that is constantly preached by the financial industry, and if you don’t do it yourself, they are happy to create an account or a fund that does it for you automatically. However, Warren Buffett scoffs at the whole concept and sees it to be more about marketing than good investing.

“The idea that you have, you know, you say, ‘I’ve got 60 percent in stocks and 40 percent in bonds,’ and then have a big announcement, now we’re moving it to 65/35, as some strategists or whatever they call them in Wall Street do. I mean, that has to be pure nonsense,” Warren Buffett said at the 2004 Berkshire Hathaway Annual Meeting. “What you ought to do is have (as) your default position is always short-term instruments. And whenever you see anything intelligent to do, you should do it. And you shouldn’t be trying to match up with some goal like that… But so much of what you see when you talk about asset allocation, it’s just merchandising. It’s a way to make you think that if you don’t know how to determine whether it should be 60/40 or 65/35, that you need these people. And you don’t need them at all in investing.”

Hear Buffett’s full explanation

See the complete Lessons From Warren Buffett series

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Kraft Heinz Acquiring Assan Foods

Acquisitions, Kraft Heinz

(BRK.A), (BRK.B)

Berkshire Hathaway-backed The Kraft Heinz Company is acquiring Assan Foods from privately held Turkish conglomerate Kibar Holding in a deal that values the enterprise at approximately $100 million.

Assan Foods is a rapidly growing sauces-focused business with local manufacturing facilities in Balikesir and Izmir that has been a certified production partner for Kraft Heinz since 2019 and offers Kraft Heinz the opportunity to build its retail and foodservice business across Europe, the Middle East and Africa.

The deal is expected to be completed in the second half of 2021.

“This is a great opportunity to accelerate our international growth strategy centered on Taste Elevation,” said Rafael Oliveira, International Zone President at Kraft Heinz. “We believe Assan Foods is a high-performance organization that brings best-in-class local innovation and production of sauces and tomato products, as well as a significant distribution network in the fast-growing foodservice channel, enabling us to further build our scale and agility by expanding the Heinz brand in Turkey, as well as our International Taste Elevation platform more broadly.”

Headquartered in Istanbul, Assan Foods was established in Balikesir in 1998 as a Kibar Holding investment in the food sector and evolved into one of the top producers in the region. Assan Foods manufactures and sells a wide range of products including tomato paste, ketchup, mayonnaise, and pasta and meat sauces that appeal to a variety of international cuisines and are sold under brands such as Colorado, Kingtom, and Oba, as well as private label. With approximately 400 employees, Assan Foods serves the domestic market and exports to around 50 countries on four continents.

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, and this article is not a recommendation on whether to buy or sell a stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Oriental Trading Company to Launch Marketplace

Retail

(BRK.A), (BRK.B)

Berkshire Hathaway’s Oriental Trading Company, Inc., the nation’s largest direct retailer of value-priced party supplies, arts and crafts, toys, novelties, and school supplies, will expand its e-commerce presence by launching a third-party seller marketplace powered by Mirakl.

The marketplace is set to debut this summer, and Oriental Trading plans to add millions of curated products to its core product categories from selected brands and sellers.

“Oriental Trading will be the first company in the celebration, education and craft retail space to provide a marketplace of this scale to online customers,” said Steve Mendlik, President and CEO of Oriental Trading Company. “Our company’s vision is about making life more fun and that’s exactly what we’re building for our customers with this new solution. By creating this robust marketplace, customers can easily get everything they need, at the prices they want and in one place.”

“We are thrilled to play a part in helping Oriental Trading launch the first marketplace in their retail space,” said Adrien Nussenbaum, Mirakl U.S. CEO and co-founder. “As a leader in the industry, this marketplace fits perfectly into Oriental Trading’s long-term strategy, allowing them to disrupt the market and strengthen their position as a solution company by leveraging their assortments and value platforms.”

Oriental Trading currently offers over 50,000 products across categories like party supplies, events, toys and games, arts and crafts, teaching supplies, wedding, faith, and home décor.

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell a stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Berkshire Hathaway’s MidAmerican Energy Hit With Lawsuit Alleging Excessive Charges During Texas Winter Storm

Berkshire Hathaway Energy

(BRK.A), (BRK.B)

A North Texas plastics company has filed a proposed class action lawsuit against Berkshire Hathaway’s MidAmerican Energy Services, alleging the electricity supplier passed through unauthorized fees to commercial customers with contracts marketed as fixed-rate plans.

MidAmerican supplies electricity to roughly 15,000 customers in Texas.

According to the filing in federal district court in Marshall, lead plaintiff J&M Plastics, located in Royse City northeast of Dallas, received a statement from MidAmerican in April that included eight line-item charges for “Supplemental Ancillary Services.” Those charges, assessed during the week of the February 2021 winter storm, totaled almost $54,000, more than three times the amount of the company’s typical monthly bill.

The MidAmerican contract states that the fixed-price plan includes “costs associated with line loss…all charges assessed by ERCOT…and other costs required to facilitate delivery of electricity to Customer’s Delivery Points.”

But according to the lawsuit, MidAmerican ignored the terms of its fixed-price agreement and informed customers that “MidAmerican Energy Services will not increase the energy component of your bill, however, non-energy costs such as ancillary charges billed by ERCOT and your local utility, are not fixed and are passed through on your bill.”

J&M management kept the 55,000 square foot facility heated during the storm to keep pipes from freezing but did not operate. The company employs more than 40 full-time workers and manufactures a variety of consumer products from recycled plastic.

“MidAmerican has already acknowledged that it can’t pass through these same costs to their residential and small business customers, because of the Public Utility Commission’s consumer protection regulations,” says Derek Potts of the Potts Law Firm in Houston. “But the company’s still trying to unlawfully use a statewide disaster to take advantage of and price-gouge thousands of larger commercial customers.”

“They can’t justify passing through these costs when J&M and other customers agreed to a fixed-price electricity plan, which specifically includes any ancillary and ERCOT-assessed charges,” says Potts.

The lawsuit alleges violation of the Texas Deceptive Trade Practices Act, among other claims for breach of contract, negligence and misrepresentation.

The lawsuit is J&M Plastics, Inc. v. MidAmerican Energy Services, Case No.2:21-cv-00206, filed in the U.S. District Court for the Eastern District of Texas in Marshall.

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell a stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Berkshire Hathaway HomeServices Expands Into Greece

Berkshire Hathaway HomeServices

(BRK.A), (BRK.B)

Berkshire Hathaway HomeServices, one of the world’s fastest-growing residential real estate brokerage franchise networks, has expanded into Greece.

Berkshire Hathaway HomeServices, one of the world’s fastest-growing residential real estate brokerage franchise networks, announced today that ENEA Real Estate is now part of its global brokerage network and will operate as Berkshire Hathaway HomeServices Athens Properties. The company will add one office and 18 real estate consultants to the global network and will service Attica as well as the main tourist destinations of Greece.

“When I established ENEA Real Estate, my vision, and promise was to create a real estate brand that would be the consumer’s first choice for the Greek real estate market,” said Kyriakos Xydis, Managing Partner of ENEA Real Estate. “Now that we are part of the global real estate network of Berkshire Hathaway HomeServices, we can now take that vision and expand so much further with the resources available to network members.”

“Joining Berkshire Hathaway HomeServices brand gives us the opportunity to be part of a strong global brand, which is widely recognized and respected,” said George Karakovounis, ENEA Real Estate Partner. “We have important goals over the next few years, and we knew making this decision would put us on route to achieve them.”

“I am thrilled to welcome Kyriakos, George and their team of ambitious real estate professionals to our global network,” said Chris Stuart, CEO of Berkshire Hathaway HomeServices. Joining the network will elevate the team’s already locally trusted company globally. “Under the Berkshire Hathaway HomeServices name, their leadership and agents are immediately connected to over 50,000 real estate professionals around the globe.”

By joining, Berkshire Hathaway HomeServices Athens Properties agents gain access to Berkshire Hathaway HomeServices’ active referral and relocation networks, and its “FOREVER Cloud” technology suite, a powerful source for lead generation, marketing support, social media, video production/distribution and more. Berkshire Hathaway HomeServices has aligned with best-in-class technology platforms to deliver world-class support to its network members far into the future.

Berkshire Hathaway HomeServices Athens Properties will also have full access to the recently unveiled, Real Estate I.Q. System. The System combines the Berkshire Hathaway HomeServices brand, marketing resources and technology with continuing education, training, mentoring and consulting. The brand also provides global listing syndication, professional training and ongoing education and the exclusive Luxury Collection marketing program for premier listings. Its Prestige Magazine showcases network members’ premium listings with a strong lineup of feature stories covering topics that appeal to high-end real estate clients.

“We are excited to enter the market of Attica with a excellent company such as ENEA Real Estate,” said Gino Blefari, Chairman of Berkshire Hathaway HomeServices. “The Greek real estate market offers tremendous opportunities and we are thrilled to officially welcome Berkshire Hathaway HomeServices Athens Properties as our first brokerage in this renowned location.”

Berkshire Hathaway HomeServices recently added its first brokerage in India and Portugal, as well.

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell a stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Lessons From Warren Buffett: Should You Wait for a Price Decline Before Buying a Great Stock?

Lessons From Warren Buffett, Value Investing, Warren Buffett,

You have done your research and identified a great company. It’s a company that you think will grow and bring great returns for the next 20-30 years, and you are dying to add it to your portfolio. But then a little voice creeps into your head, saying “Maybe I should wait for a price decline?” So, should you wait for price declines before buying great companies?

“I think it’s better just to own them,” Warren Buffett said at the 1996 Berkshire Hathaway Annual Meeting. “So, to sit there and hope that you buy them in the throes of some panic, you know, that you sort of take the attitude of a mortician, you know, waiting for a flu epidemic or something… I’m not sure that will be a great technique.”

(Note: That this doesn’t mean that you should buy at any price, and that Buffett says that he wouldn’t buy a stock if it is selling at an “egregious price.”)

Buffett’s full explanation

See the complete Lessons From Warren Buffett series

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Berkshire Hathaway Renewables Acquires Iowa Wind Farm

Acquisitions, Berkshire Hathaway Energy

(BRK.A), (BRK.B)

BHE Renewables, a subsidiary of Berkshire Hathaway Energy, has completed the acquisition of the 54-megawatt Independence wind energy project from RPM Access LLC, a small regional developer of utility grade wind generation projects in the Midwest.

Located near Ryan, Iowa, the project consists of 18 GE 2.8-megawatt wind turbines and two GE 2.3-megawatt wind turbines and will be completed in fourth quarter 2021. The project will serve Central Iowa Power Cooperative under a 20-year power purchase agreement signed in 2020 by RPM Access.

“The addition of the Independence wind project grows our wind energy portfolio to 1,719 megawatts and provides another opportunity for us to meet the growing demand for energy generated from renewable resources,” said Alicia Knapp, president and CEO of BHE Renewables. “We are excited about this project and look forward to finding more opportunities to own and operate renewable energy resources that support a cleaner energy future.”

BHE Renewables other wind projects include the 300-megawatt Jumbo Road project near Hereford, Texas; 168-megawatt Pinyon Pines I and 132-megawatt Pinyon Pines II projects, located near Tehachapi, California; 81-megawatt Bishop Hill II project in Henry County, Illinois; 400-megawatt Grande Prairie project in Holt County, Nebraska; 72-megawatt Marshall project in Marshall County, Kansas; 212-megawatt Walnut Ridge project in Bureau County, Illinois; and the 300-megawatt Santa Rita wind project in Reagan and Irion counties in west-central Texas.

© 2021 David Mazor


Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell a stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.