Month: February 2023

Categories
Insurance

GEICO Expanding in Texas

Berkshire Hathaway’s GEICO hosted a ceremony on February 15 to celebrate the expansion of its commercial insurance operations at its office in Katy, Texas, which will support this growing area of GEICO’s business. With this expansion, GEICO expects to add 250-500 new positions in Katy over the next five years.

“The hundreds of jobs we’re adding here in Katy over the next few years will primarily focus on small business insurance sales and customer service,” said Melissa Gallaro, GEICO senior vice president. “We need outgoing, solutions-oriented individuals to work with our customers to help them find the coverage that makes most sense for the type of business they own.”

Gallaro also noted the significant growth GEICO’s commercial insurance business has experienced over the past year “Our investment in the Houston area will allow us to effectively manage that growth as more business owners realize how easy it is to buy coverage through GEICO,” Gallaro said.

Future job openings will include insurance sales and customer service positions.

© 2023 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.

Categories
Lessons From Warren Buffett

Lessons From Warren Buffett: Always Think of Stocks as Businesses

Warren Buffett focuses on individual stocks and their value as partial ownership of companies rather than their daily price movements or whether the market as a whole is up or down.

“We look at individual businesses. And we don’t think of stocks as little items that wiggle around on the paper and that have charts attached to them,” Buffett said at the 1999 Berkshire Hathaway annual meeting. “We think of them as parts of businesses.”

Hear Buffett’s full explanation

See the complete Lessons From Warren Buffett series

© 2022 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.

Categories
Warren Buffett

Warren Buffett Defends Stock Buybacks

(BRK.A), (BRK.B)

In his Berkshire Hathaway Chairman’s Letter that opens the Berkshire Hathway 2022 Annual Report, Warren Buffett took umbrage with politicians and other voices that attack corporate share repurchases. He wrote:

Gains from value-accretive repurchases, it should be emphasized, benefit all owners – in every respect. Imagine, if you will, three fully-informed shareholders of a local auto dealership, one of whom manages the business. Imagine, further, that one of the passive owners wishes to sell his interest back to the company at a price attractive to the two continuing shareholders. When completed, has this transaction harmed anyone? Is the manager somehow favored over the continuing passive owners? Has the public been hurt?

When you are told that all repurchases are harmful to shareholders or to the country, or particularly beneficial to CEOs, you are listening to either an economic illiterate or a silver-tongued demagogue (characters that are not mutually exclusive).

In 2022, Berkshire repurchased a modest 1.2% of the company’s outstanding shares.

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.

Categories
BNSF

BNSF Agrees to Sick Leave With Two Unions

(BRK.A), (BRK.B)

BNSF Railway has become the fourth of the seven Class I railroads to announce an agreement for paid sick leave with some unionized workers, reaching agreement with the Transportation Communications Union and the National Conference of Firemen and Oilers.

The TCU agreement applies to insourced intermodal equipment operators, which represent a majority of the union’s members at the BNSF. Other TCU members already had paid sick days in their agreement.

“We hope these are the first of a series of new agreements across our other crafts who did not already have individual paid sick days prior to the recent national bargaining round,” BNSF said in a statement. “Today’s agreements are part of a collaborative effort aimed toward modernizing the work environment and addressing quality of life.”

As in agreements at other railroads, members of the two unions will receive four paid days off to use as sick days and will have the ability to convert up to three personal leave days to sick days each year.

BNSF joins CSX Transportation (which has agreements with six unions), Union Pacific (two unions), and Norfolk Southern (one union) in announcing sick-time agreements with some labor unions.

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.

Categories
Brooks

Brooks Running Achieves Record Revenue in 2022

(BRK.A), (BRK.B)

Berkshire Hathaway’s Brooks Running crossed the finish line in 2022 with record global revenue, up 6% over 2021 with growth in all regions, and direct-to-consumer sales up 16%.

The brand navigated supply chain obstacles during the first half of the year, returning to complete inventories in the back half with a record fourth quarter, up 26% year over year.

In January 2022, Brooks became the top brand at U.S. retail in adult performance running footwear, maintaining that position through the year to finish with 21% market share.

For 2022, Brooks again held the No. 1 and No. 2 spots in adult performance footwear styles sold at U.S. retail with the Ghost and Adrenaline GTS respectively, contributing to the running brand’s strong momentum heading into 2023.

Brooks competed for customers across run categories in 2022 with innovative products and key initiatives in cushion, speed, trail, and walking. Notably, the launch of the new Glycerin 20 Super Franchise with a nitrogen-infused midsole offers runners more choice in fit and support, with the addition of the GTS stability system and a new StealthFit option alongside Brooks’ classic fit.

“In 2022, Brooks overcame economic and supply chain headwinds to gain new customers across all categories including running, walking, hiking, and more,” said Jim Weber, CEO at Brooks Running. “As we head into the new year, we’re positioned for continued growth in multiple fitness and outdoor performance categories.”

Expanding global reach and capacity

In 2022, Brooks focused on opportunities to engage runners and better service customers in key markets around the globe. During the year, Brooks launched e-commerce sites in six additional countries and invested in new distribution centers in the U.S. and U.K. to address increasing demand and scale for growth.

In the Europe, Middle East, and Africa region, Brooks grew revenue 15% in local currency year over year. The Asia Pacific and Latin America region grew 33%, with Australia and China up 24% and 21% respectively, driven by wholesale success and a digital-first approach.

Running retailers around the world recognized Brooks for its brand strength and best-in-class service. Brooks was recently named as the top running brand in Canada by independent running retailers in 4 of 5 categories when surveyed by the IRRC (Independent Running Retailers of Canada).

German publication SAZ, a trade publication that tracks retailer sentiment, recognized Brooks as running brand of the year for the sixth year in a row.

In the U.S., Brooks ranked No. 1 overall in Brand Rating and Ranking in this year’s Running Dealer Report issued by the Running Industry Association (RIA).

Connecting with runners and fostering growth in community

Brooks made investments in the running community in 2022 through new initiatives, including the August launch of the “It’s Your Run” global brand campaign, which celebrates runners of all types on their journeys to achieving their best runs. Coinciding with the campaign, the brand grew 2 points of unit share at U.S. retail for adult performance running footwear from August to December 2022, year over year.

The brand’s loyalty program, Brooks Run Club, hit nearly a quarter million memberships last year as the community expanded from digital events to include physical activations across the U.S.

Brooks also organized events at marquee trail and road races this year, including Ultra-Trail du Mont Blanc (UTMB) in Chamonix, France, and the Boston and New York City Marathons. Brooks-sponsored athletes blazed new trails, with CJ Albertson setting the world record in the 50k at 2:38:43 and Josh Kerr clocking 3:48:87 to break the British and European indoor mile records at the Boston University Last Chance Meet.

Last year’s Sasquatch by Louie Gong (Nooksack) collection and Run Proud collaboration with LGBTQ+ artist Lisa Congdon celebrated diverse identities within running and supported Brooks’ goal to champion the run for all.

Brooks also extended its existing relationship with free community event group parkrun, becoming parkrun’s exclusive global footwear partner and the presenting partner in the U.S., Germany, and the Netherlands through 2028, supporting the organization’s growing community that currently includes eight million registered participants in more than 20 countries.

Poised for success in the new year

As Brooks looks ahead to 2023, the brand will continue to meet the evolving needs of runners through product innovation and advancements in nitrogen-infused midsoles and assisted transitions, including its Glideroll rocker. Market trends project growth in running and walking participation, and Brooks will deliver new speed, trail, and cushion products to meet that demand. Brooks will also take further steps down its People and Planet path by deepening investments in youth running and developing elite athletes. Brooks will also launch additional carbon neutral products and a new Green Silence shoe that will showcase advancements in sustainability.

“The future has never been brighter for performance running,” added Weber. “We look forward to introducing more runners to Brooks this year, giving them the premium fit, performance, and experience they desire from their gear while connecting uniquely through our Run Happy spirit.”

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.

Categories
Appointments

Berkshire’s Intero Names New President

(BRK.A), (BRK.B)

Intero, Berkshire Hathaway’s wholly owned subsidiary of HomeServices of America, Inc., has announced that Scott Chase has been named president of the company and Terry Meyer has been promoted to the role of chief operating officer.

“At Intero, we are constantly evolving to optimize the talents and skills of our seasoned leaders, and to stay ahead of the competition,” said Brian Crane, CEO. “The depth and breadth of our collective senior executive experience sets a high bar and allows us to meet the needs of our agents and clients no matter what the market is doing.”

Scott Chase has been promoted to president from his previous role of COO, a position he held for the last two years.

Chase joined Intero in November of 2018 after a successful stint as regional sales manager at Opes Advisors. During his four years with Intero, Chase contributed to the company’s continued success with his business philosophy focused on planning and continuous improvement in skills, systems, and teams. In addition to his new role as President, he will continue to manage the Los Altos and Menlo Park offices and report directly to CEO Brian Crane. Chase will bring attention to growing revenue and agent differentiation through innovative partnerships, products, and services; in addition, he will be responsible for the company’s growth through Acquisitions, Tuck-Ins and Franchising.

“When agents come to Intero, they come to learn from the best in the business,” said Chase. “Intero as a whole, leverages collaboration, creativity and years of experience to establish a unique culture of specialized education and agent expertise that cannot be found anywhere else.”

Terry Meyer has been promoted to COO and will combine this with his continuing leadership roles as managing officer of Intero’s Los Gatos office and general manager of Intero’s Commercial Division.

Intero serves Northern California and Nevada with 20 offices throughout the greater Silicon Valley, San Francisco, Calaveras County, Western Nevada, and the Greater Lake Tahoe Region. The Intero Franchise network comprises 33 affiliates located in California, Nevada, Tennessee, and Texas. The company is headquartered in the heart of California’s Silicon Valley.

© 2023 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.

Categories
Lessons From Warren Buffett

Lessons From Warren Buffett: How Warren Buffett Thinks About Risk

Risk for Warren Buffett is not just the risk that a business has at the moment, but also includes the risks it may face many years in the future.

“We think of business risk in terms of what can happen, say 5, 10, 15 years from now, that will destroy, or modify, or reduce the economic strengths that we perceive currently exist in a business,” Buffett said at the 2000 Berkshire Hathaway annual meeting. “When we look at businesses, we try to think of what can go wrong with them. We try to look [for] businesses that are good businesses now, and we think about what can go wrong with them. If we can think of very much that can go wrong with them, we just forget it. We are not in the business of assuming a lot of risk in businesses.”

Hear Buffett’s full explanation

See the complete Lessons From Warren Buffett series

© 2023 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.

Categories
Acquisitions

Pilot Company Is Now a Berkshire Hathaway Subsidiary

Berkshire Hathaway has moved from a minority ownership stake to a majority ownership stake in Pilot Company, the largest operator of truck stops and rest stops in North America.

In January, Berkshire acquired its long-planned 80 percent equity position in Pilot from the Haslam family, and the family continues to have a 20 percent stake in the company.

In 2017, Berkshire took a 38.6% stake in Pilot, which has 800 locations under the Pilot and Flying J brands.

Pilot is currently in the midst of its three-year $1 billion New Horizons project that is its most significant investment in store modernization to date. It will fully remodel more than 400 Pilot and Flying J travel centers and make additional upgrades at several more locations across the country.

© 2023 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.

Categories
BYD

BYD to Build 543 MWh Energy Storage Project in Las Vegas

(BRK.A), (BRK.B)

Berkshire Hathaway-backed BYD will construct a battery energy storage project for Las Vegas.

BYD announced recently that a 543 MWh Cube Pro liquid-cooled Battery Energy Storage System (BESS), integrated by Energy Vault, will be deployed by NV Energy outside of Las Vegas with construction on the project beginning in the second quarter of 2023.

NV Energy awarded the project to Energy Vault, and expects to begin commercial operation by the end of 2023.

The energy storage system is designed to store and dispatch excess renewable energy, including wind and solar power. The BYD Cube Pro BESS will be charged daily and is designed to send stored renewable energy to the grid during peak consumption hours, helping meet high demand.

“We are pleased to be involved in this significant project,” BYD Senior Director of Business Development Michael Liu said. “This effort will be beneficial to residents of the Las Vegas region, and the entire state of Nevada.”

“Energy Vault is excited to partner with NV Energy and BYD to integrate and deliver, on a turn-key basis, a mission critical BESS that will support Nevada’s largest electric provider in achieving its goal of net zero emissions by 2050,” said Omar Aoun, Vice President of Sales, North America at Energy Vault. “This collaboration proves the quality and flexibility of our services. Our ability to work with key players such as NV Energy and BYD will accelerate the delivery of one of the largest BESS in Nevada, which is designed to store and dispatch excess renewable energy to help meet the high demand during Nevada’s peak load hours.”

The BYD Cube Pro is the latest generation energy storage solution designed for larger utility-scale projects. At 2.6 MWh per unit, the Cube Pro utilizes a liquid-cooled battery system within its enclosure allowing for an 80% increase in energy density over previous generations.

BYD has been committed to the North America Energy Storage market for almost a decade, with the first MW-scale project deployed in the U.S. in 2011. It has remained a market leader since then with more than 4GWh delivered in the U.S and an additional 14GWh confirmed order to be delivered in 2023 and 2024.

© 2023 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.

Categories
Lessons From Warren Buffett

Lessons From Warren Buffett: Only Buy What You Understand

If a sector you know nothing about is booming, should you still buy it? Not if you are Warren Buffett.

“We will never buy anything we don’t think we understand,” Buffett said at the 2000 Berkshire Hathaway annual meeting. “And our definition of understanding is thinking that we have a reasonable probability of being able to assess where the business will be in 10 years.”

Hear Buffett’s full explanation

See the complete Lessons From Warren Buffett series

© 2023 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.