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Berkadia

Berkadia Announces Financing of Vanguard Landing in Virginia Beach

(BRK.A), (BRK.B)

Berkadia, Berkshire Hathaway’s joint venture with Jefferies Financial Group, completed the financing of Vanguard Landing, a 128-bedroom community to be developed in Virginia Beach, Virginia. Senior Managing Director John Reed of Berkadia Richmond and Managing Director John Richards of Berkadia Norfolk secured $31.85 million in construction/permanent financing through Virginia Housing Development Authority on behalf of the non-profit developer, Virginia Beach-based Vanguard Landing, Inc. The deal closed on April 29.

The 40-year loan featured a 6.25 percent permanent interest rate and a 40-year amortization schedule.

“This is a ‘first of its kind’ development in the Commonwealth of Virginia and thus the first property financed by Virginia Housing,” said Reed. “This fact alone presented some challenges for all parties involved throughout a very lengthy process. The fact that we were able to get this done testifies to the worthiness of this project, in addition to the perseverance of the Berkadia, Vanguard Landing, and Virginia Housing teams.

“At the end of the day, this development allowed Virginia Housing to fulfill one of its missions to provide housing for individuals with intellectual and developmental differences and will be the first of its kind in Virginia, and we are proud to present this opportunity to them,” said Richards. “We look forward to the Vanguard team getting the project built and completed and perhaps working with them on additional like-communities elsewhere in Virginia.”

© 2024 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.

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Berkshire Hathaway Specialty Insurance

Amy Bowman Promoted to Head of Multinational at Berkshire Hathaway Specialty Insurance

(BRK.A), (BRK.B)

Berkshire Hathaway Specialty Insurance (BHSI) has announced the promotion of Amy Bowman to the position of Head of Multinational. Bowman, previously serving as Vice President of Multinational, brings over two decades of experience as an attorney and insurance leader to her new role.

In her previous roles at BHSI, Bowman demonstrated her capabilities in various capacities. Joining the company in 2014 as Counsel for Executive & Professional, Healthcare, and Small Commercial Business, she quickly rose through the ranks. Bowman later assumed the role of Assistant Vice President of Transactional Liability, where she spearheaded the establishment and growth of BHSI’s Transactional Liability business in the U.S.

Her journey within BHSI continued as she took on increasingly strategic roles. As Assistant Vice President and subsequently Vice President of Multinational, Bowman played a central role in developing and expanding BHSI’s multinational network and capabilities. Her efforts have contributed significantly to BHSI’s presence in 178 countries worldwide.

Hilary Browne, Deputy Global Chief Underwriting Officer at BHSI, emphasized Bowman’s instrumental role in building a robust global network aligned with BHSI’s commitment to excellence. Browne stated, “Amy played a pivotal role in building our strong global network with likeminded partners who share our commitment to excellence. She is the perfect individual to lead our multinational business, and our multinational team, to the next level.”

Bowman’s promotion underscores BHSI’s commitment to nurturing talent from within its ranks and recognizing individuals who demonstrate exceptional leadership and industry expertise. Her extensive experience and track record of success position her well to lead BHSI’s multinational business into the future.

Bowman remains based in Boston, reflecting BHSI’s global reach and decentralized operational model. Her leadership will undoubtedly continue to drive growth and innovation within BHSI’s multinational division, further solidifying its position as a leading provider of insurance solutions on the global stage.

© 2024 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.

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Lessons From Warren Buffett

Lessons From Warren Buffett: Time Is a Powerful Force in Investing

In the world of investing, time isn’t just a measure of duration—it’s a powerful force that can shape the outcome of your investments. This concept is succinctly captured by Warren Buffett, the legendary investor, who views time as both a friend and a foe in the realm of business.

Buffett famously remarked at the 1998 Berkshire Hathaway Annual Meeting that “Time is the enemy of the poor business, and it’s the friend of the great business.” This statement encapsulates the essence of how time interacts with investments and businesses.

For investors, the passage of time directly impacts the rate of return on their investments. The longer an investment is held, the more opportunity there is for it to grow and compound. Time can magnify the gains of a well-performing investment, but it can also erode the returns of a poorly performing one. In this sense, time becomes a critical factor in the decision-making process for investors, influencing their strategies and choices.

Moreover, Buffett’s insight extends beyond the realm of investing to the businesses themselves. He emphasizes the importance of sustained profitability over time. Businesses that consistently generate high returns on equity are positioned to benefit from the passage of time—they become stronger and more valuable as they continue to deliver strong performance. On the other hand, businesses with low returns on equity face the risk of stagnation or decline over time. Time becomes their enemy, exposing weaknesses and hindering growth potential.

Buffett’s philosophy underscores the long-term perspective inherent in successful investing. He advocates for selecting investments with the intention of holding them for extended periods, allowing time to work its magic in unlocking their full potential. By focusing on businesses with solid fundamentals and strong track records, investors can harness the power of time to their advantage.

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© 2024 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.

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Berkshire Hathaway Energy

WEIM Generates Millions in Benefits for Berkshire’s Utilities Amidst Winter Challenges

(BRK.A), (BRK.B)

The Western Energy Imbalance Market (WEIM), which includes two Berkshire Hathaway utilities, continues to prove its worth, with cumulative benefits reaching an impressive $5.49 billion in the first quarter of 2024. Notably, its role in ensuring regional coordination became evident during a January cold snap that tested the Northwest’s grid reliability.

With 22 participants onboard, the WEIM yielded $436 million in benefits during this quarter alone, providing substantial relief on expenses for utilities and their customers. NV Energy and PacifiCorp, both subsidiaries of Berkshire Hathaway Energy, reaped significant rewards. NV Energy accrued $32.77 million, while PacifiCorp secured $73.83 million, further underlining the tangible advantages of active participation in the WEIM.

Its ability to efficiently transfer power across a vast and diverse landscape played a crucial role in meeting the heightened demand during the extreme cold spell from January 13-15, particularly in the Pacific Northwest. During this period, energy transfers from California and the Southwest proved invaluable, offering much-needed support to areas under strain due to increased electricity demand.

Established in 2014, the WEIM operates as a real-time electricity market, facilitating the buying and selling of power close to the time of generation and consumption. Powered by cutting-edge technology, the market excels in identifying and delivering the lowest-cost resources to meet immediate power needs while effectively managing congestion on transmission lines to uphold grid reliability.

© 2024 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.

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Brooks

Brooks Running Achieves Record Revenue in Q1 2024, Driven by Global Growth and Innovation

(BRK.A), (BRK.B)

Berkshire Hathaway’s Brooks Running, a leading performance running brand, has reported exceptional performance in the first quarter of 2024, marking a significant milestone in its history. With a remarkable 9% year-over-year increase in revenue, Brooks has achieved its highest quarterly results to date, propelled by its steadfast execution of a multichannel strategy and a robust pipeline of innovative products.

The brand’s global e-commerce segment has been a key driver of growth, surging by 22% compared to Q1 2023, with an impressive 38% year-over-year growth in March alone. This uptick underscores Brooks’ ability to meet the evolving demands of consumers in the digital space while maintaining healthy inventory levels.

In North America, Brooks has sustained its momentum with a 13% increase in sales relative to Q1 2023. Securing the No. 1 position in the adult performance running footwear market for the ninth consecutive quarter at U.S. national retail, Brooks has reaffirmed its dominance in the region. Additionally, the brand reclaimed the top spot in the U.S. specialty footwear segment during Q1, further solidifying its market position.

Brooks’ success extends beyond North America, with significant growth observed in key global markets. In the Asia-Pacific and Latin America region, revenue surged notably, with Australia and China witnessing impressive year-over-year increases of 38% and 180%, respectively. Despite ongoing retail uncertainties in Europe, the Middle East, and Africa, Brooks’ e-commerce business in the region grew by 10% year over year, showcasing resilience and adaptability.

Dan Sheridan, CEO of Brooks, attributed the brand’s success to its unwavering commitment to a “runner-first” strategy and meticulous execution on a global scale. He emphasized Brooks’ dedication to understanding and fulfilling the needs of runners and active individuals, regardless of their engagement channel, as a key differentiator for the brand.

As Brooks continues to innovate and expand its reach, its performance in Q1 2024 reflects not only financial success but also a deep connection with its customer base and a relentless pursuit of excellence in the world of running.

© 2024 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.

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BYD

Berkshire Hathaway-Backed BYD’s EV Sales Robust in April

(BRK.A), (BRK.B)

BYD, the Chinese automaker backed by Berkshire Hathaway, has had robust new-energy vehicle sales for the month of April. The company reported selling a total of 313,245 New Energy Vehicles, encompassing both plug-in electric vehicles (EVs) and battery EVs. This figure marks a significant 49% increase compared to the same period last year.

BYD’s top-sellers were the Dynasty and Ocean, which sold a combined 297,864 vehicles. The company also stated that it exported 40,011 passenger vehicles in April.

© 2024 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.

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Financial Reports

Berkshire Hathaway’s Q1 2024 Operating Earnings Surge Compared to Q1 2023

(BRK.A), (BRK.B)

Berkshire Hathaway has reported impressive operating earnings for the first quarter of 2024, marking a significant increase compared to the same period in 2023. The company’s robust performance across various sectors underscores its resilience and strategic prowess.

In Q1 2024, Berkshire Hathaway’s operating earnings stood at $11.22 billion, a substantial rise from $8.065 billion recorded in Q1 2023. This growth can be attributed to solid performances in key segments:

1. Insurance-underwriting: The company saw a remarkable increase in earnings from insurance underwriting, with figures soaring from $911 million in Q1 2023 to $2.598 billion in Q1 2024.
2. Insurance-investment income: Another significant contributor to the earnings surge was insurance investment income, which rose to $2.598 billion from $1.969 billion in the previous year’s first quarter.
3. BNSF and Berkshire Hathaway Energy Company: Despite minor fluctuations, both BNSF and Berkshire Hathaway Energy Company contributed positively to the overall earnings, reflecting the company’s diversified portfolio.
4. Other controlled businesses: Earnings from other controlled businesses remained stable, totaling $3.088 billion in Q1 2024, compared to $3.065 billion in Q1 2023.
5. Non-controlled businesses: While there was a slight decrease in earnings from non-controlled businesses, Berkshire Hathaway’s overall performance remained strong, with earnings totaling $405 million in Q1 2024.
6. Other: The company reported positive earnings in the “Other” category, marking a notable turnaround from the previous year’s loss, with earnings reaching $673 million.

Berkshire Hathaway’s exceptional performance in the first quarter of 2024 reaffirms its position as a powerhouse in the corporate landscape. With solid growth across various sectors and a commitment to delivering value to shareholders, the company continues to thrive even in challenging economic environments. As investors look ahead, Berkshire Hathaway’s consistent track record of success positions it as a compelling choice for long-term investment.

© 2024 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.

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Financial Reports

Berkshire Hathaway Share Repurchases Continued in Q1

(BRK.A), (BRK.B)

Berkshire Hathaway continued its stock buybacks in the first quarter of 2024. Berkshire Hathaway, the renowned conglomerate led by Warren Buffett, reaffirmed its commitment to stock buybacks with its latest move repurchases. The company allocated a substantial $2.6 billion towards repurchasing shares of both Class A and Class B common stock.

As of March 31, 2024, Berkshire Hathaway had successfully acquired shares equivalent to 1,437,251 Class A shares. This strategic decision reflects the company’s confidence in its own value and a belief that investing in its own shares presents an attractive opportunity.

This buyback initiative not only demonstrates Berkshire Hathaway’s financial strength but also underscores management’s confidence in the company’s long-term prospects. By repurchasing its own shares, Berkshire Hathaway signals to investors that it views them as undervalued and expects favorable returns in the future.

The company’s proactive approach to capital allocation highlights its commitment to enhancing shareholder value.

Berkshire’s stock buyback initiative allows the company to purchase its Class A and Class B shares whenever Warren Buffett, Berkshire’s Chairman and CEO, deems the repurchase price to be below the company’s conservatively estimated intrinsic value. These repurchases can occur through open market transactions or privately negotiated deals.

Berkshire’s cash reserves has continued to grow, reaching just under $190 billion.

© 2024 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.

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Minority Stock Positions

Berkshire Hathaway Enters Strategic Agreement with DaVita to Maintain Ownership Balance

(BRK.A), (BRK.B)

Berkshire Hathaway has solidified its relationship with DaVita, a prominent global healthcare company specializing in kidney care. With Berkshire holding just under 40 percent ownership in DaVita, a strategic stock buyback agreement has been established to prevent Berkshire from attaining a majority stake in the company.

The Share Repurchase Agreement outlines the terms for maintaining ownership balance. Should Berkshire’s ownership reach at least 45.0% of DaVita’s common stock, the company will engage in quarterly repurchases to adjust Berkshire’s stake back to 45.0%. These repurchases will be executed at the volume-weighted average per share price paid by DaVita during the applicable period. Additionally, if Berkshire’s ownership surpasses 49.5%, immediate share repurchases will be triggered.

Furthermore, Berkshire has agreed to vote shares exceeding 40% in accordance with DaVita’s Board of Directors’ recommendations. This agreement supplements the existing standstill letter agreement between the two parties, ensuring alignment with DaVita’s governance structure.

DaVita’s presence extends across the United States and ten other countries, bolstering its stature in the healthcare sector. Berkshire’s substantial investment in DaVita, holding over 36 million shares as of December 31, 2023, underscores its confidence in the company’s growth prospects.

The investment has proven lucrative for Berkshire, as evidenced by DaVita’s recent stock surge to an all-time high. DaVita’s share buyback program has contributed to this success, allowing Berkshire to increase its stake without additional investment.

This strategic agreement highlights the collaborative approach between Berkshire Hathaway and DaVita, ensuring mutual benefit while maintaining a balanced ownership structure.

© 2024 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.

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Jazwares

Berkshire Hathaway Subsidiaries Join Forces for Sweet Collaboration

(BRK.A), (BRK.B)

Two beloved companies under the Berkshire Hathaway umbrella, Jazwares and See’s Candies, have teamed up for an exciting promotion set to debut this coming October. Jazwares, renowned for its innovative toys, and See’s Candies, an iconic Californian confectionery brand, are merging their expertise to offer fans a delightful gift set.

The collaboration features a charming ensemble inspired by Squishmallows, the immensely popular plush toy line. Fans can look forward to an eight-inch cuddly rendition of Emily the Bat, a beloved Squishmallows character. This adorable plush will be accompanied by a co-branded custom box of chocolates and candies, all elegantly packaged in a one-of-a-kind tote bag. This exclusive set promises to be a treat for both toy enthusiasts and confectionery aficionados alike.

“Partnering with See’s Candies is the perfect way to further introduce Squishmallows into the consumables space,” remarked Gerhard Runken, Executive Vice President of Brand & Marketing at Jazwares. “This will be the perfect Halloween treat for fans of both brands, and we’re eager to add this unique collaboration to our robust lineup of iconic Squishmallows products!”

Pat Egan, President & CEO of See’s Candies, echoed the sentiment, emphasizing the joy this collaboration will bring to fans. “At See’s, we’re in the business of bringing joy, and that is exactly what this collaboration with Jazwares will do for fans of both brands. The ever-popular Squishmallows combined with our iconic, delicious chocolates will be the perfect treat this October.”

Squishmallows has established itself as a leading toy property in the U.S., with over 400 million plush sold worldwide and a devoted multi-generational fanbase. Its immense popularity extends to social media, particularly among Gen Z users, with billions of video views on platforms like TikTok and Instagram. The brand’s expansion into various lifestyle categories, including beauty, games, and apparel, underscores its status as a cultural phenomenon.

© 2024 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