2 hours 11 minutes ago – DJNF
By Anupreeta Das
“Berkshire Hathaway released preliminary first-quarter earnings as the firm’s annual shareholders meeting got under way in Omaha, Neb., on Saturday.
The firm, run by investor Warren Buffett, reported net income of $5.59 billion, up from $5.16 billion in the same period a year earlier.
Insurance underwriting profits declined to $1.132 billion in the quarter, compared with $1.355 billion in the prior-year quarter, because of a rise in natural disasters.
Berkshire’s massive railroad, utility and energy segment saw profits fall as well — to $1.225 billion, compared with $1.466 billion in the year prior.
First-quarter earnings at Berkshire’s BNSF Railway were down “significantly,” Mr. Buffett said at the annual meeting, adding that it is “almost certainly going to be down” for the remainder of the year. Lower shipments of coal and material used in shale-gas extraction had cut into the railroad’s results last year, and it has been expected to report lower earnings and revenue in 2016.
As a result, operating profit at Berkshire dropped in the quarter. The rise in net income was due to investment and derivative gains and losses, something that Mr. Buffett says are best to ignore.”
During the Berkshire Hathaway annual shareholder’s meeting, when talking about patterns in a company and in the market, Mr. Buffet stated he watched the Senate hearings on Valeant and that we should too. Mr. Charlie Munger added “Valeant of course, was a sewer, and they deserved what they got.”
When asked if they had the chance what would they change if they could go back, Mr. Munger said “At 92, I still have a lot of ignorance to work on.”
These gentlemen are honorable and impressive with their knowledge. People come from all over the world and stand in line from 3:00 a.m. in the morning so they may listen and be a part of the annual shareholder’s meeting when the doors open.
I personally am a big fan of Mr. Buffet. He has given us many quotes to live by. “Do not save what is left after spending, but spend what is left after saving.” I definitely do not have his billions to invest, but I understand the concept of “Be fearful when others are greedy and greedy when others are fearful.” In 2008 when the market crashed and Mr. Buffet seized the opportunity to invest $25b into blue chip companies, I thought he was a bit too bullish. But six years later, he profited over $10b on that bullish move.
I’m not advocating one to take their life savings and lose the house by investing in a downturn, but if there is a company that you have been monitoring and waiting for an opportunity to get in; this might be your chance. Just be careful out there.
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