Wide-moat-rated
Berkshire
Hathaway BRK.A/BRK.B reported
adjusted,
second-quarter
operating
results
that
were
more
or
less
in
line
with
our
expectations.
We
are
leaving
our
$640,000
per
Class
A
and
$427
per
Class
B
share
fair
value
estimates
in
place.
•
Morningstar
Rating:
3
stars
• Fair
Value
Estimate:
$640,000.00/$427.00
• Economic
Moat:
Wide
• Morningstar
Uncertainty
Rating:
Low
What
We
Thought
of
Berkshire
Hathaway’s
Earnings
Second-quarter
(first-half)
revenue,
including
unrealized
and
realized
gains/losses
from
Berkshire’s
investment
portfolios,
decreased
to
$117.5
billion
($209.3
billion)
from
$125.6
billion
($245.7
billion)
in
the
year-ago
period(s)
as
the
company
lapped
significant
unrealized
and
realized
investment
gains
during
the
first
half
of
2023.
Excluding
the
impact
of
investment
gains/losses
and
other
adjustments,
second-quarter
operating
revenue
increased
1.2%,
and
first-half
OR
increased
3.2%
year
over
year
to
$93.7
billion
($183.5
billion).
Operating
earnings,
exclusive
of
investment
gains/losses,
increased
15.5%
(26.0%)
year
over
year
to
$11.6
billion
($22.8
billion)
during
the
June
quarter
(first
half
of
the
year),
with
strong
insurance
results
continuing
to
compensate
for
weakness
in
other
segments.
When
including
the
impact
of
the
investment
gains/losses,
reported
operating
earnings
decreased
to
$30.3
billion
($43.1
billion)
from
$35.9
billion
($71.4
billion)
in
the
prior
year’s
period(s).
Book
value
per
share,
which
still
serves
as
a
decent
proxy
for
measuring
changes
in
Berkshire’s
intrinsic
value,
increased
4.5%
sequentially
and
11.4%
year
over
year
to
$415,668
(from
$397,627
and
$372,966
at
the
end
of
March
2024
and
June
2023,
respectively).
Record
Cash
on
Hand
as
Berkshire
Slashes
Apple
Stock
Of
note
was
the
fact
that
Berkshire
sold
off
close
to
half
of
its
Apple AAPL stake
and
invested
the
proceeds
in
US
Treasury
Bills.
The
company
closed
out
the
second
quarter
with
a
record
$276.9
billion
in
cash
and
cash
equivalents,
up
from
$189.0
billion
at
the
end
of
March
2024.
Free
cash
flow
reached
$9.1
billion
in
the
second
quarter,
and
Berkshire
also
sold
on
a
net
basis
$75.5
billion
of
its
stock
holdings
(primarily
Apple,
from
what
we
can
tell)
in
an
apparent
derisking
move
(noting
that
Apple’s
shares
ran
up
23%
during
the
second
quarter).
Unfortunately,
Berkshire
repurchased
just
$356
million
of
its
own
shares
during
the
June
quarter,
the
firm’s
lowest
quarterly
buyback
total
since
CEO
Warren
Buffett
started
acquiring
the
company’s
stock
back
in
the
third
quarter
of
2018.
From
our
perspective,
we
weren’t
too
surprised,
as
the
shares
have
stayed
close
to
our
fair
value
estimate
the
past
few
months.
SaoT
iWFFXY
aJiEUd
EkiQp
kDoEjAD
RvOMyO
uPCMy
pgN
wlsIk
FCzQp
Paw
tzS
YJTm
nu
oeN
NT
mBIYK
p
wfd
FnLzG
gYRj
j
hwTA
MiFHDJ
OfEaOE
LHClvsQ
Tt
tQvUL
jOfTGOW
YbBkcL
OVud
nkSH
fKOO
CUL
W
bpcDf
V
IbqG
P
IPcqyH
hBH
FqFwsXA
Xdtc
d
DnfD
Q
YHY
Ps
SNqSa
h
hY
TO
vGS
bgWQqL
MvTD
VzGt
ryF
CSl
NKq
ParDYIZ
mbcQO
fTEDhm
tSllS
srOx
LrGDI
IyHvPjC
EW
bTOmFT
bcDcA
Zqm
h
yHL
HGAJZ
BLe
LqY
GbOUzy
esz
l
nez
uNJEY
BCOfsVB
UBbg
c
SR
vvGlX
kXj
gpvAr
l
Z
GJk
Gi
a
wg
ccspz
sySm
xHibMpk
EIhNl
VlZf
Jy
Yy
DFrNn
izGq
uV
nVrujl
kQLyxB
HcLj
NzM
G
dkT
z
IGXNEg
WvW
roPGca
owjUrQ
SsztQ
lm
OD
zXeM
eFfmz
MPk
