Warren Buffett is just like the rest of us. He got crushed by the plunge in the stock market during the first half of the year. But the Oracle of Omaha is undeterred by the wildness on Wall Street. Berkshire Hathaway is still buying and many of the the company’s diverse business lines are still thriving, even in these uncertain economic times.
Berkshire Hathaway reported Saturday that the massive conglomerate posted a net loss of nearly $44 billion in the second quarter, red ink that was due mostly to a big drop in the value of Berkshire’s significant stock portfolio.
Berkshire owns large stakes in Apple, Bank of America, Coca-Cola, Chevron and American Express. Those five stocks make up nearly 70% of the portfolio. Chevron and Coke have both rallied this year but tech stocks and financials have been significant market losers.
But the steep loss in the value of Berkshire’s portfolio is not the whole story. The firm actually reported an operating profit of $9.3 billion in the quarter, up nearly 40% from a year ago.
That gain was due in part to higher interest rates boosting portions of its colossal insurance unit. There were also jumps in earnings from Berkshire’s railroad, utility and energy businesses.
Berkshire owns Geico, Burlington Northern Santa Fe, PacifiCorp and MidAmerican Energy Company as well as big consumer brands such as Fruit of the Loom, Duracell, Dairy Queen and a large stake in Kraft Heinz.
Courtesy: CNN
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