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Cash in Hand: Berkshire Hathaway AGM: Buffett Adopts a Proven Strategy in Times of Rising Inflation | news

Buffett speaks at the shareholders’ meeting on the impact of inflation
Berkshire Hathaway is investing more in times of rising inflation
Share buybacks fell in the first quarter

At Berkshire Hathaway’s annual shareholders’ meeting in Omaha last Saturday, Warren Buffett spoke again about the effects of inflation – he had already warned shareholders last year. “He cheats almost everyone,” Yahoo Finance echoes the Berkshire CEO. “If you could really have a rock solid monetary unit for the next hundred years, it would be better for companies and investors in general,” said the investor legend.

Rising Inflation – Berkshire Hathaway is investing even more

As Russia launched its war of aggression against Ukraine and US inflation skyrocketed, Warren Buffett followed a proven strategy and began investing more money after his investment holding’s liquidity position grew. notably in recent years.

So Buffett stocked up on Occidental Petroleum stock and increased his holdings in Chevron and Activision Blizzard, although Buffett spoke of “extraordinary” price increases in Berkshire Hathaway companies, according to Yahoo Finance. Berkshire’s Chevron holding, which was about $ 4.5 billion at the end of 2021, was about $ 25.9 billion at the end of March. According to Yahoo Finance, Activision Blizzard’s stake, which accounted for just 1.87% of the game company’s common stock, rose to 9.5% as Berkshire bet on the acquisition of Microsoft. In early April, it was announced that Buffett and his holding company had purchased a multi-billion dollar package of HP stock. The 121 million shares of HP were valued at around $ 4.2 billion based on the closing price at the time. Overall, Buffett’s investment vehicle made net share purchases of $ 41 billion in the first quarter, the highest in terms of data dating back to 2008, according to Yahoo Finance.

In March, Berkshire Hathaway also announced the acquisition of US insurance group Alleghany. However, the Alleghany acquisition is not expected to be completed until the fourth quarter and will cost Berkshire $ 11.6 billion.

Investor: Investing in Berkshire should do well in any environment

However, at Berkshire Hathaway’s annual shareholders’ meeting, Buffett was also confronted with questions as to why he hadn’t taken advantage of the recession caused by the crown pandemic. Buffett admitted, according to Yahoo Finance, that Berkshire Hathaway hasn’t always been good at timing asset purchases, but the investment holding has been pretty good at figuring out when it’s getting enough cash for its money. He also claimed that although he claimed to have seen price increases in his own companies, he could not predict the course of inflation over the next few months or years.

According to Yahoo Finance, Berkshire investor Darren Pollock, who works at Cheviot Value Management LLC, said: “As long as Buffett and his team pay reasonable prices for quality companies, these investments should be fine in any environment, inflationary or otherwise. “. They reflected, he said, “the huge volume of money flowing into Berkshire’s coffers, coupled with what we think is becoming a more obvious desire to get out of cash as inflation becomes more entrenched.”

Fewer share buybacks

However, Berkshire Hathaway’s share buybacks fell slightly in the first quarter, signaling they may not be as attractive to the company right now. After the investment holding spent $ 6.9 billion on stock repurchases in the fourth quarter of 2021, it was $ 3.2 billion in the first quarter, which with the other investments still contributed to the cash balance of $ 146. $ 7 billion to approximately $ 106 billion.

Financeen.net editorial staff

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