Warren Buffett buys more of his own shares as Berkshire profits rise

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Berkshire (BRKB) reported strong second-quarter earnings on Saturday. Global profits reached $ 28.1 billion in the second quarter, up 7% from the same period a year ago, and Berkshire’s net profit for the first half of 2021 reached $ 39.8 billion. dollars, offsetting a loss of $ 23.5 billion in the first six months of 2020.

Operating profits, a measure Buffett and many analysts and investors prefer to view as a true measure of Berkshire’s health, also rebounded strongly. The company posted operating income of $ 6.7 billion in the second quarter, an increase of 21% from last year.

Berkshire has a huge pile of money which is growing further as Berkshire seeks more investment opportunities. The company had $ 144.1 billion on its balance sheet at the end of June, up from $ 138.3 billion in December.

Although Buffett is famous for his savvy investments in blue chip American companies like Apple (AAPL), Coke (KO) and American Express (AXP), Berkshire recently splurged on its own stock.

The company revealed on Saturday that it bought back $ 6 billion of its shares in the second quarter. It has now repurchased $ 12.6 billion of Berkshire shares so far this year.

It’s been a good investment lately. Shares of Berkshire’s more affordable B-shares, which trade at around $ 285 and are part of the S&P 500, have risen 23% this year, outperforming the broader market.
From the company Sharing (BRKA), which do not divide, are trading at around $ 430,000 a piece.

Still, Buffett has long talked about wanting to make another “elephant-sized” acquisition to expand the company’s portfolio of assets. But make no mistake: Berkshire does very well with what it already has.

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Berkshire’s rail, utilities and energy companies were the big winners in the second quarter, posting a 28% jump in operating profits. Berkshire owns the Burlington Northern Santa Fe Railway and the utility companies PacifiCorp and MidAmerican Energy.

The company’s “other” business unit, which includes a variety of consumer businesses ranging from Dairy Queen and See’s Candies to Duracell batteries, Benjamin Moore paints and Fruit of the Loom underwear.

As a sign of how important these businesses are to Berkshire, the company announced in May that Greg Abel, Berkshire’s vice president in charge of the company’s non-insurance operations, will once succeed the soon-to-be 91-year-old Buffett. as CEO of Berkshire. he retires or dies.

Ajit Jain, another vice president of Berkshire, heads the company’s massive insurance unit, which includes home and auto insurance giant Geico.

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