Berkshire Hathaway discussed performance, share buying, climate change, and succession planning at annual meeting

From Morningstar: 2024-05-07 06:17:00

Berkshire Hathaway released its first-quarter earnings report on May 4, providing insights into Geico and BNSF’s performance, climate change impact, and stock sales during its annual meeting. Despite being a net seller of stocks, Berkshire increased share-buying activity while discussing succession planning and future capital allocation. Morningstar rates BRK.A 4 stars with a wide economic moat and low uncertainty. Berkshire’s undervalued stock is estimated at $427 per Class B share.

At the annual meeting lacking Charlie Munger, Warren Buffett addressed operations, investments, and succession planning with Ajit Jain and Greg Abel, highlighting challenges in Geico and BNSF, increasing share buying, and potential dividend rumors. Morningstar emphasizes the wide economic moat of Berkshire’s insurance operations, particularly Geico, a top auto insurer in the US.

Geico’s direct-selling strength has made it a significant player in the auto insurance market, generating substantial earned premiums for Berkshire. Despite competitive challenges in the insurance industry, Berkshire’s overcapitalized and underwriting-gain-generating insurance businesses provide significant contributions to the firm’s earnings and valuation. Considered moaty on their own, these operations yield low-cost float for Berkshire’s investment activities.



Read more at Morningstar: Is Berkshire Hathaway a Buy After Its Annual Meeting?