Latest news with #Allen&CompanySunValleyConference
Newsweek
5 days ago
- Business
- Newsweek
Warren Buffett May Soon Reveal Mysterious New Investment
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. Berkshire Hathaway, the conglomerate led by Warren Buffett, is soon expected to reveal the mystery stock into which his company has reportedly made a significant investment. This holding could be valued at close to $5 billion, according to Barron's analysis of the company's first- and second-quarter filings. Why It Matters Buffett is perhaps the world's most widely revered investor, given the staggering and market-beating returns Berkshire Hathaway has delivered during his six-decade tenure as the conglomerate's chief. As chairman and CEO, Buffett transformed the textile firm into a diversified investment powerhouse with a market cap of $1 trillion. Major holdings accrued by Berkshire are therefore monitored closely, as these give an insight into the investment strategies of one of the most respected minds in finance. A disclosure of a new stake can grab the attention of investors, who often view Buffett's faith in a company as indicative of its underlying value. What To Know Berkshire Hathaway is expected to submit its 13-F report after the closing bell on Thursday. These reports—containing details of a company's equity holdings—are submitted to the U.S. Securities and Exchange Commission typically 45 days after the end of the most recent calendar quarter (June 30), and are one of the few ways the public and fellow investors are able to gain insight into the portfolios and strategies of companies such as Buffett's. In its quarterly filings, the company discloses its five major holdings— American Express Company, Apple Inc., Bank of America Corporation, The Coca-Cola Company and Chevron Corporation—as well as other major investments. Smaller investments, meanwhile, are divided into three broad categories: Banks, insurance and finance; Consumer products; Commercial, industrial and other. As Barron's reports, the cost basis—original asset value—of the third category rose by $2 billion in the first quarter and $2.8 billion in the second quarter, suggesting that Berkshire's could have purchased up to $4.8 billion of the mystery stock or stocks. Warren Buffett, Chairman and CEO of Berkshire Hathaway, makes his way to a morning session at the Allen & Company Sun Valley Conference on July 13, 2023 in Sun Valley, Idaho. Warren Buffett, Chairman and CEO of Berkshire Hathaway, makes his way to a morning session at the Allen & Company Sun Valley Conference on July 13, 2023 in Sun Valley, outlet noted that Berkshire requested confidential treatment for at least one stock purchased during the first quarter, and that it could do so in the upcoming 13-F, meaning this could remain a mystery for a while longer. The last time Berkshire requested confidentiality treatment—which withholds information from the public and allows institutional investors to build positions without tipping off the market and triggering copycat trades—was in late 2023. Berkshire was able to secretly build up a significant position in the insurance giant Chubb, having been granted permission to delay this disclosure until May 2024, at which point its stake was worth $6.7 billion. When Berkshire's holding in Chubb was finally revealed, the stock rose over 4 percent and reached what was then a record high, according to the Wall Street Journal. What People Are Saying Financial and investing advice firm The Motley Fool wrote in June: "The reason a fund manager would request [confidential treatment] is because investors would pile in and drive up the share price if the position were publicly revealed. If a high-profile money manager with a sizable Wall Street following can quietly build up their stake in a public company, they can likely do so at an advantageous price." It added that there were 54 potential candidates for the mystery stock, including UPS, FedEx and Caterpillar. What Happens Next? As Barron's noted, investors may have to wait until mid-November, when the company files its 13-F for the third quarter, to discover the provenance of the mystery stocks. Buffett is set to step down from his role as Berkshire's CEO at the end of the year, and announced in May that he will be handing the reins over to Greg Abel, vice chair of non-insurance operations.
Business Mayor
11-05-2025
- Business
- Business Mayor
Affirm shares drop 13% on weak forecast, concerns over CEO's bet on 0% loans
Max Levchin, co-founder of PayPal and chief executive officer of financial technology company Affirm, arrives at the Sun Valley Resort for the annual Allen & Company Sun Valley Conference, in Sun Valley, Idaho. Drew Angerer | Getty Images Affirm shares plunged on Friday after the fintech company issued a weak forecast, and investors questioned CEO Max Levchin's plan to go big in 0% loans. The buy now, pay later lender said revenue this quarter will be between $815 million and $845 million. The midpoint of the range was short of the $841 million average analyst estimate, according to LSEG. Levchin, who founded the company in 2012, is trying to bolster growth with 0% loans, a strategy he says gets consumers in the door and potentially turns them into long-time customers. Levchin told CNBC's 'Squawk Box' that it's a way to build customer loyalty, even if it means sacrificing margins today. 'We are helping people understand that not paying interest, revolving interest, excessively is a good thing,' he said. 'We're taking share from credit cards.' Those loans now make up 13% of Affirm's total Gross Merchandise Volume (GMV), with 80% coming from prime and super-prime customers. Affirm's core business involves issuing point-of-sale installment loans to consumers buying items like apparel, electronics and sporting goods. While GMV topped analysts' estimates, Affirm's revenue less transaction costs (RLTC) missed the Street's expectations, in part due to the surge in 0% APR loans. For the quarter, the company beat on earnings and delivered revenue that was inline with estimates. Analysts at Citizens maintained their market outperform rating on the stock, but noted in a report that the increase in 0% loans 'led to a lower take rate and RLTC margin than most forecasts.' And analysts at BTIG, who have a buy rating on the stock, wrote that 'Affirm shares are down precisely because the RLTC/take-rate weakness wasn't offset by more rapid GMV growth.' Levchin said that despite economic uncertainty, consumers are continuing to spend and that Affirm's credit performance remains 'solid' and 'consistent.' 'People are stressed out about the economy, yet they're shopping, they're buying, and they're paying their bills — at least they're paying their bills back to us on time,' he said. With Friday's slide, Affirm shares are down about 22% for the year, while the Nasdaq is off about 7%. Some analysts remain bullish. Susquehanna, Bank of America , and TD Cowen all upgraded the stock or raised price targets due to what they see as growth potential. Goldman Sachs maintained a buy rating on Affirm, calling it a 'strong category leader in BNPL and a share gainer vs. legacy credit providers.' Barclays , which has the equivalent of a buy rating, called the quarter a 'solid print' despite high investor expectations. The firm cautioned that the stock could see short-term underperformance, but is bullish on new partnerships, like a recent agreement with Costco. Levchin emphasized the importance of playing the long game. 'It took consumers and merchants and sort of the universe about a decade to figure out what we are and just how different and important what we have found to work really is,' he told CNBC. WATCH: Affirm Holdings falls more than 10% despite surprise beat READ SOURCE
