Latest news with #Omaha-based
CNBC
2 days ago
- Business
- CNBC
Berkshire Hathaway hikes Sirius XM stake to 37% after a sell-off on weak earnings
Warren Buffett's Berkshire Hathaway once again scooped up shares of Sirius XM , hiking its stake in satellite radio company to about 37% of shares outstanding, after a sell-off on disappointing earnings. The Omaha-based conglomerate bought 5 million shares of Sirius XM via separate transactions on Thursday, Friday and Monday, according to a regulatory filing released Monday evening. Berkshire now owns 124.8 million shares, worth about $2.6 billion. Berkshire first invested in Sirius XM after billionaire John Malone's Liberty Media completed its deal in 2024 to combine its tracking stocks with the rest of the audio entertainment company. It was part of Malone's reshuffling of his sprawling media empire that also included a split-off of the Atlanta Braves baseball team into a separate, publicly traded company — which Berkshire also owns shares in. SIRI YTD mountain Sirius XM year to date The 94-year-old Buffett has never mentioned the investment publicly, and it's unclear if he's behind it or if it's the work of the billionaire's investing lieutenants — either Ted Weschler or Todd Combs. The latest purchase came after Siri's second-quarter earnings report on Thursday. The stock dropped nearly 8% that day after the company's quarterly profit declined more than expected. Siri also warned about continuous weakness in the advertising market amid the economic uncertainty. "2025 continues to be a transition year, though we believe management continues to execute well, and we don't see a meaningful shift in fundamentals," Evercore ISI analysts said in a note to clients Friday. Shares of Siri are down 4% this year after a 58% loss in 2024.
CNBC
3 days ago
- Business
- CNBC
What Wall Street analysts are saying about Berkshire's mixed earnings and rare Kraft Heinz write-down
Berkshire Hathaway 's second-quarter earnings report had a few surprising elements that caused shares to fall Monday, but few Wall Street analysts are abandoning Warren Buffett's conglomerate. Berkshire's operating profit from the company's wholly-owned businesses, including insurance and railroads, dipped 4% year-over-year, to $11.16 billion in the second quarter. The Omaha-based conglomerate again issued a stern warning of the effect of President Donald Trump's tariffs and the potential impact on its various businesses. Kraft Heinz write-down Most notably, Berkshire took a rare write-down of its underperforming Kraft Heinz stake. The conglomerate for the first time reduced the carrying value of its 27% position by $3.8 billion. The move came as reports emerged in trade journals and elsewhere that the Jello and Oscar Mayer hot dog maker has been eyeing a spinoff of its grocery business . Two Berkshire executives resigned as directors from Kraft Heinz's board in May. "On May 20, 2025, Kraft Heinz announced that it was evaluating potential strategic transactions to enhance shareholder value ... Given these factors, as well as prevailing economic and other uncertainties, we concluded that the unrealized loss, represented by the difference between the carrying value of our investment and its fair value, was other-than-temporary," Berkshire said in the earnings report released Saturday. Kraft Heinz has been a laggard for Berkshire. Since its peak of $62 in 2015, Kraft Heinz shares have been cut by more than half and currently trade near $27 apiece. "We would expect a modestly negative reaction to the Kraft Heinz charge," UBS's analyst Brian Meredith said in a research note. In 2019, Buffett told CNBC his conglomerate paid too much for Kraft, noting he might have misjudged certain aspects of the company. "I was wrong in a couple of ways about Kraft Heinz," Buffett tells CNBC. "We overpaid for Kraft." Buffett said he did not overpay for Heinz, however. In 2013, Buffett teamed up with Brazilian private equity company 3G Capital to acquire Heinz. The billionaire later worked with 3G to help finance Heinz's $49 billion merger with Kraft Foods Group in 2015. No buybacks Berkshire is still not buying back its own stock, and the conglomerate didn't repurchase any stock in the first half of 2025, through July 21. Many had speculated that Berkshire might have started repurchasing shares amid a sizable correction in the stock. Berkshire shares have fallen about 15% from their all-time high in early May, right before the 94-year-old Buffett announced that Greg Abel is taking over as CEO at the end of 2025. BRK.A YTD mountain Berkshire Hathaway Class A shares year to date "While we believe Mr. Abel will build credibility with investors over time, we think near-term catalysts for BRK are increased investment activity, a potential large acquisition and share repurchases," Kyle Sanders, analyst at Edward Jones, said in a note. "None of those happened this quarter, which we view as somewhat disappointing." Buffett's cash hoard of $344.1 billion remained near a record high. Berkshire was a net seller of stocks for the 11th quarter in a row, dumping $4.5 billion in equities in the first six months of 2025. Strong Geico and BNSF results While operating earnings dipped from last year's level, analysts cheered better-than-expected results at BNSF, the former Burlington Northern Santa Fe railroad, and continued strong results at auto insurer Geico. Pre-tax underwriting earnings at Geico rose slightly, to $1.8 billion, in the second quarter, while BNSF's operating earnings jumped nearly 20% to $1.5 billion. "Geico continues to grow and remains very profitable," Meredith at UBS said. "BNSF beat our expectations on better-than-expected operating margins at 35.2% (vs. UBSe at 33.0%) with lower fuel costs. The unit volume was also above our expectations." Keefe Bruyette & Woods analyst Meyer Shields hiked his 12-month price target on Berkshire to $740,000 from $735,000, representing 7% upside where the stock was trading early Monday, at about $692,000. Berkshire's current valuation "fully reflects its earnings prospects and balance sheet strength amidst ongoing macro uncertainty and the emerging management succession risk (which will probably impact investors' view of Berkshire more than it will actual operations) in Mr. Buffett's recently announced retirement plans," Shields said.
CNBC
3 days ago
- Business
- CNBC
Berkshire shares dip after earnings decline, lack of buybacks disappoint investors
Berkshire Hathaway shares dipped after Warren Buffett's conglomerate reported a small decline in operating earnings, while continuing a stock-selling spree and a buyback halt. The Omaha-based giant saw operating earnings including those from its insurance and railroad businesses decline dip 4% year over year to $11.16 billion in the second quarter. While railroad, energy, manufacturing, service and retailing all reported higher profits from a year ago, a drop in insurance underwriting dragged down overall results. Class A and B shares of Berkshire both declined about 1% in premarket trading Monday following the results. The stock has fallen about 12% from its all-time high in early May right before the 94-year-old Buffett announced that Greg Abel is taking over as CEO at the end of 2025. A move that caught many by surprise was a big write-down for Berkshire's underperforming Kraft Heinz stake. The conglomerate for the first time recorded a loss of $3.8 billion from its 27% Kraft Heinz stake. The move came as reports emerged that the consumer goods giant has been eyeing a spinoff of its grocery business. Two Berkshire executives resigned as directors from Kraft Heinz's board in May. "The investment had been carried on Berkshire's books for more than its market value for some time," said Bill Stone, CIO of The Glenview Trust Company and a Berkshire shareholder. "Buffett has long acknowledged that he paid too much for Kraft Heinz, especially in light of the increased competition in the branded food category." Buffett's cash hoard of $344.1 billion remained near a record high. Berkshire was a net seller of stocks for a 11th quarter in a row, dumping $4.5 billion in equities in the first six months of 2025. The conglomerate also didn't repurchase any stock in the first half of 2025 and through July 21 even as shares suffered a sizable correction. "While we believe Mr. Abel will build credibility with investors over time, we think near-term catalysts for BRK are increased investment activity, a potential large acquisition, and share repurchases," Kyle Sanders, analyst at Edward Jones, said in a note. "None of those happened this quarter, which we view as somewhat disappointing."
CNBC
5 days ago
- Business
- CNBC
Berkshire Hathaway operating earnings dip 4% as conglomerate braces for tariff impact
Berkshire Hathaway on Saturday reported a small decline in second-quarter operating earnings as Warren Buffett's conglomerate warns of negative impacts from steep U.S. tariffs. Berkshire's operating profit — those from the company's wholly owned businesses including insurance and railroads — dipped 4% year over year to $11.16 billion in the second quarter. The results were impacted by a decline in insurance underwriting, while railroad, energy, manufacturing, service and retailing all saw higher profits from a year ago. The Omaha-based conglomerate once again issued a stern warning of President Donald Trump's tariffs and the potential impact on its various businesses. "The pace of changes in these events, including tensions from developing international trade policies and tariffs, accelerated through the first six months of 2025," Berkshire said in its earnings report. "Considerable uncertainty remains as to the ultimate outcome of these events." "It is reasonably possible there could be adverse consequences on most, if not all, of our operating businesses, as well as on our investments in equity securities, which could significantly affect our future results," it said. Buffett's cash hoard fell slightly to $344.1 billion, from the $347 billion level at the end of March. The conglomerate didn't repurchase any stock in the first half of 2025 even as shares declined more than 10% from a record high. In May, the 94-year-old "Oracle of Omaha" announced that he's stepping down as CEO at the end of 2025 after experiencing the physical effects of aging. Greg Abel, Berkshire's vice-chairman of non-insurance operations, is set to take over as CEO, while Buffett will remain as chairman of Berkshire's board.
Business Insider
27-07-2025
- Business
- Business Insider
These 11 companies have left California over the years
McKesson Corp. Pharmaceutical giant McKesson left California in 2019. In terms of public companies, only Apple loomed larger in the Bay Area. Then-CEO John H. Hammergren said that McKesson was moving its headquarters to Las Colinas, Texas (near Dallas) to "improve efficiency, collaboration and cost-competitiveness, while providing an exceptional work environment for our employees." Chevron Oil giant Chevron had deep roots in California, going back to the 1870s when an early predecessor discovered oil north of Los Angeles. That didn't stop the company from moving to Houston in 2024. Looking back on its move, the energy giant says that California's leaders have taken steps that made it "unappealing." "While our relocation has very real benefits to our business, we also believe California policymakers have pursued policies that raise costs and consumer prices, creating a hardship for all Californians, especially those who can least afford it," Ross Allen, a spokesperson for Chevron, said in a statement to Business Insider. "These policies have also made California investment unappealing compared with opportunities elsewhere in the US and globally." Tesla Like some of his fellow tech CEOs, Elon Musk grew frustrated with the limitations of the Bay area before Tesla left for Austin in 2021. "There's a limit to how big you can scale in the Bay Area," Musk said at the time. Before the move, Musk had also clashed with officials over keeping Tesla's Fremont, California, factory open despite COVID-19 orders. Oracle In 2020, Oracle left its longtime home in California. The computer technology giant isn't done moving yet. Last year, CEO Larry Ellison said the computer technology giant would move its headquarters from Austin, where it had been for less than half a decade, to Tennessee. "Nashville is a fabulous place to live," Ellison said, according to an Associated Press report. "It's a great place to raise a family. It's got a unique and vibrant culture .... It's the center of the industry we're most concerned about, which is the health care industry." CBRE Global real estate company CBRE monitors the number of companies leaving California. The firm itself left Los Angeles in 2020. "Designating Dallas as CBRE's global corporate headquarters formalizes how our company has been operating for the past eight years," Lew Horne, head of operations in the Southwest, said in a statement to the Los Angeles Times in 2020. Charles Schwab Charles Schwab left for Westlake, Texas, in 2019 after it agreed to buy Omaha-based TD Ameritrade. Schwab chairman and founder Charles Schwab singled out the business climate in California as motivation for the move: "The costs of doing business here are so much higher than some other place" he told Forbes. The companies said in a joint statement that their new home would "allow the combined firm to take advantage of the central location of the new Schwab campus." In 2023, SFGate reported that Schwab further reduced its presence in San Francisco, its former home. "We've had an extremely positive experience in Texas," a spokesperson from Schwab said in a statement to BI. "From day one, the energy, innovation, and welcoming spirit of North Texas has far exceeded our expectations." Hewlett Packard Enterprise (HPE) In 2020, Hewlett Packard Enterprise announced it was leaving California, another COVID-19 era departure. "Houston is also an attractive market for us to recruit and retain talent, and a great place to do business," CEO Antonio Neri said in a statement announcing the move. Neri praised HPE's new home in Spring, Texas (a Houston suburb), but stressed that the company was not leaving Silicon Valley entirely. "Our San Jose campus will remain a hub for technological talent and innovation," he said. Palantir Software giant Palantir left Silicon Valley in 2020. Before the tech company moved, CEO Alex Karp said he had concerns about California. "I'm pretty happy outside the monoculture in New Hampshire," Karp told Axios in May 2020 when asked if he would move back to California as the COVID-19 pandemic was receding. Karp said at the time that Palantir was narrowing down its list of future homes, which potentially included Colorado. Palantir has been in Denver since August 2020. SpaceX Elon Musk promised to move SpaceX to Texas in 2024, part of a series of announcements that positioned his companies away from California. In announcing SpaceX's relocation, Musk singled out a California law that forbids schools from requiring staff to inform parents of a student's gender identity. "This is the final straw," Musk wrote on X in July 2024. "Because of this law and the many others that preceded it, attacking both families and companies, SpaceX will now move its HQ from Hawthorne, California, to Starbase, Texas." AECOM Global consultancy firm AECOM left Los Angeles in 2021, saying that Texas offered more benefits. "Dallas has emerged as a US hub for corporate headquarters and a compelling corporate talent magnet, particularly among our peers and public companies in the engineering and consulting sectors," a company spokesperson told The LA Times. FICO Financial data analytics firm FICO, officially known as the Fair Isaac Corporation, quietly moved to Bozeman, Montana, sometime in 2021. The company, best known for its FICO score, previously moved its corporate headquarters from Minneapolis to San Jose in 2013.
