Buffett buys back Berkshire: Morning Brief

Berkshire Hathaway’s own shares were Berkshire’s big buy in the second quarter.

Yahoo Finance’s Editor-in-Chief Andy Serwer and Myles Udland discuss Berkshire Hathaway in Q2 results.

Berkshire Hathaway (BRK-A, BRK-B) released its quarterly results on Saturday morning.

Total revenue for the conglomerate hit $69.1 billion in the second quarter while earnings per share came in at $18,488 per Class A share.

But as has been the case for several years now, one of the biggest headlines to emerge from Berkshire’s results is the growing cash pile Warren Buffett’s company is sitting on. At the end of the quarter, Berkshire’s insurance and other businesses held cash, cash equivalents and Treasury Bills worth $140.7 billion. This is up from $138.1 billion at the end of the first quarter.

The primary use of Berkshire’s cash in recent years been to purchase equity securities and, specifically, repurchase shares of Berkshire Hathaway.

In the second quarter, the company spent $6 billion buying back its own stock after spending $6.6 billion on repurchases in the first quarter. As Bloomberg’s Katherine Chiglinsky notes, this most recent repurchase is the 4th-largest since Berkshire embarked on repurchases of its stock in 2018, after taking almost six years off from the practice.

In his most recent annual letter to Berkshire Hathaway shareholders, Buffett talked at length about share buybacks and the benefits this practice can confer on shareholders, using Berkshire’s stake in Apple (AAPL) and Apple’s own repurchase plan as an illustration of this dynamic.

“The math of repurchases grinds away slowly, but can be powerful over time,” Buffett wrote. “The process offers a simple way for investors to own an ever-expanding portion of exceptional businesses. And as a sultry Mae West assured us: ‘Too much of a good thing can be … wonderful.'”

For more on this article by Myles Udland please visit:
https://finance.yahoo.com/news/buffett-buys-back-berkshire-morning-brief-090337744.html

Watch the 2021 Berkshire Hathaway Annual Shareholders Meeting on YouTube:

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