THU, MAR 28, 2024

WARREN BUFFETT WATCH

Berkshire shares end first quarter at record highs

With the U.S. stock markets closed tomorrow for Good Friday, today's trading marks the end of the year's first quarter.

Both classes of Berkshire Hathaway have posted solid gains over the past three months and closed today at record highs.

The Class A shares ended at $634,440, a gain of almost 17% since the beginning of the year.

The widely held Class B shares did even better with an increase of almost 18% year-to-date.

Neither the A nor the B shares, however, set new intraday highs today.

Berkshire's market value is now above $900 billion amid speculation it could be the next company join the exclusive $1 trillion club.

The U.S. stock market, as represented by S&P 500 index, also ended the quarter with a record high and its 10.2% advance makes it the benchmark's strongest first quarter since 2019.

Both Berkshire classes, however, significantly outperformed the index.

Berkshire adds to Sirius XM bet as potential exchange profit erodes

Berkshire made a small addition to its Sirius XM tracking stock bet late last week and early this week, bringing the value of its stakes in LSXMA and LSXMK to $2.6 billion.

According to SEC filings Tuesday, it spent a total of $73.7 million for almost 2.6 million shares on Thursday, March 21 through Monday, March 25, paying an average of $28.83 per share.

Berkshire purchased $469 million of the tracking stocks in March, nearly two-thirds of the $736 million it has spent this year adding to those positions.

Over that time, however, the potential return of Liberty Media's planned exchange of the tracking stocks for shares of Sirius XM Holdings (SIRI) has been eroding.

As part of a move Liberty Media announced last December to simplify the ownership structure of the satellite radio company SiriusXM, each tracking stock share will be exchanged for approximately 8.4 SIRI shares when the deal closes. That's expected to happen in the third quarter, although Barron's notes some analysts think it could get done sooner.

Since the beginning of the year, the tracking stocks are up around 3.3%, but SIRI shares have dropped 29%.

That's reduced the potential return from the exchange from well over 50% three months ago to just below 10% now.

Based on its most recently reported holdings, that would generate a paper profit of $254 million for Berkshire.

File photos: Liberty Media CEO Greg Maffei in 2015 (Reuters | Mike Blake), Berkshire Hathaway Portfolio Manager Ted Weschler in 2022 (Reuters | Scott Morgan)

Barron's says "some Berkshire watchers" think the Liberty Sirius XM position is being handled by portfolio manager Ted Weschler, who "is believed to have a good relationship" with Liberty Media CEO Greg Maffei.

While it is possible Berkshire is building its tracking stock position because it is optimistic about the future of satellite radio, Barron's believes it is more interested in the upcoming exchange.

BUFFETT AROUND THE INTERNET

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CNN Business: BYD’s profit soared 80% in the year the Chinese EV giant overtook Tesla

Financial Times (subscription): BYD misses profit forecasts as Huawei challenge emerges

HIGHLIGHTS FROM THE ARCHIVE

How Buffett can make an investment decision 'in five minutes' (2008)

When Warren Buffett and Charlie Munger got an investment opportunity pitched to them, they were able to decide “in five minutes” whether or not to take it. Buffett describes how they quickly evaluated opportunities.

BERKSHIRE STOCK WATCH

Four weeks

Twelve months

BERKSHIRE'S TOP U.S. STOCK HOLDINGS - Mar. 28, 2024

Berkshire's top holdings of disclosed publicly-traded stocks in the U.S., Japan, and Hong Kong, by market value, based on today's closing prices.

Holdings are as of September 30, 2023 as reported in Berkshire Hathaway’s 13F filing on November 14, 2023, except for:

Mitsubishi and Mitsui, which are as of June 12, 2023. Tokyo Stock Exchange prices are converted to U.S. dollars from Japanese yen.
Occidental Petroleum, which is as of February 5, 2024.

The full list of holdings and current market values is available from CNBC.com's Berkshire Hathaway Portfolio Tracker.

QUESTIONS OR COMMENTS

Please send any questions or comments about the newsletter to me at alex.crippen@nbcuni.com. (Sorry, but we don't forward questions or comments to Buffett himself.)

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Also, Buffett's annual letters to shareholders are highly-recommended reading. There are collected here on Berkshire's website.

-- Alex Crippen, Editor, Warren Buffett Watch

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