{"id":3859,"date":"2023-05-07T04:03:42","date_gmt":"2023-05-07T09:03:42","guid":{"rendered":"https:\/\/embarrdowns.com\/berkshire-hathaways-investments-in-occidental-petroleum-and-apple-a-look-at-warren-buffetts-strategy\/"},"modified":"2023-05-07T04:03:42","modified_gmt":"2023-05-07T09:03:42","slug":"berkshire-hathaways-investments-in-occidental-petroleum-and-apple-a-look-at-warren-buffetts-strategy","status":"publish","type":"post","link":"https:\/\/embarrdowns.com\/berkshire-hathaways-investments-in-occidental-petroleum-and-apple-a-look-at-warren-buffetts-strategy\/","title":{"rendered":"Berkshire Hathaway’s Investments in Occidental Petroleum and Apple: A Look at Warren Buffett’s Strategy"},"content":{"rendered":"

Warren Buffett’s conglomerate, Berkshire Hathaway, has recently made headlines for its investments in Occidental Petroleum and Apple. Berkshire Hathaway now holds a roughly 22.1% stake in Occidental Petroleum, and has been bullish on Apple since 2016, with Apple stock currently representing nearly 40% of Berkshire Hathaway’s equity holdings. Despite this, Buffett has noted that saying Apple comprises this percentage of Berkshire’s overall investment portfolio is not an accurate understanding of the business.[0]<\/a><\/sup><\/p>\n

Berkshire Hathaway listed $997 billion in assets at the end of the first quarter, with only $328.16 billion of those being investments in equity securities.[0]<\/a><\/sup> The company has turned towards buybacks more often as valuations in public markets had made it more challenging for Buffett to identify promising acquisitions.[1]<\/a><\/sup> As long as valuations of the publicly traded and privately held companies Berkshire prefers to acquire or invest in remain inadequate, making acquisitions and stock investments becomes harder to enact and the company seems to be stuck with share repurchases as the primary option for working down cash balances.[2]<\/a><\/sup><\/p>\n

For a long time, Buffett has expressed his admiration for Apple’s CEO Tim Cook and the lasting appeal of the company’s offerings, such as the iPhone.[0]<\/a><\/sup> Despite not understanding devices like the iPhone, he understands consumer behavior and how loyal customers are to Apple.[3]<\/a><\/sup> According to Buffett, consumers are paying around $1,500 or more for an Apple phone.[3]<\/a><\/sup> These individuals willingly spend $35,000 on a second car, but if faced with the choice to relinquish their iPhone or relinquish the second car, they would opt to part with the second car.[3]<\/a><\/sup> It’s an exceptional product.[3]<\/a><\/sup> We don\u2019t have anything like that that we own 100% of, but we\u2019re very, very, very happy to have 5.6%, or whatever it may be, and we\u2019re delighted every 10th of a percent that goes up.\u201d<\/p>\n

Speaking at the company’s annual shareholder meeting, Buffett noted that the majority of Berkshire Hathaway’s businesses will actually report lower earnings this year than last year, attributing the expected downturn to a wider economic decline.[4]<\/a><\/sup> He also criticized the poor messaging from regulators, politicians, and the press to the American public about the banking crisis, and called out the executives in charge of failed banks for not being held accountable for mistakes that were hiding in “plain sight.” Despite this, Buffett expects earnings at Berkshire Hathaway’s insurance underwriting operations to improve this year.[1]<\/a><\/sup><\/p>\n

Overall, Berkshire Hathaway’s investment strategy has been focused on long-term value creation rather than short-term gains, with a strong emphasis on finding undervalued companies to invest in. While the company has faced challenges in finding attractive investments in recent years, its commitment to share repurchases and its investments in Occidental Petroleum and Apple suggest that the company remains focused on finding value in a challenging market.<\/p>\n

0. <\/span>“Warren Buffett: ‘Apple is not 35% of Berkshire’s portfolio'” Yahoo Finance, 6 May. 2023, https:\/\/finance.yahoo.com\/news\/warren-buffett-apple-is-not-35-of-berkshires-portfolio-175313329.html<\/a><\/a><\/p>\n

1. <\/span>“Warren Buffett says it\u2019s been an \u2018incredible period\u2019 for the economy but that\u2019s coming to an end” Fortune, 6 May. 2023, https:\/\/fortune.com\/2023\/05\/06\/warren-buffett-economic-outlook-berkshire-hathaway-lower-earnings-recession-economy<\/a><\/a><\/p>\n

2. <\/span>“10 Questions for Berkshire Hathaway’s 2023 Annual Meeting” Morningstar, 4 May. 2023, https:\/\/www.morningstar.com\/articles\/1154906\/10-questions-for-berkshire-hathaways-2023-annual-meeting<\/a><\/a><\/p>\n

3. <\/span>“Buffet: Apple is the best company” 9to5Mac, 7 May. 2023, https:\/\/9to5mac.com\/2023\/05\/06\/buffett-says-apple-best-business-of-any-he-owns<\/a><\/a><\/p>\n

4. <\/span>“Warren Buffett strikes dour tone on US economy, warns boom is over” Markets Insider, 6 May. 2023, https:\/\/markets.businessinsider.com\/news\/stocks\/warren-buffett-us-economy-outlook-recession-interest-rates-berkshire-hathaway-2023-5<\/a><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Warren Buffett’s conglomerate, Berkshire Hathaway, has recently made headlines for its investments in Occidental Petroleum and Apple. Berkshire Hathaway now holds a roughly 22.1% stake in Occidental Petroleum, and has been bullish on Apple since 2016, with Apple stock currently representing nearly 40% of Berkshire Hathaway’s equity holdings. Despite this, Buffett has noted that saying Apple comprises this percentage of Berkshire’s overall investment portfolio is not an accurate understanding of the business.[0]<\/a><\/sup><\/p>\n

Berkshire Hathaway listed $997 billion in assets at the end of the first quarter, with only $328.16 billion of those being investments in equity securities.[0]<\/a><\/sup> The company has turned towards buybacks more often as valuations in public markets had made it more challenging for Buffett to identify promising acquisitions.[1]<\/a><\/sup> As long as valuations of the publicly traded and privately held companies Berkshire prefers to acquire or invest in remain inadequate, making acquisitions and stock investments becomes harder to enact and the company seems to be stuck with share repurchases as the primary option for working down cash balances.[2]<\/a><\/sup><\/p>\n

For a long time, Buffett has expressed his admiration for Apple’s CEO Tim Cook and the lasting appeal of the company’s offerings, such as the iPhone.[0]<\/a><\/sup> Despite not understanding devices like the iPhone, he understands consumer behavior and how loyal customers are to Apple.[3]<\/a><\/sup> According to Buffett, consumers are paying around $1,500 or more for an Apple phone.[3]<\/a><\/sup> These individuals willingly spend $35,000 on a second car, but if faced with the choice to relinquish their iPhone or relinquish the second car, they would opt to part with the second car.[3]<\/a><\/sup> It’s an exceptional product.[3]<\/a><\/sup> We don\u2019t have anything like that that we own 100% of, but we\u2019re very, very, very happy to have 5.6%, or whatever it may be, and we\u2019re delighted every 10th of a percent that goes up.\u201d<\/p>\n

Speaking at the company’s annual shareholder meeting, Buffett noted that the majority of Berkshire Hathaway’s businesses will actually report lower earnings this year than last year, attributing the expected downturn to a wider economic decline.[4]<\/a><\/sup> He also criticized the poor messaging from regulators, politicians, and the press to the American public about the banking crisis, and called out the executives in charge of failed banks for not being held accountable for mistakes that were hiding in “plain sight.” Despite this, Buffett expects earnings at Berkshire Hathaway’s insurance underwriting operations to improve this year.[1]<\/a><\/sup><\/p>\n

Overall, Berkshire Hathaway’s investment strategy has been focused on long-term value creation rather than short-term gains, with a strong emphasis on finding undervalued companies to invest in. While the company has faced challenges in finding attractive investments in recent years, its commitment to share repurchases and its investments in Occidental Petroleum and Apple suggest that the company remains focused on finding value in a challenging market.<\/p>\n

0. <\/span>“Warren Buffett: ‘Apple is not 35% of Berkshire’s portfolio'” Yahoo Finance, 6 May. 2023, https:\/\/finance.yahoo.com\/news\/warren-buffett-apple-is-not-35-of-berkshires-portfolio-175313329.html<\/a><\/a><\/p>\n

1. <\/span>“Warren Buffett says it\u2019s been an \u2018incredible period\u2019 for the economy but that\u2019s coming to an end” Fortune, 6 May. 2023, https:\/\/fortune.com\/2023\/05\/06\/warren-buffett-economic-outlook-berkshire-hathaway-lower-earnings-recession-economy<\/a><\/a><\/p>\n

2. <\/span>“10 Questions for Berkshire Hathaway’s 2023 Annual Meeting” Morningstar, 4 May. 2023, https:\/\/www.morningstar.com\/articles\/1154906\/10-questions-for-berkshire-hathaways-2023-annual-meeting<\/a><\/a><\/p>\n

3. <\/span>“Buffet: Apple is the best company” 9to5Mac, 7 May. 2023, https:\/\/9to5mac.com\/2023\/05\/06\/buffett-says-apple-best-business-of-any-he-owns<\/a><\/a><\/p>\n

4. <\/span>“Warren Buffett strikes dour tone on US economy, warns boom is over” Markets Insider, 6 May. 2023, https:\/\/markets.businessinsider.com\/news\/stocks\/warren-buffett-us-economy-outlook-recession-interest-rates-berkshire-hathaway-2023-5<\/a><\/a><\/p>\n","protected":false},"author":3,"featured_media":3858,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[47],"tags":[],"_links":{"self":[{"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/posts\/3859"}],"collection":[{"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/comments?post=3859"}],"version-history":[{"count":0,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/posts\/3859\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/media\/3858"}],"wp:attachment":[{"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/media?parent=3859"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/categories?post=3859"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/tags?post=3859"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}