Paul Morigi
Berkshire Hathaway (NYSE:BRK.B) (NYSE:BRK.A) Q4 operating earnings rose 28% from a year ago, driven by improvements in insurance underwriting and investment income, which more than offset declines at its railroad, utilities and energy, and other businesses.
The company doubled the amount of its common stock it repurchased to $2.2B during the quarter compared with $1.1B in Q3, bringing 2023 purchases to $9.2B.
The investment titan held ~$167.6B in cash and short-term securities on its balance sheet as of Dec. 31, 2023, climbing from $157B at Sept. 30.
Q4 operating income of $8.48B declined from $10.8B in Q3 and increased from $6.63B a year ago. Insurance underwriting income more than quintupled, while its insurance investment income increased by 38%.
Insurance float stood at ~$169B at Dec. 31, 2023, up from $167B at Sept. 30 and $164B at Dec. 31, 2022.
Operating income by segment vs. a year ago:
- Insurance – underwriting: $848M vs. $160M
- Insurance – investment income: $2.76B vs. $2.00B
- Railroad: $1.36B vs. $1.47B
- Utilities and energy: $632M vs. $739M
- Other businesses: $3.69B vs. $3.71B
- Other: -$804M vs. -$1.45B
Investment and derivative gains, most of which are unrealized, surged to $29.1B in Q4, compared with losses of $23.5B in Q3 and gains of $11.5B in Q4 2022.
Looking at Berkshire’s (BRK.B) investmens in equities, ~79% of the portfolio’s fair value was concentrated in five companies — Apple (AAPL) – $174.3B; Bank of America (BAC) – $34.8B; American Express (AXP) – $28.4B, Coca-Cola (KO) – $23.6B, and Chevron (CVX) – $18.8B. That compares with 78% concentration in the same five companies as of Sept. 30, 2023.
Its stake in Occidental Petroleum (OXY) rose to $14.5B, at fair value from $12.2B at Dec. 31, 2022. Meanwhile, its holdings in Kraft Heinz (KHC) declined to $12.0B, at fair value, from $13.2B.
