This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Buffett's Berkshire Builds Verizon Stake, No IBM Buying Spree

NEW YORK (TheStreet) - Berkshire Hathaway (BRK.A) disclosed on Thursday it had taken an over 11 million share stake in Verizon (VZ - Get Report) worth over $500 million. The conglomerate added marginally to its investment in IBM (IBM - Get Report), amid the IT services giant's struggles.

Berkshire said in a 13-F filing with the Securities and Exchange Commission, it bought 11 million Verizon shares and 7.35 million Liberty Global Class C (LBTYK) shares in the first quarter, two new positions and likely investments made by the conglomerate's rising stars Ted Weschler and Todd Combs.

IBM was the only company where Berkshire added to its so-called big four stock investments, which also include Wells Fargo (WFC), Coca-Cola (KO) and American Express (AXP). However, Berkshire's buying was limited to just 233,100 new shares, less than 1% of the company's overall investment in IBM. Other additions included Davita Healthcare Partners (DVA), US Bancorp (USB) and Liberty Global (LBTYA).

Berkshire also added to its investment in Wal-Mart and trimmed its investment in General Motors (GM), Phillips 66 (PSX), Starz (STRZA), and DirecTV (DTV). The company didn't close any investment positions in the quarter.

Must Read: Detroit Bankruptcy Check-In: Will Lansing Extend a Lifeline?

Berkshire Earnings

Earlier in May, Berkshire reported a 5% drop in its operating earnings to $3.5 billion as insurance margins at the Warren Buffett-conglomerate dropped, crimping profits.

Still, the company's first-quarter earnings indicate a continued payoff from bets Buffett has made on energy, infrastructure and an improving U.S. economy in the years since the crisis.

By Warren Buffett's preferred valuation metric, Berkshire Hathaway outperformed the S&P 500, a reversal of a trend of under-performance in recent years.

Berkshire reported $45.4 billion in revenue and net income of $4.7 billion, or net earnings per share of $2,862 per Class A share. Operating earnings were $2,149 per Class A share, generally slightly below analyst consensus.

Of note, revenue at Berkshire's railroad, utilities and energy divisions rose to $9.75 billion, an over 20% rise in the first quarter from year-ago levels.

Insurance revenue, by contrast, rose marginally to $33.9 billion versus the first quarter of 2013. Overall, flat insurance revenues and rising costs meant Berkshire's net income fell slightly year-over-year.

Investment gains at Berkshire Hathaway surged to $1.059 billion for the quarter, up more than 100% from the $434 million in gains the company reported in the first quarter of 2013. Those gains were buoyed by $188 million in earnings attributable to Berkshire from its participation in the takeover of ketchup-maker H.J. Heinz, a deal announced in the first quarter of 2013.

>>Read More: Berkshire's Renewable Energy Investment to Hit $15 Billion

>>Read More: Berkshire Hathaway's Next Elephant Acquisition

>>Read More: Berkshire's Bet on the Greening of Nevada

>> Read More: Berkshire's Elephant Guns to Hit Utilities Deals

-- Written by Antoine Gara in New York.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
VZ $47.20 0.00%
IBM $165.09 0.00%
WMT $71.86 0.00%
AAPL $126.44 0.00%
FB $87.28 0.00%

Markets

DOW 17,730.11 -27.80 -0.16%
S&P 500 2,076.78 -0.64 -0.03%
NASDAQ 5,009.2140 -3.9090 -0.08%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs