Buffett Letter to Shareholders May Detail How He Intends to Spend $109 Billion

Berkshire Hathaway (BRK.A) shareholders will look forward to hearing Warren Buffett detail his plans to participate in the U.S. healthcare system as well as the results for his sprawling conglomerate when the Oracle of Omaha delivers his annual letter on Saturday.

Buffett, 87, has used humor in his much anticipated, and often quite lengthy, letter to address topics ranging from excesses on Wall Street to dysfunction in Washington as he also relates what's going on at Berkshire, whose businesses extend to holdings in insurance, utilities, building products, clothing and footwear, flight services, media, and real estate. Buffett himself also manages a portfolio of billions of dollars of equities and investments.

The annual shareholders' meetings, taking place in the CenturyLink Center in Omaha, Nebraska, are routinely visited by 20,000 people.

Buffett's message is usually upbeat. Last year he cited the "economic dynamism" and "miraculous" achievements the U.S. has achieved over its history, after saying in 2015 that American newborns were "the luckiest crop in history."

Berkshire, which is holding about $109 billion of cash and equivalents, hasn't made a major purchase since it bought Precision Castparts more than two years ago. Last year it lost a bid to buy Texas power company Oncor, while its efforts to help buyout firm 3G Capital buy Unilever (UL) failed as the European food company said it wasn't interested.

Watch 'Jolt' for what Buffett should really divulge on Saturday.

Buffett may once again ask for companies that have low debt, consistent earnings and good management to give him a call, if they're interested in selling.

With few whole companies out there to buy, Buffett has instead built a $28 billion stake in Action Alerts Plus holding Apple (AAPL) , making it Berkshire's largest stock holding by value, passing troubled San Francisco-based bank Wells Fargo (WFC) .

Another element shareholders will be looking forward to is Buffett's description of the independent healthcare company for their employees in the United States that Berkshire, Amazon (AMZN) , and JPMorgan Chase (JPM) announced in January. Amazon and JPMorgan & Chase are both Action Alerts Plus holdings.

The joint venture would align Buffett's company with the biggest bank by assets in the U.S. and the online retail behemoth, which has already proved itself to be a disruptive force across several industries.

Buffett may address the effects of the new, lower corporate tax rate achieved by President Donald Trump and a Republican-led Congress, which may include a significant increase in book value.

He will likely take the opportunity to praise Gregory Abel and Ajit Jain, two long-time Berkshire executives who Buffett promoted in January to vice chairs of the company. At the time, Buffett said their promotion was "part of a movement to succession over time."

Abel, 55, is currently the chairman and CEO of Berkshire Hathaway Energy Company, which he joined in 1992. He's reportedly regarded by Wall Street as the most likely to ascend into Buffett's role eventually.

Jain, 66, is the executive vice president of National Indemnity Company who joined the Berkshire Hathaway Insurance Group in 1986. He was named vice chair of the insurance operations.

Along those lines, Berkshire shareholders will want to find out what effects the numerous natural disasters in the U.S. in 2017 will have on their insurance holdings, which include GEICO and Berkshire Reinsurance.

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