What to expect ahead of Berkshire’s reports and Buffett’s annual letter

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One of the most important and well-known voices in the market is of course the legendary investor, Warren Buffett. Buffett’s recommendations influence many investors and his insights from decades in the market can help shed light on where the markets are today. Tomorrow the holding company of Buffett and his partner Charlie Munger will publish –


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its reports for the last quarter of 2022. The market now expects the company to report revenues of $79.83 billion and earnings per share of $3.539.

Berkshire has not missed analysts’ forecasts for four consecutive quarters, but the concern regarding the current quarter actually exists – the company’s largest holding, Apple


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missed analysts’ forecasts in the last quarter, for the first time since the first quarter of 2016. In addition, one of the relatively new stocks – the energy company Occidental


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will report its results for the last quarter next week, but in the last quarter there was a drop of more than 20% in the share price due to the drop in oil prices, which is also expected to affect Berkshire’s results.

Another influence on the company is also the insurance company GEICO, which was the one that caused the most damage to Berkshire in the last year when it lost in the first nine months of 2022 an amount of 1.42 billion dollars, compared to a profit of 1.36 billion dollars in the corresponding period.

About a week and a half ago, Berkshire published its holdings update. Among the surprising changes was the reduction of holdings in the world’s leading chip company


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by 86%, which led the next day to a drop of about 5% in the Taiwanese company’s stock. In addition, Berkshire sold a significant amount of


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At the time, the holding in Apple only increased to a total of about 915 million shares, due to shares held by the Allegheny holding company that Buffett purchased.

Another thing that will keep investors busy is Buffett’s annual letter to Berkshire Hathaway investors. In the letter, Buffett provides his position regarding the current state of the markets and many investors are eagerly waiting to hear his words. Given that the last year has been very special, with many changes such as the increase in interest rates and inflation, the weakening of the stock market and the increase in government bond yields, the letter will likely be more significant than the previous letters in the last decade.

An equally important matter regarding all the reports tomorrow is the future of Berkshire – Buffett is 92 years old and Manger is already 99 years old, it is clear to everyone that both of them will not be with us for many more years. Buffett’s expected replacement is Greg Abel, who is now in charge of the company’s non-insurance business. “The directors agreed that if something happens to me tonight, Greg is the one to replace me tomorrow morning,” Buffett said not long ago. On the other hand, Ajit Jain, the Vice Chairman of Berkshire is expected to fight for the coveted seat of the CEO of Berkshire Hathaway.

In the latest reports, the company recorded a profit of $3.529 per share on revenues of $76.93 billion, this compared to the expected profit per share of $2.805 on revenues of $77.68 billion. The company’s stock has decreased since the beginning of the year by 1.8% and in the last year it has remained stable, this compared to a 3.2% increase in the S&P 500 index since the beginning of the year and a decrease of 7.63% in the last year. The company’s market value is about $670 billion, 16% below the March peak of last year.

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