Berkshire Hathaway's annual meeting to feature Buffett and Charlie Munger

5
4 minutes
Berkshire Hathaway's annual meeting to feature Buffett and Charlie Munger

Warren Buffett and vice chairman Charlie Munger are seen at the Berkshire shareholder shopping day in Omaha, Nebraska, U.S. May 3, 2019.The REUTERS Scott Morgan Morgan

On Saturday, Berkshire Hathaway Inc.'s widely anticipated second meeting will be virtually held for a third year but can restore a bit of normalcy as Warren Buffett rejoins his fellow billionaire Charlie Munger to answer shareholder questions.

The meeting gives Buffett, 90, and Munger, 97, a space to explain over 3 -- 1 -- 2 hours what to expect from Berkshire's many businesses, markets and economy, and whether the company will continue aggressive share repurchases.

Still, with no shareholders in attendance, it will be shorn of the festivities that normally draw around 40,000 annually to Omaha, Nebraska for what Buffett calls Woodstock for capitalists.

The Berkshire event, it's hard to describe to someone who has never been there, said Jim Weber, chief executive of the company's fast-growing Brooks Running unit.Nevertheless, the meeting will continue and I'll be watching it, probably on my treadmill.

Warrent has been running Berkshire since 1965, and Munger has been vice chairman since 1978.

The other vice chairmen Ajit Jain and Greg Abel, who respectively oversee Berkshire's non-insurance and insurance businesses, will be on hand to answer some questions.They are the top contenders to succeed Buffett as Berkshire chief executive.

Buffett's meeting with Munger on Friday would illustrate how Buffett and Munger have thrived together for so long despite differences in politics - Buffett is a Republican, Munger often a democrat - and often investment ideas.

Munger, a Massachusetts native, did not travel to the Omaha meeting last year that was disrupted by the pandemic.

Buffett said in his shareholder letter this year that he is travelling to Los Angeles to reunite with his friend and partner of more than six decades, Buffett.

Warren's perspective often may challenge Charlie's, said Paul Lountzis, president of Lountzis Asset Management LLC in Wyomissing, Pennsylvania and a Berkshire shareholder.Warren said it often expands to his friend Warren in a more direct way and with a great sense of humor.

Like Buffett, Munger tries to teach as he thinks long-term and avoids investing whose main attribute is being in vogue.

Russo Quinn is tranquil, said Tom Russo who has invested more than $10 billion in Gardner, Russo Quinn in Berkshire and has invested in Lancaster, Pennsylvania since 1982.For those people who follow that reassurance, the rewards have been mighty

The meeting will be broadcasted on Yahoo Finance, which reported last year that the meeting drew 2.5 million streams.

It is backed by Berkshire shares on a roll out, outpacing the Standard Poor's 500 by seven percentage points in 2021 through Wednesday.

That's an improvement from 2019 and 2020, when value stocks lagged and Berkshire, which pays no dividend, trailed the Index by 36 percentage points.

Thursday night's meeting will begin for a few hours after Berkshire published first quarter results.Analysts expect the operating profit -- which excludes stocks such as Apple Inc and Bank of America Corp -- to be similar to last year.

In a letter to Berkshire the company will also say how much of its own stock it bought as part of $24.7 billion of new profits in 2017 following buybacks in 2008.

Russo said that buybacks will be on everyone's mind, but they won't stop either way.

Henry H Armstrong Associates, president of shareholder James Armstrong Associates in Pittsburgh, hopes Buffett and Munger will discuss how Berkshire can be managed over the long term to address its most important investment problem, its large size.

Shareholders will likely reject two proposals requiring more disclosures about climate change and diversity.Buffett and Berkshire, who have almost one-third of its voting power, oppose both.While Berkshire's Omaha office never suffered during the pandemic, many businesses suffered, and Buffett and Munger will likely address their plans for better times ahead.

Precision Castparts is trying to rebound from a slump in the automotive market that erased demand for its parts, costing a $9.8 billion writedown and 13,400 loss jobs.

And while the Geico car insurer, led by Todd Combs, one of Buffett's investment managers, saw accidents losses decline, it drew criticism for offering drivers only credit on policy renewals when other insurers rebated premiums.

Other possible issues are the failed venture with Amazon.com Inc and JPMorgan Chase Co to cut healthcare costs, and its $8 billion proposal to build 10 Texas power plants to avert more devastating blackouts in that state.

It would be no surprise to hear the Disdain for bitcoin, which Buffett called straw poison squared and Munger termed the pursuit of the unchangeable by the unspeakable.

Munger said the craze for public business acquisition companies that take private companies, representing a special bubble, has signaled an annoying bubble.

  • Comments
Loading comments...