Buffett buys back record $5.1 billion in Berkshire stock due to COVID-19

Warren Buffett’s companies  were affected during the Coronavirus outbreak. Some of his wholly owned busy were affected and suffered losses. Berkshire Hathaway repurchased 5-point dollars’ worth of stock in May and June. It repurchased $4.6 billion of its Class B stock , and $486.6 in class A shares.

Berkshire Hathaway Inc. BRK.A, earned $26.3 billion, or $16,314 per Class A share, during the second quarter.  up from $14.1 billion or up $8,608 per share, a year ago.

The three most successful stocks under Berkshire Hathaway are Wells Fargo, Bank of America, JPMorgan Chase. American Express, and U.S Bank Corp.

American Express relies heavily on the travel industry. It is Warren Buffett second largest bank holding in the end of the first quarter 2020. The stock is down 25% since the beginning of the year but there was is lot of cash to cover, which amounts to about 9% of total loans. American Express stock will see gains as the economy recovers.

U.S. Bank Corp  reported 6 months earnings of $1.9 billion. The decline of 47% from the same 6 months a year ago is a smaller decline then the two top Banks in the United States. U.S Bank Corp has set aside enough amounting to 2.54% of total loans and has a strong capital position.

Bank of America is the second largest holding in Berkshire Hathaway portfolio. Incredibly so, Bank of America turn to 7.5-dollar profit in the first two quarters of the year.

JP Morgan Chase had a 7.62 profit for the first quarter of this year but it’s down about 60% the same time a year ago. Cash positions for potential loan losses amount to three points- 2% of total loans. Berkshire Hathaway only held  3% of outstanding shares of JPMorgan Chase in first quarter and had a higher 12% ownership stake in Bank of America. JPMorgan Chase has held up very well, considering the state of the economy with the pandemic.

Wells Fargo cut its dividend by 80% for the third quarter this year. The bank had losses of more than 1.7 dollars and has trailed down 55 percent since the beginning of this year.

Buffet sees Geico earnings will mostly decline into 2021. Geico is a wholly owned subsidiary Berkshire Hathaway.

Photo Credit- Flickr

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