Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

Click here to see some testimonials from our members!

How Will Berkshire Hathaway Deploy Its $100 Billion in Cash?

By Dr. David Kass. Originally published at ValueWalk.

After the market closed on Friday, August 4, Berkshire Hathaway released its Form 10-Q for the quarter ending June 30, 2017.  This filing revealed a record cash position of $100 billion as compared to $96 billion on March 31 and $86 billion as of December 31, 2016.

Get The Full Warren Buffett Series in PDF

Get the entire 10-part series on Warren Buffett in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues.

We respect your email privacy

Warren Buffett

Also see

Berkshire Hathaway B shares Warren Buffett
By Mark Hirschey (Work of Mark Hirschey) [CC BY-SA 2.0], via Wikimedia Commons

Warren Buffett previously stated that Berkshire intends to hold a permanent cash position of $20 billion and would like to invest the remaining cash of $80 billion since it is currently earning a rate of return close to zero.  What are Berkshire’s likely options?

There are three approaches that Berkshire is likely follow:

(1) Acquire one or more large companies such as its 2016 purchase of Precision Castparts for $32 billion and its 2010 acquisition of Burlington Northern Sante Fe for $26 billion (for the 77.4% it did not already own).  Warren Buffett will participate in friendly deals only and will avoid auctions.

(2) Partner with 3G Capital to provide $10 billion or more to acquire companies such as the acquisition of Kraft by Heinz (to form Kraft Heinz) in 2015.

(3) Common stock investments such as Berkshire’s 2016-17 purchase of shares in Apple which are currently valued at about $20 billion.  Berkshire’s equity investments equaled $137 billion on June 30.  (Warren Buffett’s portfolio managers, Todd Combs and Ted Weschler, each manage about $10 billion.)

Warren Buffett is extremely patient and will invest only when the opportunity is very attractive. With the stock market at all-time highs it is becoming more difficult to find undervalued stocks.  However, future market fluctuations should provide additional opportunities.

The post How Will Berkshire Hathaway Deploy Its $100 Billion in Cash? appeared first on ValueWalk.

Sign up for ValueWalk’s free newsletter here.


Do you know someone who would benefit from this information? We can send your friend a strictly confidential, one-time email telling them about this information. Your privacy and your friend's privacy is your business... no spam! Click here and tell a friend!





You must be logged in to make a comment.
You can sign up for a membership or get a FREE Daily News membership or log in

Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

Click here to see some testimonials from our members!