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Warren Buffett’s Berkshire Hathaway Spends $9 Billion on Buybacks in Q3

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Berkshire Hathaway bought more stocks and ramped up share buybacks in the third quarter.

In Q3 earnings report released by Berkshire Hathaway Inc (NYSE: BRK.A) on Saturday, Warren Buffett‘s conglomerate repurchased $9 billion of its own stock. Compared to the record figure that amazed many of $5.1 billion in the second quarter, Berkshire has nearly doubled the amount of buying its stocks during the third quarter. Now the total buybacks during 2020 amount to $15.7 billion.

UBS had estimated a total quarterly buyback of $3.2, however, it was surpassed since the company repurchased Class A shares worth over $2.5 billion and Class B worth almost $6.7 billion. Buffett chose to repurchase at a tough time when coronavirus had impacted the company’s insurance, utilities, and railroad businesses.

Cash Pile of Berkshire Hathaway Stands Still in Q3

Besides owning companies such as Burlington Northern railroad, See’s Candies and Geico, Buffett’s company has invested billion-dollar in public companies like Coca-Cola Company (NYSE: KO), Bank of America Corporation (NYSE: BAC) and Apple Inc (NASDAQ: AAPL).  During the third quarter, Berkshire’s biggest stock holding Apple rallied over 26% while Coca-Cola achieved 10.5% higher than the tech firm. On a year-over-year basis, Berkshire’s net earnings from its big investments in the public market skyrocketed to $30.137 billion, an over 82% increase.

Buffett was quick to caution investors not to peg their hopes in net earnings due to the unrealized and volatile nature of investing gains. The caution might be wise since Berkshire’s operating earnings of $5.478 billion were over 30% down from the figure in the same period last year.

Berkshire stock has, for a large part of this year, widely underperforming the S&P 500 but has surpassed the 8.5% gain in the index to climb almost 20% in the third quarter. However, Class A shares fell 7.6% in comparison with the S&P 500 total return of 10%. Though shares climbed through the quarter, the company decided to increase its repurchases.

Berkshire’s cash pile in the third quarter has stood still at $145.7 billion even after experiencing record buybacks throughout this year. Accumulation of the funds is taking place much faster than Buffett can manage to invest in higher-returning assets.

Buffett Now Appreciates Buybacks More

During the annual meeting in May, Buffett told Berkshire shareholders that repurchasing shares wasn’t a fruitful venture now than before the pandemic when stocks were much higher. However, just months after, Buffett is more optimistic about the conglomerate’s prospects following the heightened buybacks. He seems to have disposed of his long-held aversion to share buybacks.

Earlier this year, Buffett revealed in his annual letter that he had discussed with Charlie Munger, Berkshire Vice Chairman, about the decision to repurchase stock.

 “Our thinking, boiled down: Berkshire will buy back its stock only if a) Charlie and I believe that it is selling for less than it is worth and b) the company, upon completing the repurchase, is left with ample cash,” Buffett wrote.

In a move to supercharge his conglomerate’s growth, Buffett, 90, has over the years struggled in his quest to get attractive deals that would enable him to deploy his cash pile into higher-returning assets. Besides the repurchases in the quarter, the bona fides dealmaker’s other capital-deployment maneuvers takeover of Dominion Energy’s natural gas transmission, a bet on Snowflake Inc (NYSE: SNOW) as well as a $6 billion investment in Japanese trading houses.

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James Lovett is a talented crypto enthusiast who finds pleasure in sharing more knowledge on fintech, cryptocurrency as well as blockchain and frontier technologies. He likes to keep himself furnished and updated with the latest innovation in the crypto industry, blockchain technology, Internet of Things (IoT) and other technologies. As a result, he tries to furnish ardent crypto supporters with the latest news on blockchain and distributed-ledger technologies. Indeed, Blockchain and Cryptocurrency is changing the world as we know “one block at a time”. As a hobby, he also trades in small amounts of cryptos every now and then.
An author with experience writing for tech, digital, and cryptocurrency blogs!



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Apple to Debut Faster Watch with Temperature and Glucose Testing Capabilities, AAPL Stock Slightly Up

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Beyond the company’s move in seeking advancement in its smartwatch, it is also working assiduously to explore new areas, notably in the Apple car pursuits.

American multinational technology company Apple Inc (NASDAQ: AAPL) is set to debut a faster model of Apple Watch as the tech giant seeks to beat competitors in terms of product performance. Per a Bloomberg report citing people close to the company’s plans, the proposed new Apple Watches will also brandish the abilities to check temperatures and user’s blood glucose levels.

The Apple Watch was debuted in 2015 and has grown to become a vital part of the Cupertino-based company’s product suite. While the watches have seen bigger upgrades in times past, the currently scheduled boost will place it at the echelon of smartwatches with unique capabilities in the market. The temperature check feature became a necessity following the advent of the COVID-19 pandemic, and the increased demand for handy temperature checkers.

As against the usual format for checking blood glucose levels, the feature designed into the Apple Watches will not involve pricking fingers for traces of blood. Instead, the Apple technology will analyze the blood without being invasive, according to the Bloomberg report. The new model dubbed the Apple Watch Series 7 also has a faster processor, improved wireless connectivity, and an updated screen. 

The Apple Watch with the temperature capability may not be hitting the market until the next year 2022, while that designed to check blood glucose may take a couple more years before it is available commercially.

Apple stock is currently trading at $127.79 in the pre-market, representing a growth of 0.35% from the previous close.

Beyond Apple Watch, the Company Is Expanding Its Product Suite

One of the major tenets of the top technology companies including Apple is the ability to innovate and match with the competition. Beyond the company’s move in seeking advancement in its smartwatch, it is also working assiduously to explore new areas, notably in the Apple car pursuits.

While the details of the Apple self-driven car production remain sketchy, CEO Tim Cook once confirmed the firm is building its tech in autonomous systems. Per his word;

“We’re focusing on autonomous systems. It’s a core technology that we view as very important. We sort of seeing it as the mother of all AI projects. It’s probably one of the most difficult AI projects actually to work on.”

Many have attributed this comment to the proposed self-driven cars which have been spotted on many occasions being tested by the company on the streets of California. The latest update from the Apple cars involves the potential pursuit of a partnership with either Contemporary Amperex Technology Co. Ltd. (CATL) and BYD Ord Shs A (SHE: 002594) for Lithium Iron phosphate batteries supply, according to an earlier Coinspeaker report.

The deal has neither been confirmed by either Apple or the two companies, however, people close to the matter noted the conditions to set up a plant in the United States set by the former is of disinterest in CATL. The cost considerations and the unrest between Washington and Beijing are the major considerations to pull the deal through.

Apple’s ties with Chinese firms are well engrafted as the assembling of the proposed upgraded main Apple Watch will be done by Luxshare Precision Industry Co Ltd (SHE: 002475). The Apple Watch SE is billed to be assembled by Foxconn Technology Co Ltd (TPE: 2354) alongside Taiwan’s Compal Electronics Inc (TPE: 2324).

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Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.



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El Salvador Becomes First Country to Accept BTC as Legal Tender, Its Cogress Approves Bitcoin Law

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President Bukele said the country may explore Bitcoin mining as a way to put its geothermal energy option to full use.

Latin American nation, El Salvador has made history as the first country to accept premier digital currency, Bitcoin (BTC) as a legal tender. Per a Coindesk report, a supermajority in the country’s legislative arm voted in favor of the Bill proposed by President Nayib Bukele to officially recognize the cryptocurrency as an official currency to complement the United States Dollar it currently uses.

Bitcoin has come a long way from when it was first introduced by Satoshi Nakamoto with the publishing of the currency’s Whitepaper in 2008, and the eventual launch of the currency in 2009. Since then, the coin has been tossed around in many scenarios, some encouraged its growth, and others largely held it bound. Government regulations, energy consumption criticisms to mention a few accounts for the latter, however, events in the past year seeing multinational corporations begin to invest and acquire the digital currency stirred the changes we are seeing today.

While many governments are exploring means to clamp down on crypto and Bitcoin activities, in particular, the El Salvadoran legislature has teamed up with Bukele to back the coin for its uniqueness. The vote that passed the bill came with 62 members voting in favor, 19 voting against, and 3 abstentions. The nation’s move is against the norm and there are plans for government officials to go explain the plans of the new law to the International Monetary Fund (IMF).

Bitcoin Is a Legal Tender in El Salvador: Here’s What to Expect

With Bitcoin becoming an official legal tender – as will be finalized when President Bukele signs it into law – businesses are now mandated to accept the cryptocurrency for payments. Beyond payments, all forms of taxes can be paid using BTC, transactions or investments involving Bitcoin will not be subjected to a capital gains tax.

The acceptance of Bitcoin as a legal tender is not targeted at offsetting the role of the Dollar in the country’s payment ecosystem and will serve as the reference point for the new form of money. The issue of volatility is also going to be addressed through a Trust that will be opened at the Development Bank of El Salvador. This trust is going to help mitigate the risks associated with price fluctuations as it will help merchants in the conversion of their Bitcoin holdings to Dollar in real-time. An initial allocation of $150 million will be made into the new Trust.

“If there’s an ice cream parlor, he doesn’t really want to take the risk, he has to accept bitcoin because it’s a mandated currency but he doesn’t want to take the risk of convertibility, so he wants dollars deposited in his banking account, when he sells the ice cream, he can ask the government to exchange his bitcoin to dollars,” said President Bukele in a Twitter Space conversation hosted by Nic Carter of Castle Island Ventures. “Of course he can do that in the markets also but he can ask the government to do it immediately.”

In addition, President Bukele said the country may explore Bitcoin mining as a way to put its geothermal energy option to full use.

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Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.



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Robinhood IPO on Horizon with $30 Billion Valuation Expected

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Robinhood IPO will offer over 22 million Class A shares, whereby they will be priced at $16-$19 per stock.

Robinhood Markets Inc, an America-based fintech company, has inched its way towards a $30+ billion IPO deal following immense growth in the past year. Its rapid development is attributed to its trading platform’s user-friendliness and simplicity, making it popular among the younger generation. Currently, it boasts of about 13 million users and a net value of over $11 billion having experienced a revenue ascent to around $260 million in 2020 from around $110 million in 2019.

Nevertheless, Robinhood has faced heavy backlash and lawsuits in the past year. The iconic Berkshire Hathaway investor Warren Buffett discredited the company’s reputation for easy trading by saying that it promotes a casino-like behavior. His partner Charles Munger backed him up saying it makes the stock market a gamblers’ ground and it makes money in “dirty ways”.

Additionally, a complaint was filed by Massachusetts regulators against Robinhood. Accusations ranged from their gamification of trading and use of aggressive methods to failure in preventing disruptions and outages in their trading platform. Rich Repetto, a brokerage analyst from Piper Sandler, reported that the company’s “zero commission” statement was true, however, its order flow payments and high trading volumes did more than cater for the revenue gap.

Furthermore, multiple class-action lawsuits have hit the company following their trading outages last year. Many users reported being locked out of the trading platform during major moves. Recently also, users reported restrictions from purchasing volatile stocks and unresponsive customer service.

Robinhood reacted to critics, saying that their users preferred the new way of trading compared to traditional methods. The company also reiterated its transparency and distanced itself from any conflicts of interest in its business model. More recently, the company has improved their customer service one of their customers committed suicide.

Amidst the chaos, Robinhood’s iOS downloads increased exponentially and more than $3 billion was raised by venture capitalists.

Bigger Picture on Robinhood IPO

Robinhood completed all requirements for its $30+ billion IPO offering, with Nasdaq as its stock exchange preference. It also widened its executive team to include Silicon Valley and Wall Street veterans such as Amazon’s Jason Warnick.

Silicon Valley’s unicorn has continued to express its novelty by allowing non-professional investors access to its shares before its IPO debut. Robinhood IPO will offer over 22 million Class A shares, whereby they will be priced at $16-$19 per share. Consequently, Robinhood users can now purchase the company’s shares on the Robinhood app. This move is intended to decentralize investment by making it accessible to people of diverse financial status rather than professional traders and the wealthy few.

To encourage both novice and experienced investors, Robinhood has provided prospectus with detailed information on its IPO including its business model, administrative personnel, and risks of investment.

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A financial analyst who sees positive income in both directions of the market (bulls & bears). Bitcoin is my crypto safe haven, free from government conspiracies.
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“You cannot enslave a mind that knows itself. That values itself. That understands itself.”



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