저자: PatrickBoyle · 외국인
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버크셔 해서웨이 2020년 1분기 실적과 주총 전망을 다룬 영상으로, 워런 버핏의 방어적 태도와 시장 과열 신호를 강조한다. 버크셔 A주는 연초 대비 약 19% 하락해 S&P500보다 부진했고, 12개월 기준으로도 약 16% 하락했다. 1분기 순손실은 약 555억 달러로 버크셔 사상 최대 분기 손실이며, 영업이익은 6% 증가했다. 현금성 자산은 약 1,370억 달러로 늘어 버핏이 대규모 투자를 자제하고 있음을 보여준다. 코로나 봉쇄로 자동차 사고가 줄어 GEICO가 보험료를 환급했고, 보험업계 전체는 행사 취소 등으로 청구가 늘 수 있다고 분석했다. 항공주(델타, 사우스웨스트)는 매도했으며, 버핏이 항공주에 대해 부정적이라는 점을 재확인했다. 파일럿(주유소 체인) 지분을 늘려 유가 반등에 대한 간접 베팅으로 해석했다. 대규모 S&P500·유럽 지수 풋옵션 매도 포지션은 시장 하락 시 손실 위험이 있어 부담 요인으로 지적했다. 2023년 2월 만기로 보인다. 옥시덴털 페트롤리엄 우선주 상각은 하지 않았고, 관련 채권은 60센트 미만에 거래되는 것으로 언급됐다. 버핏 지표(시가총액/GDP)는 179%로 사상 최고치라 고평가 신호로 제시됐다. 영상은 버핏이 과거 닷컴·2008년 위기 전에도 이 지표가 급등했다는 점을 강조한다. 가치주는 2003년 이후 대체로 부진했고, 최근 경기민감 가치주가 시장보다 더 떨어졌다. 반면 빅테크(FAANG)는 자본 경량 구조 덕에 상대적으로 유리하다고 평가했다. 버핏과 멍거는 최근 공개 발언을 자제했고, 2020년 주총은 온라인 생중계로 진행되며 그렉 아벨이 함께 출연한다. 결론적으로 영상은 버핏의 현금 보유와 방어적 자세를 근거로 시장이 과열되었을 가능성을 경고하는 논조다.
다듬은 글
Hello YouTube. Welcome back to Patrick Boyle on finance. So today's video is all about Warren Buffett and Berkshire Hathaway. Uh Berkshire Hathaway's first quarter earnings for 2020 just came out and so we'll get to see what Warren Buffett has been doing during the coronavirus lockdown. Has he been investing or has he been reducing his stock market positions?
We'll learn about the upcoming annual general meeting which occurs this afternoon and is live streamed this year rather than an in-person event. And if you stay tuned to the very end of the video, I'll tell you about Warren Buffett's favorite stock market indicator and what it's telling investors right now.
Okay, so it hasn't been a great time recently in financial markets. I think anyone who's been watching the news will be aware of that. And Warren Buffett, one of the greatest investors in history, has definitely not been immune to to the effects of this lockdown and market sell-off. And Berkshire A shares were down around 19% year-to-date, which is quite a bit worse than the S&P 500.
And they're down about 16% over the last 12 months and over the same 12-month period, I think the S&P is down only around 3%. So it's been a difficult time at Berkshire Hathaway and a difficult time for Warren Buffett. Now, in the long run, Warren Buffett's doing just fine, obviously. He's more than doubled the returns of the S&P 500 since 1965.
So over that long time, he's had about twice the the growth rate of the S&P. Uh but most of that outperformance was pre-2003. So the last number of years have not been great for Warren Buffett. And in truth, they just haven't been great for value investing, which is sort of the investment style that Buffett is most famous for.
Um value investing last outperformed during the dot-com meltdown in the early 2000s. So, kind of similarly to Buffett, uh value investing has just not been great recently. So, that we'll talk a little bit about that. Um so, what has Buffett been saying up until now about the market? In truth, he's been very quiet.
Um back in 2008, he wrote pieces that went on the front page of the New York Times, and he was very vocal about it and possibly being a good buying opportunity. Um recently, he called the the recent oil volatility and panic in stock markets as a big one-two punch, you know? So, not not really the most positive statement.
Uh the CEO of Chubb, uh the insurance company one of his holdings, referred to the COVID-19 lockdown as likely to be the largest event in insurance industry history because it affects both sides of the balance sheet. So, there's So, there's two effects happening in the insurance business. And of course, uh you know, that is uh that's Berkshire Hathaway's main business.
Uh auto insurance companies such as Geico, one of one of Buffett's I think it might be his biggest holding, um have actually returned some money to uh to to policy holders basically because they're not driving their cars, and there's just been a big fall off in uh in automobile accidents. And so, they actually wrote checks to some of their customers in order to uh you know, make them even on the fact that they bought insurance for a vehicle that they're using way less than might be expected.
And so, Geico is probably doing quite well, um but the industry might also see some claims from things like canceled events and workers compensation insurance and that sort of thing. So, it'll be interesting to see how that works. Now, we'll talk a little bit more about the value and and value stocks not having performed very well recently.
So, as I mentioned earlier, it's really value hasn't performed very well since 2003. And I remember even earlier this year having a conversation with a friend of mine who was a little bit bearish, and the discussion was along the lines that maybe it's time to move into value stocks simply because the stock market itself is up huge since the credit crunch, but a lot of the gains have been in US large cap stocks, and a lot of value stocks and uh international stocks and small cap and medium cap stocks are actually sort of flat since the financial crisis around 12 years ago.
And so, my friend was discussing whether it was a good idea to buy these stocks because his idea, this was pre-COVID, his idea was that in a big market sell-off, the ones that had rallied the least would sell off the least. Now, that is not really what has happened so far this year. In fact, a lot of those stocks have done worse than the market in general, and some of that is just that a lot of the stocks that you would consider value stocks, if you look at the big value indices or value mutual funds, you'll see an awful lot of highly economically sensitive and levered stocks.
You see a lot of oil company stocks, that sort of thing, financials in there, and they have not done that well during the sell-off. And in fact, the FAANG stocks, the biggest stocks in the S&P 500, have actually been possibly the best suited to this environment in that they don't really need capital and in that they are generally technology type companies, companies like like Netflix, which have done well.
Um you know, all of these big companies like Google and Amazon and so on have actually been particularly well suited for a variety of reasons to uh to the current uh market situation. Buffett highlighted actually in a recent interview how many of the biggest tech stocks in the S&P don't really require capital at all.
Now, the really incredible companies and the ones that account for just the top five would have would be well over 10% of the market value of the company country. Uh they really don't they don't take capital that much that they make it that their suppliers may in some cases and all that, but but they are really overwhelmingly their capital light and and that is really different.
So, as you can see value hasn't performed in quite a while. It's not performing during the the sell-off portion of this COVID-19 lockdown, but a lot of value proponents will tell you that value usually performs best coming out of a recession and that's probably the nature just being in a lot of these more cyclical stocks.
And so for that very reason a lot of people want to know what Buffett's been up to and when he'll start deploying Berkshire's $128 billion dollar cash position that he's been sitting on. Now, Buffett himself has a lot of detailed information about the US economy simply through all of the subsidiaries that he owns.
Charlie Munger, his partner, told the Wall Street Journal last month that Berkshire would likely close some of its smaller holdings as a result of the pandemic. He didn't specify which businesses would be affected and so obviously investors are eager to find out what these guys are thinking. Now, Berkshire did sell off sizable stakes in Delta Airlines and Southwest Airlines as the coronavirus battered the travel industry.
Buffett, of course, has famously had a terrible time investing in airline stocks. There's sort of a famous quote of his where he said, "A durable competitive advantage has proven elusive ever since the days of the Wright brothers. Indeed, if a far-sighted capitalist had been present at Kitty Hawk, he would have done his successors a huge favor by shooting Orville down." So, as you can see, Buffett uh he doesn't like airline stocks that well, but he he seems to from time to time invest in them, and it it probably um doubles his uh his distaste for the sector.
Um but anyhow, um Buffett, what does he like to invest in? Well, he's consistently said that there's three um three criteria for the type of company that he's consistently on the lookout for. The first one is that they have to earn good returns on the net tangible capital required in their operation.
The second thing is that they must be run by able and honest managers. And the third is that they must be available at a sensible price. So, is that something he's seeing in the market today? Buffett, as you possibly know, doesn't like buying shares as much as whole companies. He prefers buying whole companies simply because of the tax advantages.
Um you know, if you if you invest in a company, you get the entire cash flow associated with the owning the company, while often those uh a lot of that gets held up in retained earnings in in a stock, which is fine, except for the fact that uh that it the only way to crystallize that is to sell the stock and to pay the 21% capital gains taxes.
And of course, Warren Buffett, despite what he often says in the press, he does hate paying taxes. So, what did he do? I guess that's the point of today's video. Well, cash and cash equivalent seem to have increased over the quarter, so they're now at 137 billion. So, he hasn't been spending an awful lot of money.
He did do a $1.7 billion dollar over the quarter. Um he has had losses of 55 and a half billion in the first quarter. So that's actually I looked it up. That is the largest uh quarterly loss that Berkshire Hathaway has ever taken. So it's it's his worst quarter. So it'll be very interesting to watch today's annual uh review uh just to see what he has to say about that.
Now operating income over the period was up 6%. So it's not all gloomy news. Uh but he does say in in the 10-Q that the lockdown began to significantly affect our operating businesses in March. So really in truth it's only started. Um and and he does say that he doesn't know how long this will go on for.
This is a a terrible event that's occurring. We don't know how terrible it and it may not turn out to be that big a deal uh when we get through it but it may turn out to be a very big deal when we just don't know. And I certainly don't know. There have been increases in allowances for credit losses that the the statements say uh relate to the manufactured housing loans that they have outstanding.
Uh there seems to be an increase in their stake in Pilot, which is a gas station company in the United States. I think they call themselves a travel something something but it's it's gas stations. They sell gas. And so actually that's maybe a bit of a bet on on oil prices going back up. Um he did already have a substantial stake in Pilot.
increased that stake. Another piece in there is the short puts that he has outstanding. He has a very large position in short puts I believe on S&P's, Euro stocks and a few other uh world indexes. Uh they fell significantly in value along with the market falling and volatility going up. And so that of course is an issue.
Now I think those puts expire in February 2023 and they're actually positions that he began, I think, between 2004 and 2008. He sold a lot of those puts, and of course, that was a big discussion topic during the financial crisis cuz shortly after he sold them, uh the the market started tanking. And of course, now with this increase in implied vol and the risk of tomorrow, you know, the market did fall.
It's recovered quite a bit, and there is possibly a risk of the market falling again. And so, a large position in short puts may not be hugely attractive. We don't actually know what the strike prices are many of the details of these puts are at all. He did not take an impairment on his Occidental Petroleum uh preferred shares.
Uh the bonds at the moment are trading at I think less than 60 cents on the dollar. So, it's you know, there were some people saying that he would uh he would uh take a write-down on that, but he did not. And so, finally, we'll get to what the the Buffett indicator, which has been in the news a little bit recently.
So, Warren Buffett's favorite stock market indicator, at least he said this in the past, uh looks at the combined market capitalizations of a country's publicly traded stocks, and then divides that by the quarterly GDP. So, it's all of the companies in in the United States uh or at least the publicly traded companies, you take the market cap of that and divide it by quarterly gross domestic profit.
And so, investors and people like Warren Buffett use that to gauge whether the stock market is over or undervalued relative to the size of the economy. Now, it's not perfect, and in fact, it's flawed in many ways uh because it it GDP doesn't count the income earned by American companies overseas, of course, which which will matter.
There are also a lot of of companies that are listed in the United States that don't have operations in the United States. So, there are flaws, but this indicator surged before the dot-com burst and again before the financial crisis of 2008. And as of this week, it's hit a historic high of 179% of which reflects the the US stock market's rapid rebound since the coronavirus lockdown and the fall in GDP.
So, the US GDP has fallen 4.8% over the last quarter. And so, the reading of the Buffett indicator is at an all-time high, which would imply that he is possibly bearish and we'll we'll see later today when he when he speaks. And my circle of competence doesn't include the ability to predict interest rates a day from now or a year from now or 5 years from now.
Uh so, I say, can I function without knowing that? Same way as predicting what business is going to do or what the stock market's going to do. I can't do any of those things. But, that doesn't mean it I can't do well investing over time. And so, make sure that you subscribe and hit the bell button. Uh so, you'll be notified if I I might put out a video later today depending on what he has to say.
Um Charlie Munger won't be participating in today's event. It's an entirely live stream event. It's just uh it's just uh Warren Buffett and Greg Abel, who is Berkshire's vice chairman of non-insurance operations. So, that's all they'll be and a couple of journalists asking questions. Um Ajit Jain, who is another vice chairman and seen as a potential successor, is not scheduled.
And of course, another thing, you know, Buffett is almost 90 years old. Charlie Munger is almost 100 years old. And so, there's a lot of question In fact, uh for the last 20 years, there've been questions about who will succeed Warren Buffett. He gets by on a diet of hamburgers and diet Coke. Actually, I think regular Coke.
And he seems to be doing fine. Um but uh you know, we'll we'll we'll maybe hear something about who might succeed Buffett at Berkshire Hathaway and we'll see if he has any words of comfort or warning for stock market investors. So, it'll be an interesting an interesting thing to watch. So, see you guys later and have a great day. Bye.
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