Yahoo Finance

Berkshire Hathaway's annual shareholder meeting is on deck this weekend. Here for a closer look at its holdings is Yahoo Finance's head of news, Miles Udland, here with us in the studio. Miles, um, Yeah. you know, we always look ahead to this meeting to get more insight into what Berkshire's holding, what Warren Buffett is thinking, but talk to us about the top holdings and kind of as a scene setter if you will.

I mean, it's really just a story about Apple. I mean, we got the Well, we got the earnings last night, and the company comes out, they say it's going to be almost a billion dollar headwind, um, in the current quarter, and they wouldn't go beyond that. So, you know, stock's down today. Buffett's largest position, even despite the what, two-thirds uh that he's sold two-thirds of the position over the last couple of years, so down significantly, but still the largest holding within Berkshire's equity portfolio. So, certainly a lot of questions there. There'll be a lot of questions about Berkshire's overall tariff exposure. I think what Buffett himself makes of tariffs because there, um, you know, there's a Fortune up-ed, I believe it was, from the early 2000s where he was like, yeah, you know, uh, China entered WTO, and we don't really have any domestic manufacturing. Should probably look at that. Um, and maybe tariffs aren't all bad, and I think I would imagine questions along those lines and Buffett giving answers along the lines of it's not necessarily the uh diagnosis here. It's some of the approach, which I think is a common theme when it comes to discussing tariffs. Um, so we'll certainly get some of that, and uh, you know, I think what we heard from Apple last night is basically kind of why he is paired the position, but also why he still owns it. Company comes out, you know, $100 billion stock buyback, they raise the dividend again, so, you know, Berkshire's getting a ton of cash, and they're getting a larger share of Apple just mechanically by owning the number of shares they do, and you know, the buyback cancels some of those out. So, um, that, I think, on the equity portfolio is the main line of questioning, though, as we get towards the end of the line for Buffett, I think that portion of Berkshire Hathaway just becomes less interesting.

What about that cash pile he's sitting on, more than $300 billion? The fact that he's sitting on that, are there broader lessons to learn for investors that we should take away from that, Miles?

Uh, I mean, I think the lessons are pretty clear. He didn't have a lot of other uses for that cash, and, you know, a lot of its parked in T bills. So, you're getting depending on the tenor, 2, 3, 4%, um, wherever you're parking that, and that's not nothing at $300 million worth of cash. So, I think that's certainly part of the conversation for Berkshire. Um, and look, the the problem that Buffett and Berkshire have had, uh, and this is never going to change now, whether Warren's running the company or not, is they're now too big to do a lot of things that make an impact on the overall portfolio. Like, they came into Apple. It's going to be nine years since they first initiated a position, and at that point in time, you might know better than I what the market cap of the company was. It was smaller, but it was still among the largest in the market at that time, has been among the largest in the world for the entire nine-year period, and it's kind of the only company big enough that can handle Berkshire coming in with huge buys on a very regular basis that doesn't, you know, and that money on its own doesn't push around the price of the stock because that's the problem when you're sitting on $300 billion in cash. They haven't bought a lot of companies outright. They did the Pilot Flying J deal a few years ago, but they haven't really been acquisitive with the money. So, sure, are they going to buy Coke outright? I don't I don't see that happening. They're going to buy American Express? I don't see that kind of thing. I could be wrong, but it just has not been the Berkshire Hathaway, um, really since the Precision Castparts deal in 2015. They haven't done anything big. So, what are they going to buy? I mean, they bought Japan trading houses. They could go buy shares of something else, but when you have that amount of capital sitting there, um, Buffett clearly doesn't see anything that he loves that he wants to deploy new capital into. So, you see that cap, you know, you see that cash pile grow. Um, the interesting thing about this timing always is that we'll get the 13F from Berkshire uh in the middle of the month, so about a week and a half from now, so he may be doing stuff like this happened with Apple. He did the annual meeting, didn't say he bought Apple. Week and a half later, it's like, uh, I bought a ton of Apple, about 10 million shares of Apple. So, we might have a situation like that, but um, ultimately, I think it's just a portfolio that reflects an investor who doesn't see a lot he likes, and it's new money. You know, we talk on the shows a lot with portfolio managers who are in the market. They have to do something, right? So, it's like, do you like this more or less than your other options? For Buffett, it's new cash. So, it's very hard to go from zero to something in this kind of environment, no matter who you are and whatever you're looking at.

All right, busy weekend for you, Miles. Thank you. Appreciate it.

Yep.