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Hedge Funds Pouring Money into Berkshire Hathaway (NYSE:BRK.B)
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Hedge Funds Pouring Money into Berkshire Hathaway (NYSE:BRK.B)

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Berkshire Hathaway’s Class B shares have found more space in hedge fund portfolios during the last quarter. At times of macroeconomic uncertainty, Berkshire’s diversified line of businesses seems to provide a much-needed safeguard to investors.

Warren Buffett’s multinational conglomerate, Berkshire Hathaway (BRK.B), is attracting hedge funds, which are pouring tons of money into its Class B shares.

TipRanks’ Hedge Fund Trading Activity tool shows that confidence in Berkshire Hathaway’s Class B shares is currently Very Positive, as 83 hedge funds increased their cumulative holdings of BRK.B stock by an impressive 5.3 million shares in the last quarter.

What Exactly does Berkshire Hathaway Do?

Berkshire is headed by the Oracle of Omaha, and undoubtedly, it is a combination of several successful businesses. Berkshire invests in and owns a multitude of businesses, including insurance, energy, manufacturing, rail transportation, and retail. Berkshire also has minority stakes in several companies, like Buffett’s favorite Occidental Petroleum (OXY).

Why Does Berkshire Hathaway Have 2 Classes of Shares?

Berkshire initially issued only one stock, its Class A shares (BRK.A). These were too pricey and made it difficult for smaller investors to gain exposure to the company. Hence, in 1996, Buffett introduced another cheaper stock, Class B shares, to increase affordability.

Class A stock has a lower float compared to Class B stock and is more expensive. Plus, Class A stock commands a higher voting power and is convertible to up to 1500 shares of Class B at the option of the holder.

As of July 26, 2022, there are only 599,924 shares of Class A as against 1,301,126,370 shares of Class B outstanding.

Is Berkshire Hathaway Class B Stock a Good Investment?

Indeed, under the stewardship of Buffett and partner Charlie Munger, Berkshire Hathaway has been a good investment for shareholders. Its diversified businesses provide a safeguard during times of economic uncertainty.

Berkshire Hathaway exceeded expectations in its Q2FY22 results. The adjusted earnings of $4.21 per share were exceeded by $0.87 per share. Similarly, revenues of $76.18 billion were beaten by $3.67 billion.

Moreover, retail investors continue loading up the stock. TipRanks’ Stock Investors tool shows that investor sentiment is currently Positive on Berkshire Hathaway Class B shares, with 2.3% of portfolios tracked by TipRanks increasing their exposure to BRK.B stock during the last 30 days.

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