Buffett Laments Lack of Good Investments Even As Berkshire Hathaway Reports Record Income In 2021

Warren Buffett's Berkshire Hathaway Inc (NYSE: BRK-A) on Saturday announced its fourth-quarter earnings. 

What Happened: Berkshire's quarterly operating income rose 45% to $7.29 billion, or approximately $4,931 per Class A share, from $5.02 billion a year earlier.

Net income rose 11% to $39.65 billion from $35.84 billion, with both totals reflecting large gains from stocks such as Apple Inc. AAPL which alone represents 46% of the $350.7 billion of stocks that Berkshire owns.

In 2021, operating income rose 25% to $27.46 billion, topping the previous record $24.78 billion set in 2018, while net income more than doubled to $89.8 billion.

The company’s share price rose 30% in 2021, topping the 29% gain of the Standard & Poor's 500 including dividends, and ending two years of significant underperformance relative to that index.

Berkshire has signaled renewed confidence in its stock, repurchasing $6.9 billion in the quarter, and boosting total buybacks in 2021 to a record $27 billion. 

In his annual shareholder letter, Buffett said that Berkshire has repurchased another $1.2 billion of stock in 2022.

Buffet's Commentary: Buffet called out a spike in deceptive adjustments to corporate earnings. He also complained about a lack of stock-market bargains, touted four of Berkshire's key businesses, underlined his company's scale and tax contributions, and eulogized the chief of one of Berkshire's subsidiaries.

Buffett has said that he will stick to his knitting, bemoaning the lack of good investment opportunities for Berkshire Hathaway as it sits on a massive pile of cash even after repurchasing a huge amount of its stock.

He has said that Berkshire’s emphasis on investing in strong businesses and stocks benefits investors with a similar long-term focus.

"People who are comfortable with their investments will, on average, achieve better results than those who are motivated by ever-changing headlines, chatter, and promises," Buffett wrote.

Photo: Fortune Live Media on flickr