Buffett's Berkshire doubles earnings

@CNNMoneyInvest May 4, 2012: 6:32 PM ET

NEW YORK (CNNMoney) -- Warren Buffett's Berkshire Hathaway posted first-quarter earnings Friday that doubled versus last year, buoyed by gains in its insurance businesses and derivatives holdings.

The company posted $3.25 billion in earnings, translating to $1,966 per Class A share, compared with $1.51 billion in the first quarter of last year.

Operating earnings, which exclude some investment and derivative gains, were $1,615 a share, coming up short of the $1,780 prediction from analysts surveyed by Thomson Reuters.

Berkshire (BRKA, Fortune 500) owns more than 80 companies, including insurer Geico, chemical company Lubrizol, railroad company Burlington Northern Santa Fe and MidAmerican Energy.

The firm also holds stakes in companies like Bank of America (BAC, Fortune 500), Kraft Foods (KFT, Fortune 500) and Johnson & Johnson (JNJ, Fortune 500), and it surprised some observers last year with a foray into the tech world, buying shares of Intel (INTC, Fortune 500), IBM (IBM, Fortune 500) and DirecTV (DTV, Fortune 500).

Berkshire booked gains from its insurance businesses, after the sector was battered early last year by disasters including the earthquake and tsunami in Japan. The firm's manufacturing, service and retail businesses were also a source of strength, as were its derivatives bets.

Class A shares closed at $121,950 Friday, while Class B (BRKB) shares finished at $80.94. Class B shares slipped 0.5% in after-hours trading.

Berkshire's shareholders will gather in Nebraska on Saturday for the company's annual meeting, where the so-called Oracle of Omaha will likely face questions about his health and his succession plans.

In a letter to shareholders last month, Buffett disclosed that he had been diagnosed with prostate cancer, though the 81-year-old claimed the condition "is not remotely life-threatening or even debilitating in any meaningful way." Additional tests, he added, didn't reveal incidence of cancer anywhere else in his body.

Buffett has yet to publicly reveal a succession plan, though he says he has already informed Berkshire's board about his preferred candidates. Upon his departure, Buffett's job will be divided between a CEO in charge of operations and one or more executives in charge of investments.

Buffett has said that two investment managers who recently joined the company, Todd Combs and Ted Weschler, "will be handling a few billion dollars in 2012, but they have the brains, judgment and character to manage our entire portfolio" when he and Berkshire vice chairman Charlie Munger are no longer running the company.

Ajit Jain, who heads the firm's reinsurance business, has been mentioned by Berkshire-watchers as a possible successor on the operations side.

Buffett's son, Howard, is in line to follow as chairman of Berkshire Hathaway upon his father's death, though Howard will not be involved in strategy or day-to-day decisions.

Berkshire shares had a rare down year in 2011, slipping 4.7%, even as the broader market stayed mostly flat. Over the past two decades, the company's stock has gained more than thirteen-fold, while the S&P 500 Index is up about three-fold. To top of page

Index Last Change % Change
Dow 17,804.80 26.65 0.15%
Nasdaq 4,765.38 16.98 0.36%
S&P 500 2,070.65 9.42 0.46%
Treasuries 2.18 -0.03 -1.27%
Data as of 10:49pm ET
Company Price Change % Change
Bank of America Corp... 17.62 0.09 0.51%
Apple Inc 111.78 -0.87 -0.77%
General Electric Co 25.62 0.48 1.91%
Intel Corp 36.37 -0.65 -1.76%
Microsoft Corp 47.66 0.14 0.29%
Data as of 4:04pm ET
Overnight Avg Rate Latest Change Last Week
30 yr fixed4.01%4.03%
15 yr fixed3.12%2.97%
5/1 ARM3.11%2.99%
30 yr refi4.04%4.09%
15 yr refi3.15%3.05%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.