Berkshire profit doubles in Q3, buys back stocks

Breakfast Briefing Sorrell and Spanier

Breakfast Briefing Sorrell and Spanier

Class A shares closed at $308,411.01 per share and Class B shares at $206.57 on Friday.

Meanwhile, insurance underwriting income was $441m in the third quarter, compared with a $1.4bn loss in the same three months the year before.

A new company policy in July gave Buffett more leeway to buy back Berkshire's stock, and he repurchased US$928 million worth in the quarter.

Q3 net earnings per class A share of $11,280 exceeds consensus of $3,820; compares with $2,473 a year ago.

The Omaha-based company's revenue grew to $63.45 billion in the quarter, which was up from $59.5 billion previous year.

Berkshire Hathaway shareholders walk by a video screen at the company's annual meeting in Omaha May 4, 2013. Buffett said the rule could lead to "wild and capricious" results and can mislead investors, who should look at operating profit instead.

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Berkshire warned that insurance losses due to Hurricane Michael are now estimated in the $350 million to $550 million range for the fourth quarter.

Operating earnings for the multinational conglomerate, whose earning power is largely concentrated in the insurance sector, jumped to $6.88 million from $3.44 million in the year-ago period. The year prior included major losses due to three United States hurricanes and an quake in Mexico. Most of the gains came from its massive investment portfolio, though the value of its holdings are down slightly. New accounting rules that took effect this year forced Berkshire to change the way it records the value of its investments. And the company's book value per Class A share was $228,712 on September 30, higher than $217,677 one quarter ago.

"This will send a strong signal in equity markets", Shanahan said.

The strong result gives Buffett more cash to deploy even as the well-known bargain-hunter has admitted struggling to find a place to put those earnings to work and resorted to buying back almost $1 billion in his own company's stock in the latest quarter.

Bethshire Hathaway, based in Omaha, Neb., owns a variety of companies, including insurer Geico, railroad Burlington Northern Santa Fe and consumer brands like Duracell, Dairy Queen and paint maker Benjamin Moore as well as newspapers, including the hometown Omaha Herald. Its insurance and utility businesses typically account for more than half of the company's net income. The company also has investments in companies such as Apple, American Express, Coca-Cola and Wells Fargo.

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