Berkshire Hathaway earnings grow to $11B, cash hoard at $189B

investmentnews.com:

Berkshire Hathaway Inc.’s cash pile hit yet another record as billionaire investor Warren Buffett confronted a dearth of big-ticket deals. Operating earnings also rose, buoyed by his collection of insurance businesses. 

The firm’s hoard increased to $189 billion at the end of the first quarter, topping the record it set at year-end. The company also reported first-quarter operating earnings of $11.2 billion, versus $8.07 billion for the same period a year earlier.

Buffett, 93, has long decried a lack of meaningful deals that he said would give the firm a shot at “eye-popping” results. Even as the company ramped up acquisitions in recent years, including an $11.6 billion deal to buy Alleghany Corp. and its purchase of shares in Occidental Petroleum Corp., Berkshire has struggled to find sizable deals. That’s left Buffett with more cash — what he called an unrivaled mountain of capital — than he and his investing deputies could quickly deploy.

As Berkshire’s annual meeting kicked off in Omaha on Saturday, Buffett said that “it’s a fair assumption” that its cash pile will hit $200 billion at end of this quarter with few opportunities for needle-moving acquisitions on the horizon. 

“We’d love to spend it, but we won’t spend it unless we think we’re doing something that has very little risk and can make us a lot of money,” he told the crowd of thousands. The company hopes for an “occasional big opportunity,” he added, later noting that it’s looking at an investment in Canada. 

Still, having such a vast sum of cash in an increasingly “complicated and intertwined” world where more can go wrong can allow the firm to step in when opportunities present themselves, Buffett said. Berkshire wants to be ready to act when that happens,