Warren Buffett, CEO and Chairman of Berkshire Hathaway.
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Stocks in five trading companies backed by Warren Buffett Berkshire Hathawayportfolio— ITOCHU Corporation, Marubeni Corporation, Mitsubishi Corporation, Mitsui & Co., Ltd.and Sumitomo Corporation — surge, growing 30% by 2024.
The five companies are also among the largest of Japan's so-called general trading companies, in which Berkshire Hathaway made big bets in 2020 and increased its stake in subsequent years.
Japanese trading companies engage in the trade of a variety of products and materials and play an important role in Japan's economic growth.
Increasingly, they operate as global venture capital and private equity firms — and for Buffett, these diversifications may be part of the appeal.
Berkshire Hathaway's market capitalization exceeded $1 trillion on Wednesday, becoming the first non-tech company in the United States to reach this milestone.
As of Thursday morning, the company had a market capitalization of $994.58 billion. Shares of the Omaha, Nebraska-based conglomerate have soared 30.3% in 2024, well ahead of the S&P 500's gain of 17.24%.
Although it holds Japanese and Chinese stocks, it invests primarily in U.S. companies, with Apple, American Express, Bank of America and Coca-Cola making up the majority of its portfolio.
The following are Asian companies in which Berkshire has invested:
Japan's largest trading company
Mitsubishi Corporation, ITOCHU Corporation, Mitsui & Co., Ltd., Marubeni Corporation and Sumitomo Corporation According to LSEG, their share prices will soar 33.3%, 29.8%, 14.6%, 9% and 10.9% respectively by 2024.
Berkshire Hathaway said in a statement that it increased its stake in the five largest trading companies to about 9%. 2023 Annual Reportup from 6-7% in 2022.
“Berkshire continues to hold passive and long-term interests in five large Japanese companies, each of which operates in a highly diversified manner that bears some resemblance to the way Berkshire itself operates,” the company wrote.
The company noted that all five companies “follow shareholder-friendly policies that are significantly superior to those customary in the United States.”
“All five companies reduced the number of shares outstanding at attractive prices.”
BYD, China’s largest electric vehicle manufacturer
Berkshire was an early investor in Chinese electric car maker BYD. In 2008, the company first purchased about 225 million shares for about $230 million.
The bet has proven very profitable as the market for electric vehicles explodes in China and elsewhere.
BYD's Hong Kong-listed shares have risen about 6% this year, while its Shenzhen-listed shares have soared nearly 19%.
However, the investment company has been reducing its stake in BYD and currently holds only 4.94% of the shares, according to the London Stock Exchange. Nomura Securities analyst Joel Ying pointed out in July that fierce competition in China's electric vehicle market is one of the possible reasons affecting Berkshire's decision.