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BUSINESS Saturday 9 November 2019
A25

As Buffett seeks big acquisition, Berkshire trails S&P

By JOSH FUNK 2009-2019," Rolfe wrote to
Associated Press investors in his Wedgewood
OMAHA, Neb. (AP) — Partners fund.
Three-quarters of the way Rolfe said Buffett should
through 2019, Warren Buf- have bet heavily on a
fett's conglomerate Berk- handful of stocks he knows
shire Hathaway is trailing well — such as Visa and
the renowned investor's fa- Mastercard — when he
vorite benchmark, the S&P couldn't find major acqui-
500 — as it's done over the sitions during the past de-
past decade. cade. "Buffett is incredibly
Besides having a large well-versed in the payments
stock portfolio, Berkshire processing industry given
owns an odd mix of com- his half-century knowledge
panies, some well-known in longtime holding Ameri-
such as the Geico insur- can Express. These two
ance company and the stocks should have been
Dairy Queen restaurants, layups for Buffett," Rolfe
and other far less familiar said about Visa and Mas-
names such as MidAmeri- tercard. Both shares are up
can Energy and Iscar Met- more than 150% over the
alworking. The assortment past five years.
produces steady profits but To be sure, the growth
not significant growth, and In this May 5, 2019, file photo Warren Buffett, Chairman and CEO of Berkshire Hathaway, ges- in Berkshire's stock price
occasionally needs some tures during a game of bridge following the annual Berkshire Hathaway shareholders meeting in since 1965 has outpaced
new blood in order to out- Omaha, Neb. the Standard & Poor's 500
perform the market. Associated Press index in all but 17 years to
Finding that next big ac- where Buffett earned his a number of profitable longtime Buffett backers. deliver a compounded an-
quisition has been hard reputation, he's gotten deals — Berkshire Hatha- Investor David Rolfe sold off nual return of 20.5% overall
to come by for Buffett, good returns investing in way has delivered a 353% his firm's roughly $100 million compared to the market's
one reason he says Berk- bellwethers such as Apple return while the S&P 500 in- stake in Berkshire during this 9.7% through 2018. But Buf-
shire hasn't kept up with and Bank of America, but dex has delivered 468% in year. Rolfe expressed frus- fett has repeatedly warned
the overall market. Buffett a big investment in Kraft gains when dividends are tration with Buffett's invest- investors not to expect that
says low interest rates have Heinz has turned sour. included. This year alone, ment choices and inability type of return going for-
made it easier for other in- While many people view Berkshire's stock is up just 8% to find productive uses for ward because Berkshire's
vestors to borrow money Buffett as the world's pre- compared to the total mar- Berkshire's cash. size makes it nearly impos-
and bid up the prices of eminent investor, in the ket's 25% gain. "Thumb-sucking has not sible to keep growing sig-
acquisition targets. years since the financial That performance has test- cut the Heinz mustard dur- nificantly faster than the
On the investment side, crisis — when Buffett made ed the patience of some ing the Great Bull Market of overall market. q

Stocks edge lower as investors listen for trade deal clues

By DAMIAN J. TROISE yield on the 10-year Trea- day, its second record this
Associated Press sury fell to 1.91% from 1.92% week.
NEW YORK (AP) — U.S. late Thursday. ROARING MOUSE: Walt Dis-
stocks fell in early trading KEEPING SCORE: The S&P ney rose 4.4% after handily
Friday as investors grew 500 index fell 0.1% as of beating Wall Street's fiscal
more uncertain about pros- 10:16 a.m. Eastern time. The fourth-quarter profit fore-
pects for a trade deal be- Dow Jones Industrial Aver- casts on surging revenue
tween the U.S. and China. age fell 41 points, or 0.1%, because of films including
The market is still poised for to 27,632. The Nasdaq fell "The Lion King" and "Toy
a winning week and major 0.1%. The Russell 2000 index Story 4". The company also
indexes were just below re- of smaller company stocks said it received a positive
cord highs set a day earlier. was little change. Europe- response from a test of its
Wall Street has been cheer- an and Asian markets fell. planned streaming service,
ing the latest push to sign WEEK OF RECORDS: The S&P Disney Plus.
an agreement before 500 had another solid week WIDENING GAP: The retailer
more costly tariffs on a In this Oct. 29, 2019, file photo specialist Gregg Maloney, left, of record-setting days. The fell 6.3% after slashing its
wide range of consumer and trader John Panin work on the floor of the New York Stock index closed at an all-time profit forecast for the year
products go into effect on Exchange. high of 3,085.18 on Thurs- and announcing the resig-
Dec. 15. Those cheers were Associated Press day, its second record- nation of CEO Art Peck. The
muffled late Thursday over also fell. Many of the com- among communications setting day of the week. It company has been strug-
reports that U.S. officials are panies in the sector rely on companies with solid gains is also on track for its fifth gling to turn around a long-
still deliberating the extent China for sales and supplies, following surprisingly good straight week of gains. standing sales slump and
of easing tariffs if talks prog- which make them more earnings. Several other The Dow also had a solid is splitting into two publicly
ress. Energy stocks were sensitive to swings in trade companies rose following week and reached a re- traded companies, one for
among the biggest declin- war sentiment. Broadcom solid earnings reports. En- cord of 27,674.80 on Thurs- its Old Navy brand and an-
ers in the early going as the fell 1.3% and Micron shed ergy drink maker Monster day. That was its third other for the Gap, Banana
price of oil dipped 1.6%. 1.6%. Banks also slipped. Beverage rose 6.3% and record-setting day of the Republic and its lesser
ConocoPhillips fell 1.9%. Principal Financial fell 1.7%. Bookings Holdings gained week. The Nasdaq hit a known brands like Athleta,
Technology companies Walt Disney was a standout 5.4%. Bond prices rose. The record of 8,434.68 on Tues- Intermix and Hill City.q