Posted in: Fundamental analysis for experts

Berkshire Hathaway

Berkshire Hathaway Highlights 2015 meeting

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On saturday, May 2, 2015, there was an annual shareholders meeting of the company Berkshire Hathaway. The annual meetings of Berkshire Hathaway are always special. Thousands of thousands shareholders, analysts, reporters from all over the world  come each year to Omaha to see and hear the speaking of  Warren Buffet and Charlie Munger. They are all eager to know what Warren and Charlie has to say about the company Berkshire Hathaway, their view on the stock market and their view on the economy. In this article we at 101trading.co.uk will highlight a few things from that annual meeting that we think is important and answer the question if Berkshire Hathaway is still a good company to invest in.

Berkshire Hathaway annual meeting 2015

Foto taken during the Shareholder meeting with 40.000 shareholders

Berkshire Hathaway in the present and how will it look like in the future?

Between the period of 1964 and 2014 the stock price of Berkshire Hathaway have been increased over 1.800.000% vs 2300% of the S&P500. At the moment Berkshire Hathaway is doing well. However one the company that Berkshire Hathaway own has been in bad publicity. The name of that company is Clayton Homes. Clayton Homes was investigated by The Seattle Times and The Center for Public Integrity (CPI). In their research The Seattle Times and CPI have documented how the Clayton Homes has used predatory sales practices, exorbitant fees and home-loan interest rates that can exceed 15 percent. Because Clayton’s mobile homes often dwindle in value, borrowers find themselves trapped, unable to sell or refinance due to the punishing lending terms.Warren Buffet defended Clayton Homes by saying that believes that the investigation made a mistake and mistook gross margins for actual profit margins. Therefore the investigation of  the Seattle Times and CPI are not accurated. Warren Buffet says that the facts are on Berkshire Hathaway side and the case will be solved.

Clayton Homes is just one of the companies that Berkshire Hathaway own in their portfolio. Warren Buffet and Charlie Munger strongly believes in their portfolio of investment that they have in Berkshire Hathaway. For example Warren believes that Coca Cola company will sell a lot more beverages in the future and Charlie Munger believes in IBM because that company is adapting really well in the changing computing industry.

What will happen in the future?

  1. Berkshire Hathaway is eager to acquire a European company in the next 5 years
  2. The person who is going to follow up Warren Buffet must have skill in investment world as well in the business world.  Warren Buffett says experience in operations is very important. “I would not want to put someone in charge of Berkshire with only investing experience and not any operational experience,” he adds. Mr. Buffett says he’s learned a lot through operations that he wouldn’t have learned if he stayed in investments all his life. If you had someone who had the dual experience in both, that would be optimal, he adds. He compliments Berkshire by saying some of the conglomerate’s managers also know a lot about investing.
  3. Berkshire Hathaway  will keep on improving their own companies and are still in look for acquiring new companies.

Buy more , sell or hold ?

Based on the company past result and the annual report of 2014. We would say buy more stocks of Berkshire Hathaway stocks A and B for the long term. If you are in for the short term profit then trade in Berkshire Hathaway CFDs here.

Check the video below and see what shareholders think and how they experience the shareholders meeting of Berkshire Hathaway.

(resources that were used for writing this article : Wall Street Journal , Fortune, Business Insider UK , Seatle Times)

Greece Euro

Greece Euro exit nearby or still far away?

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With the recent development in Greece Euro situation many are asking this question: Will Greece stay in EU or not? In this article you will find our thoughts about the Greece situation and how we are thinking on to set up a trading plan for that.

Greece Euro case: good or bad new development?

On friday 24th of April Jeroen Dijselbloem said in the Greece Euro situation that there will be no funding for Greece until they have met requirements that’s been set by the Eu. Yesterday on the 27th April the prime minister of Greece Tsipras announced that the negotiation team has been reformed. Greece financial minister Varoufakis got replaced by Tsakalotos.

The markets reacted positive on those development in the Greece Euro case. We have to mention that the markets were already in a good mood because of the good earnings from companies that publicised their first quarter results.

Today the 28th of April 2015 the Greece prime minister Tsipras announced that if the bailout terms are not fair in Greece Eu situation, then the prime minister have to held a referendum.  This way the citizens of Greece can choose if they want to support the EU bail out deal or not. (sources : Financial Times)

What do we at 101trading.co.uk expect?

Its difficult to say of what to expect. In the Greece Euro case we think that both parties will strike some kind of a deal. We have noticed that Greece have changed their attitude a little bit towards the EU since the Greece election. According to the dutch news paper “de volkskrant” Tsipras is willing to break a few of his election promises. (source: volkskrant)

We believe that EU won’t let a Grexit happend because of the following reasons:

  1. If a greeks exit happens , the country will go broke and there is no view on how Greece will payback the loan to the EU and IMF.
  2. Eu doesn’t want to drive Greece into the hands of Putin
  3. Its doesn’t want to endanger the euro currency

Now its up to EU to loose up a little bit and offer Greece a better deal.

How do we plan to make money?

On judgement day of Greece we will take a small position of cfds and options and create a strangle.

 

Alibaba stock: Good or no good?

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After their IPO on 19th September 2014 the price of Alibaba stock was started at $92,30. And reached the highest price of $120 on the 14th of November 2014. From there the stock price of Alibaba declined to $82,15 today 21th of April when writing this article.

 

What causes the declining?

Well since Alibaba’s highest pike on the 14th of November, the company have been receiving critics from Chinese regulators on their e-commerce activities, forecasts that missed estimates and Alibaba is also currently facing slow growth in sales. And don’t forget the Chinese e-commerce market is growing that fast as many are expecting it.

 

What to do now?

Alibaba is still facing many challenges; they are still testing the waters of the international markets. Jack Ma announce a while back that Alibaba is going to focus a lot more on making money international then only on China. In the long term might succeed in this but in the short term its going to be difficult. Having Amazon as a competitor…

On the other hand Alibaba profits are still rising and sales are still good despite it didn’t met the expectations of many analysts. And Alibaba is making big investments in small tech us companies that could give Alibaba a good return on their investment. One the start up company that Alibaba have invested in is SnapChat.

We at TradeAndInvest101.com are thinking on holding Alibaba stocks with put options. We might go in the swing trade with CFD’s on Alibaba stocks.

Alibaba stock Price Movement 21-04-2015

As you can see from the screenshot. From march till now the Alibaba stock price movement has been and still is in a indecisive trend. You might have notice the double inside bar which indicates that the indecisive trend will continue. On 7th may 2015  Alibaba company will  announce their first quarter results. We think that day is the day that might end the indecisive trend of Alibaba stock price movement. If the results are good and Alibaba stock price close above 85 dollars we might get a uptrend of Alibaba. And if the results are bad and the stock price of Alibaba closes below 80 dollars we might get a downtrend of Alibaba.