Warren Buffett and Greg Abel during the Berkshire Hathaway Annual Shareholders Meeting in Omaha, Nebraska on May 4, 2024.
CNBC
Warren Buffett has been mum about tariffs and the recent market turmoil, but will finally speak his mind when the 94-year-old investment legend kicks off Berkshire Hathaway‘s annual shareholder meeting on Saturday.
Tens of thousands of rapt shareholders will descend on Omaha, Nebraska this weekend for the annual gathering dubbed “Woodstock for Capitalists.” This year’s meeting marks the 60th anniversary of Buffett leading the company, and is the second without Buffett’s long-time partner Charlie Munger, who died in late 2023.
The biggest event in the Cornhusker State next to a Nebraska-Oklahoma football game, this year’s meeting comes as markets have turned uncertain after President Donald Trump’s aggressive rollout of the highest tariffs on imports in generations. (Many were suspended for 90 days afterward.) Wall Street economists left and right are sounding the alarms that a recession may be in the offing, as recent data pointed to signs of economic weakening.
“Because Berkshire owns so many businesses, they’re basically on the front lines of everything in terms of the economy falling off. Is it even worse than what the numbers are already showing?” said Steve Check, founder of Check Capital Management, which counts Berkshire as its largest holding. “I hope, more than anything, that he speaks out against the way tariffs have been done. Everyone is looking for what Warren Buffett has to say.”
Investors’ north star
The “Oracle of Omaha” may have already let his actions do the talking. Berkshire has sold more stock than it’s bought for nine straight quarters, dumping more than $134 billion worth in 2024. That was mainly due to reductions in Berkshire’s two largest equity holdings — Apple and Bank of America. As a result of the selling spree, by December Berkshire’s enormous pile of cash had grown to yet another record, at $334.2 billion.
The world is eager to hear if Buffett, the most famous advocate of value investing, used the April market meltdown to hunt for bargains and lay the groundwork for deals. Although Buffett doesn’t make predictions of short-term market direction, investors will listen closely for any signals of his continued confidence in the U.S. economy — despite the tariff shock.
“I think the big question on everyone’s mind is what will Warren do with the pile of cash that they are sitting on and, more specifically, when can it be deployed, as he can help investors gauge when the all clear sign is lit,” said David Wagner, a portfolio manager at Aptus Capital Advisors and a Berkshire shareholder. Many investors, he noted, “tend to view Warren as the north star.”
Buffett will make a few introductory remarks at 9am ET Saturday, followed by an hours-long question-and- answer panel. Buffett’s designated successor, Greg Abel, and Berkshire’s insurance chief, Ajit Jain, will join Buffett on stage in the morning, with Buffett and Abel alone in the afternoon. The Q&A session will be broadcast on CNBC and webcast in English and Mandarin.
Big Apple question
Shareholders are also curious for Buffett to explain his motivation in slashing his longtime Apple stake. After a head-turning selling spree for four quarters in a row, Berkshire’s Apple holding has stayed at an even 300 million shares since the end of September, leading many to speculate that Buffett is done selling the stock for the time being.
At last year’s annual meeting, Buffett suggested that the sale was for tax reasons following sizable gains. He also implied that selling down Apple could be tied to his wanting to avoid a higher tax bill in the future if rates went higher to fund the yawning U.S. fiscal deficit. With a change in government in Washington, shareholders want to hear Buffett’s reasoning today.
“You can’t use that explanation anymore because it clearly does not apply,” said David Kass, a finance professor at the University of Maryland. “If he sold more, it would indicate that he probably felt it was fully valued, or Warren Buffett being the genius that he is, he was able to see ahead at some of the risks that could face Apple, in case there’s a trade war and tariffs.”
Berkshire’s first-quarter earnings report, due Saturday morning, will show the conglomerate’s top equity holdings, which could give investors a hint as to whether the Apple stake was adjusted again.
China’s electric car price war shows little sign of letting up, putting more pressure on companies to survive. Tesla ‘s China sales fell by 15% in May from a year ago, China Passenger Car Association data showed. BYD , in contrast, reported a 14% year-on-year sales increase as it held onto first place in the market by volume, but even it had to announce sharp discounts as sales growth slowed from April’s pace. “We expect additional price competition in the coming weeks as BYD is still lagging behind its sales target,” said a team of analyst led by CLSA analyst Xiao Feng in a report Wednesday. While the analysts still have a high conviction, with an outperform rating on BYD’s Hong Kong-listed shares, they see Geely as the ”best positioned” for investors as it is striking the optimal balance with its internal business structure and competing on vehicle price. CLSA has a price target of 483 Hong Kong dollars ($61.55) on BYD, and a 23 HKD target on Geely, also listed in Hong Kong. That’s upside of nearly 20%, and 28%, respectively, from Friday’s close. Geely is a large conglomerate with electric vehicle brands Galaxy, Zeekr and Lynk and Co., which share some of the same tech and manufacturing systems. “Geely’s Galaxy NEV brand has successfully targeted BYD’s popular models with better specs and lower prices,” Macquarie analysts said in a report Thursday, citing a call with an auto dealer who manages dealerships for BYD, Geely and Xpeng in the relatively affluent Suzhou region near Shanghai. “The expert believes Geely’s success will continue, as it is still ramping up new models to compete with BYD’s entire model line-up,” the report said. The Macquarie analysts have a price target of 22 HKD on Geely and rate the stock outperform. But they like U.S.-listed electric car startup Xpeng even more, with a $24 price target. Xpeng is likely to benefit from near-term market share gains given its advanced driver assist system and upcoming car models, the analysts said. The latest delivery data showed Xpeng delivered more than 30,000 cars in May for a seventh straight month, a rare feat among its immediate peers. The company last month also launched a new car under its lower-priced Mona brand. Among publicly listed new energy vehicle companies, a category that includes battery-only and hybrid-powered cars, Leapmotor and Li Auto have proven relatively stable, each with deliveries of more than 40,000 vehicles in May. Both companies have Hong Kong listings, while Li Auto also trades in New York. “Through a continuously expanding product matrix and cost-effective models, Leapmotor has achieved a stable market share in the Chinese mass EV market and has strong growth potential,” the CLSA analysts said. They have a price target of 72 HKD, or more than 30% upside from Friday’s close. Leapmotor reported a net loss in the first quarter, however, compared with profit in the fourth quarter. But Li Auto maintained profitability in the first quarter, according to results released on May 29. “We still see ample upside as a better-than-feared 1Q should inspire investor conviction about sequential recovery in 2Q,” Morgan Stanley analysts said in a May 29 report. They have a price target of $36, for upside of more than 20% from Thursday’s close. “The management team has found its pace for a steady and solid comeback, underpinning a more material resurgence of volume/margins into 2H25 amid new model launches,” the analysts added. “Li Auto’s premium model lineup can steer clear of the fierce pricing competition in the mass market.” Li Auto is best known for its SUVs that come with a gas tank for extending the battery’s driving range. Prices start around 244,000 yuan ($34,000). Industry giant BYD in contrast now sells some cars at 55,800 yuan, with most models falling in the 100,000 yuan to 200,000 yuan price range. The company also has a high-end sub-brand called Yangwang, which prices cars at well above 1 million yuan. Analysts that still like the stock see potential in BYD’s overseas expansion. The narrative on BYD among European investors “sounds more optimistic,” contrary to more cautious sentiment in China following the automaker’s recent price promotions, JPMorgan’s Nick Lai, head of Asia Pacific auto research said in a report Wednesday. Lai and his team also cited conversations with senior BYD management in London in the last week. “All in all, we retain our long-term positive view on the company and believe the (earnings) contribution from the overseas market and BYD’s premium portfolio will increasingly play an important role,” the JPMorgan analysts said. “We estimate that BYD’s overseas business and premium brands will together contribute over 40% of its vehicle earnings in 2025 (up from 20-25% last year) even though they account for only about 20% of volume.” The analysts rate BYD overweight, with a price target of 600 HKD. However, the risk of a flood of cheap cars into markets such as Europe have prompted tariff increases. In China, official commentary is also sounding the alarm about excessive competition. “We believe an end to the current price war will come down to simple economics,” the Macquarie analysts said, pointing out that production capacity for both electric and traditional vehicles is more than 50 million units, well above the annual wholesale volume of 25 million to 27 million vehicles. “Thus, the market will likely stabilize either via higher demand or right-sized capacity and consolidation,” the analysts said. “We believe this may take at least another three to five years.” — CNBC’s Michael Bloom contributed to this report.
Check out the companies making the biggest moves midday: Petco Health — The retailer slumped 22% after losing 4 cents per share in the fiscal first quarter, twice the 2-cent loss that analysts had estimated, based on FactSet data. Revenue of $1.49 billion missed the Street’s $1.50 billion consensus, while same-store sales dropped 1.3%, worse than the 0.6% decline forecast by analysts. Tesla — The EV maker added more than 6%, a day after plunging 14% as CEO Elon Musk and President Donald Trump publicly feuded . Broadcom — Shares of the chipmaker dipped 2.7% on lackluster free cash flow for the second quarter. Broadcom reported free cash flow of $6.41 billion. Analysts surveyed by FactSet were looking for $6.98 billion. Still, several analysts covering the stock raised their price targets. ABM Industries — Shares fell 11% after the facilities management company reported mixed results for its second quarter. Its adjusted earnings of 86 per share was in line with expectations, while its revenue of $2.11 billion topped the FactSet consensus estimate of $2.06 billion. ABM Industries also reiterated its earnings guidance for the year. Circle Internet Group — The stablecoin company popped 38%, following its Thursday debut on the New York Stock Exchange. Circle soared 168% in its first day of trading . Lululemon — The athleisure company pulled back 20% after its second-quarter outlook missed analyst estimates. CFO Meghan Frank also said on a call that Lululemon plans on taking “strategic price increases, looking item by item across our assortment” to mitigate the impact of higher tariffs. G-III Apparel Group — The apparel company tumbled 15% on much weaker-than-expected earnings guidance for the second quarter. The company sees earnings per share in a range of 2 cents to 12 cents. Analysts had estimated earnings of around 48 cents per share, according to FactSet. DocuSign — The electronic signature stock plunged 19% after the company cut its full-year billings forecast. Billings for the fiscal first quarter also came in lower than expected. Braze — Shares of the customer engagement platforms provider fell 13% on disappointing guidance. Braze guided for second-quarter adjusted earnings of 2 to 3 cents per share. Analysts polled by FactSet called for 9 cents per share. Its first-quarter results beat estimates. Quanex Building Products — The maker of windows and doors and other construction materials soared 18%, the most since September, after earning an adjusted 60 cents per share in its fiscal second quarter versus analysts’ consensus estimate of 47 cents, on revenue of $452 million against the Street’s $439 million, FactSet data showed. Adjusted EBITDA also topped forecasts. Samsara — Shares shed 5% after the software company projected revenue growth to slow. Samsara guided for second-quarter revenue to increase between $371 million and $373 million, up from the $367 million in the first quarter. That would be a slowdown on both a sequential and year-over-year basis. Solaris Energy Infrastructure — The oil and natural gas equipment and service provider rallied 10% after Barclays initiated research coverage with an overweight rating and $42 price target. “Solaris is the leader in distributed power with almost 2 GW of capacity to be added by 2027 with 67% allocated towards data centers on long term contracts,” the bank said.
A sign in German that reads “part of the UBS group” in Basel on May 5, 2025.
Fabrice Coffrini | AFP | Getty Images
The Swiss government on Friday proposed strict new capital rules that would require banking giant UBS to hold an additional $26 billion in core capital, following its 2023 takeover of stricken rival Credit Suisse.
The measures would also mean that UBS will need to fully capitalize its foreign units and carry out fewer share buybacks.
“The rise in the going-concern requirement needs to be met with up to USD 26 billion of CET1 capital, to allow the AT1 bond holdings to be reduced by around USD 8 billion,” the government said in a Friday statement, referring to UBS’ holding of Additional Tier 1 (AT1) bonds.
The Swiss National Bank said it supported the measures from the government as they will “significantly strengthen” UBS’ resilience.
“As well as reducing the likelihood of a large systemically important bank such as UBS getting into financial distress, this measure also increases a bank’s room for manoeuvre to stabilise itself in a crisis through its own efforts. This makes it less likely that UBS has to be bailed out by the government in the event of a crisis,” SNB said in a Friday statement.
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