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Tags: berkshire hathaway | warren buffett | banking crisis

Morningstar Rates Berkshire Hathaway a 'Buy'

Morningstar Rates Berkshire Hathaway a 'Buy'
Warren Buffett, CEO of Berkshire Hathaway, speaks to the press as he arrives at the annual shareholders meeting in Omaha, Nebraska. (Getty Images/2019 file photo)

By    |   Monday, 20 March 2023 03:52 PM EDT

Warren Buffett’s storied history of coming to the rescue of failing banks and his steady investment hand during crises are reasons to buy shares in Berkshire Hathaway (BRK.A) right now, Morningstar says.

“Another banking crisis, another call to Buffett,” wrote Morningstar analyst Greggory Warren in a note Monday, CNBC reports.

“On multiple occasions over the past two decades, we have seen firms seek out capital from Berkshire on the belief that the ‘Buffett Seal of Approval’ that came with that capital injection would reduce the pressure on their shares,” Warren said.

The Berkshire Hathaway chairman and CEO has been in talks with the Biden administration in recent days about possibly investing in regional banks, according to a Bloomberg News report over the weekend.

In 2011, Buffett invested $5 billion in Bank of America, then struggling after its disastrous acquisition of Countrywide Financial in 2008.

Also related to 2008, following the collapse of investment bank Lehman Brothers that year, Buffett came to the rescue of Goldman Sachs with a $5 billion cash infusion.

Berkshire Hathaway has diverse lines of business, unrivaled balance sheet strength and nearly $130 billion in cash at the end of 2022, Warren reasoned.

“We continue to believe that Berkshire, owing to its diversification and its lower overall risk profile, offers one of the better risk-adjusted return profiles in the financial services sector (and remains a generally solid candidate for downside protection during market selloffs,” Warren said.


 

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StreetTalk
Warren Buffett's storied history of coming to the rescue of failing banks and his steady investment hand during crises are reasons to buy shares in Berkshire Hathaway (BRK.A) right now, Morningstar says.
berkshire hathaway, warren buffett, banking crisis
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2023-52-20
Monday, 20 March 2023 03:52 PM
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