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BYD's Stock Performance Post-Earnings: A Mixed Bag

2024-08-29 02:46:29.907000

Warren Buffett, the renowned investor and CEO of Berkshire Hathaway, has further reduced his stake in BYD, China's largest electric vehicle manufacturer. Berkshire Hathaway recently sold more shares in BYD's H-shares, bringing its ownership down to 5.99% from the previous 7.02% on June 11. This follows a previous reduction of 1,347,500 shares on June 11 [de4e7f0d] [25773253].

BYD's recent earnings report for the first half of 2024 revealed a revenue of RMB301.127 billion, marking a 15.8% increase year-over-year, and a net profit of RMB13.631 billion, up 24.4% year-over-year. However, the stock opened down approximately 2% at $221.8 following the announcement [33ad7572].

Berkshire Hathaway initially invested in BYD in 2008, purchasing about 225 million shares for $230 million, equivalent to a 10% stake at the time. The late Charlie Munger, Berkshire's vice chairman, played a key role in the BYD investment [73f6bd58]. Despite Buffett's divestment, BYD's shares listed on the Shenzhen stock exchange have shown impressive growth, rising by more than 21% over the past month [25773253].

In contrast, BYD Electronic, a subsidiary of BYD, reported a revenue of RMB78.581 billion, which is a 39.9% increase year-over-year, but its net profit saw only a slight increase of 0.1% year-over-year, leading to a significant drop in its stock price, which opened down 5.08% at $28, hitting a four-month low [33ad7572].

As of March, Berkshire held $189 billion in U.S. Treasury bills, cash, and equivalents after selling $20 billion of stock, primarily Apple, in the first quarter [73f6bd58].

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