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Buffett, Berkshire, Chubb | Fox Business
Chubb CEO Evan Greenberg discusses the impact of climate change on insurance prices on ‘The Claman Countdown.’
When investors got wind of the news Warren Buffett’s Berkshire Hathaway added Chubb to its portfolio in May, the insurer became a new celebrity stock.
The $6.72 billion stake of 25.9 million shares sent shares to an all-time high, and it’s currently trading just below that level. Buffett, known for buying companies for the long haul, puts Chubb in the ninth-largest position among his other marquee holdings, which include Coca-Cola, Apple and American Express.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| CB | CHUBB LTD. | 254.08 | -1.49 | -0.58% |
| KO | THE COCA-COLA CO. | 63.33 | +0.18 | +0.29% |
| AAPL | APPLE INC. | 221.55 | +1.28 | +0.58% |
| AXP | AMERICAN EXPRESS CO. | 235.71 | -0.26 | -0.11% |
While Buffett doesn’t explain why he buys or sells a particular stock when its disclosed, his past remarks give a sense of what he looks for, including companies considered “moats” unable to be matched or accessed by competitors.
WARREN BUFFETT LIKES “MOATS” AND ELEPHANT-SIZED ACQUISITIONS
“In business, I look for economic castles protected by unbreachable ‘moats,'” Buffett said in a 1995 letter to shareholders. At the time, he gave a shoutout to his insurance company Geico for holding that title.
His love for the insurance business isn’t new. He owns Geico, repped by the likable green reptile and General Re. So, what does the Oracle of Omaha see in Chubb?
In this photo illustration, the Geico logo is displayed on a smartphone. (Photo Illustration by Rafael Henrique/SOPA Images/LightRocket via Getty Images / Getty Images)
Is it the company’s 1.4% annual dividend? Nope, according to CEO Evan Greenberg, son of legendary 99-year-old former AIG CEO and insurance industry pioneer Hank Greenberg.
“We are actually a low yielding stock. You don’t buy us for dividends. It’s about 1.4%, He’s not buying it for the dividend,” Greenberg explained during an interview on ‘The Claman Countdown’ last month.
What Buffett likely sees, Greenberg suggests, is years ahead of steady upside for the insurer.
Double-digit earnings growth
“We’re actually a growth company. Our earnings have been growing in double-digits for the last few years, and, as we look forward, we’ll continue robust earnings growth,” said Greenberg, who also touted the multiple streams of income the insurer is fielding in the U.S. and abroad.
Warren Buffett is joined onstage by 24 other philanthropists and influential business people featured on the Forbes list of 100 Greatest Business Minds during the Forbes Media Centennial Celebration at Pier 60 Sept. 19, 2017, in New York City. (Daniel Zuchnik/WireImage / Getty Images)
Multiple streams of revenue growth, invested assets
“We’re well diversified, property casualty/underwriting; one source of income. Our invested asset, as interest rates have risen and are at a rate than we’ve seen in a couple of decades. That’s another source of income,” he said.
During the company’s first quarter, its pre-tax investment income rose over 25% to $1.39 billion, while adjusted net investment income jumped 23% to $1.48 billion.
Life insurance business in U.S., Asia
And then there’s Chubb’s bread and butter.
“We have a growing life insurance business in Asia. We are a global company, over 40% of business is outside the United States. We are the largest commercial insurer in the U.S., and 20% of our business is in Asia,” he said.
Chubb shares have gained over 13% this year, slightly trailing the S&P 500’s 15%+ rise. Berkshire Hathaway is Chubb’s largest single shareholder, and Greenberg is the second, according to ThomsonOne.
The insurer is scheduled to report quarterly earnings July 24.
Bespoke Investment Group co-founder Paul Hickey breaks down the current volatility in the market and discusses his current favorite investment opportunities on ‘Making Money.’
JPMorgan CEO Jamie Dimon still isn’t a fan of Bitcoin but he’s not letting his personal feelings get in the way of business at the bank.
“When I look at the Bitcoin universe, the leverage in the system, the misuse,” he said at the company’s annual investor day Monday in New York. Noting that bad actors can use it for sex trafficking and terrorism.
“I am not a fan of it. We are going to allow you to buy it. And we’re not going to custody it. We’re going to do is put it on statements for clients. So, you know, I don’t think we should smoke, but I defend your right to smoke. I defend your right to buy Bitcoin, go at it”, he added.
JPMorgan Chase CEO Jamie Dimon Speaks at Investor Day 5/19
At JPMorgan’s Investor Day, Dimon said the bank will now allow clients to buy Bitcoin but that policy hasn’t changed his view on the cryptocurrency. (JP Morgan)
Bitcoin, the largest crypto by market value, is just shy of its all-time high of $106,734.51 reached last year.
DIMON SOUNDS OFF ON HIGH MORTGAGE RATES, LAYS BLAME
Dimon has long been a critic of Bitcoin, including these remarks from 2021:
“I personally think that Bitcoin is worthless,” Dimon said while speaking at a virtual event hosted by the Institute of International Finance. “But I don’t want to be a spokesman for that, I don’t care. It makes no difference to me.” Dimon has also likened the crypto to “fools gold.”
Shares of JPMorgan Chase are up over 10% outperforming the S&P 500 which is flat for the year.
In January 2024, the Securities and Exchange Commission greenlighted the first Bitcoin exchange-traded fund, prompting a slew of firms to launch their own, making the asset class more accessible for both institutional and retail investors.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| IBIT | ISHARES BITCOIN TRUST – USD ACC | 60.66 | +0.68 | +1.13% |
| FBTC | FIDELITY WISE ORIGIN BITCOIN FUND – USD ACC | 93.14 | +0.98 | +1.06% |
| GBTC | GRAYSCALE BITCOIN TRUST ETF – USD ACC | 84.12 | +0.88 | +1.06% |
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iShares Bitcoin Trust ETF, Fidelity Wise Origin Bitcoin ETF and Grayscale Bitcoin Trust ETF are currently the largest funds by assets under management, as tracked by ETF.com.
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Hooters CEO Sal Melilli joins ‘Fox & Friends’ to discuss plans to return the brand to its roots as a ‘neighborhood restaurant.’
Italian restaurant chain Bertucci’s is closing more locations after filing for bankruptcy again to mitigate losses.
The Massachusetts-based business, which has locations along the East Coast and is best known for its brick oven pizza and pasta, filed for Chapter 11 bankruptcy protection in Florida last week. It marked the chain’s third bankruptcy since 2018.
Bertucci’s also closed seven of its underperforming locations – five in Massachusetts, one in Rhode Island and one in Maryland. It now operates 15 restaurant locations in six states, according to court documents.
RESTAURANT CHAIN BERTUCCI’S FILES FOR BANKRUPTCY PROTECTION
Italian restaurant chain Bertucci’s has filed for bankruptcy for the third time since 2018. It has also closed seven restaurants to mitigate losses, according to an April 24 bankruptcy filing. (WFXT)
The company cited the “deterioration” of the U.S. economy and “lack of consumer demand for legacy casual-dining brands” as reasons why the restaurant chain has been operating at a loss, according to the filing.
FAST-FOOD CHAIN CLOSING UP TO 200 ‘UNDERPERFORMING’ LOCATIONS
“With losses accumulating, inflationary pressures still high, and industry headwinds gusting, the proverbial final straw fell on [Bertucci’s] this year as the world saw food costs soar, consumer spending slow, and an uncertain global economy falling in (and out) of decline,” as stated in the bankruptcy documents.
Bertucci’s has assets and liabilities between $10 million and $50 million, according to the filing.
TGI FRIDAYS’ US FOOTPRINT HAS SHRUNK TO 85 RESTAURANTS ACROSS THE COUNTRY
The restaurant chain hopes bankruptcy will provide the business with a “breathing spell” so it can “determine the best path forward and formulate an overall reorganizational plan,” it said in the filing.
In April 2018, Bertucci’s filed for Chapter 11 bankruptcy protection and closed 15 restaurants. In December 2022, amid challenges caused by the COVID-19 pandemic like the closure of restaurants and inflation, it declared bankruptcy for a second time and streamlined operations down to 23 locations, according to the filing.
Bertucci’s previously filed for bankruptcy in 2018 and 2022. (WFXT)
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Bertucci’s did not respond to FOX Business’ request for comment.
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