Berkshire Boosts Mitsubishi Stake, Increases Investment in Japan

Berkshire Hathaway (BRK.B) recently increased its stake in the Japanese trading house Mitsubishi Corp. to 10.23% per media releases. This recent move marks Berkshire's continued expansion in Japan. The insurance behemoth earlier held a 9.74% stake in Mitsubishi. Apart from Mitsubishi, Berkshire has stakes in four other Japanese firms — Itochu, Marubeni, Mitsui and Sumitomo. The company has been steadily increasing its stakes in Japanese firms since initiating investment in July 2019. Per an annual filing in February, Buffett stated that, “these five Japanese companies operate in a manner somewhat similar to Berkshire itself.” He also stated that, “from the start, we also agreed to keep Berkshire’s holdings below 10% of each company’s shares. But, as we approached this limit, the five companies agreed to moderately relax the ceiling. Over time, you will likely see Berkshire’s ownership of all five increase somewhat.” By the end of 2024, Berkshire’s aggregate investment cost was $13.8 billion, while the market value of its stakes had grown to $23.5 billion.Notably, corporate governance reforms have enhanced transparency and capital efficiency, making Japanese companies more attractive to foreign investors. Meanwhile, Japanese companies trade at relatively modest valuations compared to U.S. companies, making them an attractive pick.Also, by issuing yen-denominated bonds, it has limited currency exposure while capitalizing on Japan’s low-cost debt environment. In 2025, Berkshire expects about $812 million in annual dividends, while incurring only $135 million in interest expenses. Favorable yen-dollar movements have provided a further boost, delivering billions in after-tax gains.Increasing investment in Japanese firms thus creates opportunities for more exposure in the growing economy of Asia.What About Other Insurers?MetLife MET, a major U.S. insurer, has built a strong, long-term presence in Japan. MetLife’s most transformative move was acquiring Alico in 2010, positioning MetLife as a leading force in Japan’s life insurance sector and reinforcing its strategic growth ambitions in Asia.Aflac Incorporated AFL established Aflac Ventures Japan in 2019 to invest in cancer care, HealthTech, and InsurTech startups, fostering innovation for Aflac Life Insurance Japan. In 2018, Aflac converted its Japanese branch into a subsidiary. Today, Japan remains a vital revenue driver, underscoring Aflac’s strategic commitment.BRK.B’s Price PerformanceShares of BRK.B have gained 11.3% year to date, outperforming the industry.Image Source: Zacks Investment ResearchBRK.B’s Expensive ValuationBRK.B trades at a price-to-book value ratio of 1.61, above the industry average of 1.56. It carries a Value Score of D.Image Source: Zacks Investment ResearchEstimate Movement for BRK.BThe Zacks Consensus Estimate for BRK.B’s third-quarter 2025 EPS has witnessed no movement over the past seven days, while that for the fourth quarter moved 14.1% higher in the same period. The consensus estimate for full-year 2025 EPS rose 0.9%, while the same for 2026 declined 1.5% over the past seven days. Image Source: Zacks Investment ResearchThe consensus estimates for BRK.B’s 2025 and 2026 revenues indicate year-over-year increases. While the consensus estimate for BRK.B’s 2025 EPS indicates a year-over-year decline, the same for 2026 suggests an increase.  BRK.B stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Zacks Names #1 Semiconductor StockThis under-the-radar company specializes in semiconductor products that titans like NVIDIA don't build. It's uniquely positioned to take advantage of the next growth stage of this market. And it's just beginning to enter the spotlight, which is exactly where you want to be.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $971 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report MetLife, Inc. (MET): Free Stock Analysis Report Berkshire Hathaway Inc. (BRK.B): Free Stock Analysis Report Aflac Incorporated (AFL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks