Berkshire Hathaway's bottom line hit by falling stocks, Kraft Heinz

David Silverman  Getty Images

David Silverman Getty Images

Buffett released his annual letter to Berkshire Hathaway Inc. shareholders on Saturday.

Berkshire ended the year with $111.9 billion of cash and equivalents.

Buffett has long said Berkshire's operating earnings offer a better view of quarterly performance because they exclude investments and derivatives, which can vary widely.

Edward Jones analyst Jim Shanahan said he was disappointed that Berkshire didn't use more of its cash to repurchase its own shares or invest in other stocks, especially when the market declined near the end of the year.

"There are also many other countries around the world that have bright futures".

He said that since he began investing in 1942, that prosperity has been overseen by seven Republican and seven Democratic presidents, through times of war and financial crisis, and gained in a bipartisan manner.

"Americans will be both more prosperous and safer if all nations thrive", he wrote.

Trump often takes credit for upbeat news on the economy and stock market, sometimes tying them to his economic policies.

In the latest edition, Buffett says it is the prospect of an "elephant-sized acquisition" that causes his heart, and that of his longtime partner, 95-year-old Charlie Munger, "to beat faster".

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Still, Andy Kilpatrick said the results were better than he expected.

Buffett cited three reasons for deemphasizing book value.

"The immediate prospects for that, however, are not good: Prices are sky-high for businesses possessing decent long-term prospects", he added.

Warren Buffett's company recorded a $25 billion loss in the fourth quarter because of a big drop in the paper value of several of its stock investments.

That compared with a year-earlier profit of $32.55 billion, or $19,790 per Class A share, most of which resulted from a lowering of the USA corporate tax rate.

"First, Berkshire has gradually morphed from a company whose assets are concentrated in marketable stocks into one whose major value resides in operating businesses..." The conglomerate, which owns $173bn in stocks, was pulled down by the market's plunge in the last quarter of the year - bringing losses of $22.7bn on its securities.

In his annual letter to shareholders, billionaire businessman Warren Buffett took aim at US President Donald Trump for claiming credit for the country's economic growth without naming the commander in chief directly.

Results also were hurt by a $3.02 billion writedown for intangible assets that Buffett said was "almost entirely" attributable to Kraft Heinz, in which Berkshire owns a 26.7 percent stake.

The packaged food company on Thursday shocked investors when it reported its own $15.4 billion writedown for Kraft, Oscar Mayer and other assets, and said USA securities regulators were examining its accounting practices. Buffett noted in the letter that Berkshire suffered a $20.6 billion loss "from a reduction in the amount of unrealized capital gains that existed in our investment holdings". Berkshire outperformed previous year too, up 0.4 percent compared with a 4.4 percent drop for the index.

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