Greg Abel Closed Berkshire Hathaway's Taylor Morrison Deal on July 24. Here's What Berkshire Owns Now.
Since Greg Abel took over as CEO at Berkshire Hathaway (NYSE: BRKA)(NYSE: BRKB) at the beginning of the year, the company has made some notable moves in the post-Warren Buffett era. There's been a shake-up in its stock portfolio, but something that has flown under the radar is the full acquisition of its second company this year, Taylor Morrison Home, for $72.50 per share, or about $8.5 billion.
Berkshire is known for its stock portfolio, valued at $357 billion as of July 30, but it also owns companies outright. With Abel and Berkshire recently acquiring new operating businesses versus blockbuster stock purchases, it's worth taking a dive into the former.
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The conglomerate now owns dozens of companies outright. Here are some of its notable major subsidiaries:
These give an idea of Berkshire's diversified portfolio. Insurance is its bread and butter, but it has its hands in enough businesses to capture cash flow across plenty of industries.
Even before the Taylor Morrison acquisition, Berkshire owned a few companies involved in housing and building. Companies like Benjamin Moore, Shaw Industries, and Johns Manville focus on specific building materials and products, while Clayton Homes is a homebuilder company.
Taylor Morrison is now Berkshire's second homebuilder, and Abel was clear on why the move was made: "Over time, we expect to unify our site-built homebuilding operations into a combined platform enabling us to deliver the dream of homeownership to more Americans."
By owning homebuilders and product manufacturers, Berkshire has a suite of businesses that can get a piece of the pie during almost every stage of the homebuilding process.
With mortgage rates as high as they are -- around 6.8% and 6.3% for a 30-year and 15-year fixed, respectively, at the time of this writing -- homebuying isn't likely to experience a huge surge anytime soon. However, Berkshire has always been known for playing the long game.
We can't say exactly when another housebuilding boom will occur, but when the time comes, Berkshire will be well positioned to thrive during it.
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Stefon Walters has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy.
Greg Abel Closed Berkshire Hathaway's Taylor Morrison Deal on July 24. Here's What Berkshire Owns Now. was originally published by The Motley Fool