Japan a 'buying opportunity', will recover: Warren Buffett

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#1
http://economictimes.indiatimes.com/mark...751398.cms

21 Mar, 2011, 11.31AM IST,REUTERS
Japan a 'buying opportunity', will recover: Warren Buffett


DAEGU: Billionaire investor Warren Buffett believes Japan's devastating earthquake is the kind of extraordinary event that creates a buying opportunity for shares in Japanese companies.

Japan, the world's third-largest economy, has been battling to bring an overheating nuclear plant under control after it was battered by the March 11 earthquake and tsunami that rattled global markets and prompted massive intervention in currency markets by the Group of Seven industrial nations.

"It will take some time to rebuild, but it will not change the economic future of Japan," Buffett said on Monday on a visit to a South Korean factory run by a company owned by one of his funds. "If I owned Japanese stocks, I would certainly not be selling them.

"Frequently, something out of the blue like this, an extraordinary event, really creates a buying opportunity. I have seen that happen in the United States, I have seen that happen around the world. I don't think Japan will be an exception," said the 80-year-old investor, dubbed the "Sage of Omaha" for his successful long-term investment strategy.

Buffett heads Berkshire Hathaway Inc , which has substantial insurance and utility investments globally.

Japan's Nikkei share average rose 2.7 per cent on Friday, buoyed by the G7 support, but still ended the week down around 10 per cent, with some $350 billion wiped off share values -- the market's biggest weekly slide since the global financial crisis in 2008. Japanese markets were closed on Monday.

Buffett said Berkshire Hathaway, which at the year-end was sitting on $38 billion of cash equivalent and last week bought US specialty chemicals maker Lubrizol for $9 billion, was looking for more large-scale acquisitions anywhere in the world.

In his annual letter to Berkshire Hathaway shareholders last month, Buffett had said he was looking for more acquisitions.

"The United States is most likely where we will do something," he said at a ground-breaking ceremony for a South Korean factory run by a unit of an Israeli firm owned by his investment vehicle.

Buffett will have yet more money to invest after Goldman Sachs buys back $5 billion of its preferred stock from Berkshire Hathaway, which the fund bought at the height of the global financial crisis.
My Value Investing Blog: http://sgmusicwhiz.blogspot.com/
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#2
I did a blog post on this prior to reading the same article on ST online.

Check out my blog post at http://financiallyfreenow.wordpress.com/...he-crisis/
and the ST article at http://www.straitstimes.com/BreakingNews...47525.html

Visit my personal investing blog at http://financiallyfreenow.wordpress.com now!
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#3
(21-03-2011, 02:43 PM)Musicwhiz Wrote: "It will take some time to rebuild, but it will not change the economic future of Japan," Buffett said on Monday on a visit to a South Korean factory run by a company owned by one of his funds. "If I owned Japanese stocks, I would certainly not be selling them.

"Frequently, something out of the blue like this, an extraordinary event, really creates a buying opportunity. I have seen that happen in the United States, I have seen that happen around the world. I don't think Japan will be an exception," said the 80-year-old investor, dubbed the "Sage of Omaha" for his successful long-term investment strategy.

Thanks for posting the article.

As Tokyo Electric Power Company future earnings will be reduced due to decrease in power generation capacity, it is logical for the shares to trade lower to reflect the lower valuation. However, unaffected electric power companies also saw their share price dropped sharply in the days following Japan's earthquake. Opportunity for big gains was available for early movers.
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#4
Japan ETFs anyone?
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#5
Anyone interested to buy into TEPCO? It's now trading at 60% to book value.

I've been doing some research on this company... Attached is a report by analyst on the cost impact.






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