Berkshire Hathaway, the multinational conglomerate led by renowned investor Warren Buffett, has once again made a significant move in the Japanese market.
The company announced on Monday that it has further increased its stake in five prominent Japanese trading companies, cementing its position and riding a wave of remarkable success.
Buffett’s Berkshire Hathaway has been steadily expanding its investments in Japan since 2020, with the latest boost bringing their average stake in Mitsubishi Corp., Mitsui, Itochu, Marubeni, and Sumitomo to over 8.5% each.
In a statement released by the company, it revealed that the aggregate value of these holdings now surpasses that of any other non-U.S. country in its portfolio.
During his visit to Japan last year, Buffett explained his fascination with these companies, highlighting their resemblance to his own conglomerate and their undervalued prices at the time. These factors, combined with his long-term investment philosophy, prompted Berkshire Hathaway to enter the Japanese market, a move that has paid off handsomely.
Buffett’s instincts appear to be on point, as the Nikkei 225 index has surged by a remarkable 28% this year, making it one of the best-performing regional indexes.
Several factors have contributed to this positive trend, including Japan’s corporate governance reforms, signs of increasing inflation and wages, and a shift in sentiment away from Chinese stocks. Additionally, the weakening yen has further bolstered the attractiveness of Japanese stocks.
Investors who followed Buffett’s lead into the Japanese financial market have been handsomely rewarded. The shares of Mitsubishi and Marubeni have skyrocketed by 62% year-to-date, while Mitsui, Itochu, and Sumitomo have enjoyed gains of 44%, 35%, and 39%, respectively. Since the start of 2020, Mitsubishi’s shares have surged fivefold, with the other companies also witnessing robust growth.
Berkshire Hathaway remains committed to its Japanese investments, with plans to hold them for the long term. The company has stated that it may increase its stakes to a maximum of 9.9% in any of the five trading companies, subject to favorable prices.