Core Insights - Berkshire Hathaway (BRK.B) has increased its stake in Mitsui Corp. to over 10%, marking a significant expansion in Japan [1][9] - The company has been steadily increasing its investments in Japanese firms since July 2019, with stakes in five major companies [2][3] - Corporate governance reforms in Japan have made local companies more attractive to foreign investors due to enhanced transparency and capital efficiency [4] Investment Details - Berkshire's total investment cost in Japan is $13.8 billion, with a market value of $23.5 billion by the end of 2024, indicating strong growth [3][9] - The company expects to receive approximately $812 million in annual dividends in 2025 while incurring only $135 million in interest expenses from yen-denominated bonds [5][9] - Favorable currency movements have contributed to significant after-tax gains for Berkshire [5] Market Context - Japanese companies are trading at relatively modest valuations compared to U.S. companies, making them attractive investment opportunities [4] - Other U.S. insurers, such as MetLife and Aflac, have established strong presences in Japan, indicating a competitive landscape for investment in the region [6][7] Performance Metrics - BRK.B shares have gained 7.6% year to date, outperforming the industry average [8] - The price-to-book value ratio for BRK.B is 1.59, slightly above the industry average of 1.54 [11] - Consensus estimates for BRK.B's earnings per share (EPS) for 2025 show a slight decline, while estimates for 2026 suggest an increase [12][13]
Berkshire Boosts Mitsui Stake, Increases Investment in Japan