Meet the Famous Five: A Closer Look at Buffett's Japanese Crew
From Omaha to Osaka: Unpacking the Multi-Billion Dollar Bet on Japan's 'Sogo Shosha'.
So, we know the legendary investor went shopping in Japan. But who exactly are these companies he's adding to his collection? They aren't household names for everyone, but ITOCHU, Marubeni, Mitsubishi Corporation, Mitsui & Co., and Sumitomo Corporation are absolute giants – Japan's famous "sogo shosha" or general trading companies.Think of them less as simple traders and more as sprawling global empires with tentacles in almost everything!
Why These Five? Bargains and Business Brains!
First off, the "bargain hunter" instinct was definitely tingling. Even with impressive operations, their stock prices looked appealingly low compared to many global peers. But it's not just about the price tag. These companies operate a bit like Berkshire Hathaway itself – diversified Goliaths involved in the nitty-gritty of the global economy. And they're known for being smart with their money and pretty good to their shareholders. They boost dividends, buy back stock when it makes sense, and their bosses aren't quite as, let's say, lavishly compensated as some execs elsewhere.
Let's Get Specific – Who Does What?
While they all share the "trading house" DNA, each has its own flavour:
ITOCHU: These folks are particularly strong in consumer-related sectors. Think textiles and food, but they're also big in machinery, energy, chemicals, metals, and even ICT and finance. They've even got a unique division focused purely on developing new consumer-focused businesses!
Marubeni: Marubeni covers a vast range, from food and agriculture (they own a major US agricultural chemical distributor!) to energy, metals, power plants, infrastructure, finance, and aerospace. They have a truly global network woven into countless industries.
Mitsubishi Corporation: Perhaps the most widely recognized name, Mitsubishi Corp is incredibly diverse. Energy (including renewables!), metals, machinery, chemicals, food, urban development, mobility – they are deeply integrated into developing and operating businesses across the globe.
Mitsui & Co.: Mitsui is another giant with its fingers in many pies: energy (like LNG), minerals and metals, machinery and infrastructure (think power plants, railways, ships, cars), chemicals, steel, food, retail, wellness, and IT. They emphasize leveraging their global network for marketing, logistics, and finance.
Sumitomo Corporation: Sumitomo shines in areas like metal products (especially steel for cars and railways, and tubular goods for energy), transportation and construction systems (ships, aircraft, mining equipment), infrastructure projects, media and digital, real estate, and resources like minerals and energy. They're known for sophisticated supply chain management.
The Big Picture: Global Reach & Shareholder Smiles
These companies act as vital arteries for global trade, sourcing raw materials worldwide and feeding them into industries. They build infrastructure, finance projects, and move goods across oceans. It's complex, globetrotting stuff!
And importantly for investors, they tend to share the success. Consistent dividends and strategic share buybacks show a commitment to returning value to the people who own a piece of the company.
Still a Good Deal? Absolutely, Says Berkshire!
Despite some potential headwinds like global trade tensions, the commitment from Berkshire Hathaway speaks volumes. They aren't just dabbling; they've built up substantial stakes. As of recent reports, Berkshire owns impressive chunks of each:
Mitsui & Co.: ~9.8%
Mitsubishi Corp.: ~9.7%
Marubeni: ~9.3%
Sumitomo Corp.: ~9.3%
ITOCHU: ~8.5%
And the story might not even be over. Berkshire has signaled plans to potentially increase these holdings further, seeing them as long-term partners. It’s a powerful vote of confidence – backed by billions – in these diverse, globally connected, and shareholder-friendly Japanese titans!
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Disclaimer: Please remember, the thoughts expressed here are just opinions based on publicly available information like earnings report. This is not financial advice! Investing involves risks, and you should always do your own research and consider your personal financial situation before making any investment decisions. Talk to a qualified financial advisor if you need personalized advice