Last month, the legendary Warren Buffett made the big decision... As you surely know by now, the 94-year-old "Oracle of Omaha" has announced that he will be retiring as CEO of Berkshire Hathaway (BRK-B).
Editor's note: The markets and our Chaikin Analytics offices will be closed tomorrow, June 19, for Juneteenth. So we won't publish our Chaikin PowerFeed e-letter. You can expect to receive your next issue on Friday, June 20.
The Buffett Era Is Ending Amid a Breakthrough
By Marc Chaikin, founder, Chaikin Analytics
Last month, the legendary Warren Buffett made the big decision...
As you surely know by now, the 94-year-old "Oracle of Omaha" has announced that he will be retiring as CEO of Berkshire Hathaway (BRK-B).
During Berkshire's annual meeting last month, Buffett said he would step down at the end of this year. And he wants Greg Abel – Berkshire's vice chairman of noninsurance operations – to take his place.
This announcement came as a shock to the world. And it shocked Abel himself, as he didn't know about Buffett's decision to retire beforehand.
Buffett took control of Berkshire all the way back in 1965. His name is synonymous with his company.
And heading Berkshire has consistently put Buffett among the wealthiest people in the world. (Today, he ranks fifth.)
Despite that incredible wealth, Buffett is a man of modesty...
He lives in the same house he bought for $31,500 back in 1958.
Adjusted for inflation, that sum of money would be currently worth a bit more than $350,000. Today, the average house in America sells for nearly $504,000.
Buffett also drives a 2014 Cadillac XTS... which his daughter picked out for him. A Cadillac is nice, but it's no Rolls-Royce...
Put simply, Buffett is more than the world's most successful value investor. He's the living embodiment of value itself.
This begs the question that plenty of investors have been asking – what is Berkshire Hathaway without Warren Buffett?
The market is asking the same question, too...
Buffett made his retirement announcement on Saturday, May 3. The next trading day, Berkshire's stock fell 5%.
Overall, BRK-B shares are down about 10% since Buffett's announcement. Meanwhile, the S&P 500 Index is up roughly 5% over the same span.
That's a big disconnect.
But it makes sense. Today, we're in the midst of a major change...
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You see it's actually easy for companies to "fudge" their earnings... and to make things seem rosier than they really are.
They do it using completely legal means – accounting tricks.
Buffett had a talent for seeing these tricks. And it made him one of the richest men in the world.
But now, he's retiring. And as you probably know, his longtime investing partner Charlie Munger died in 2023.
This creates a major problem for most people.
That's because we're in a new type of market... driven by companies whose business models didn't exist in the 20th century.
With the rise of AI and next-gen technology, we haven't seen businesses with such incredible combinations of scalability, return on invested capital, market reach, network effects, and customer addiction.
It means that we're in a breakthrough era. It's one where the market is delivering the next batch of big winners.
I'm not just talking about the big-name tech stocks. Nearly every company on Earth is working on getting this breakthrough into its business model.
Some of them are going to succeed. They'll find new efficiencies. And the market will reward them generously.
But there's a downside, too...
The breakthrough sectors are full of "trapdoors." Bad stocks that should be trading near zero are flying high alongside real winners. And when they crash, they'll crush investors.
Now more than ever, you need tools to help you spot the real winners... and sidestep the fakers.
Buffett has a real talent for this. With him stepping down as Berkshire's CEO after so many years, it probably feels like another sign of an evolving market.
And folks are going to need tools specifically designed for this environment.
Here at Chaikin Analytics, that's the Power Gauge. We'll use it to find the winners as the market shifts... and avoid the traps.
Good investing,
Marc Chaikin
P.S. Next week, I'm stepping forward with an urgent update and my newest prediction amid this market environment...
During my special broadcast, I'll also share the details on exactly where I believe you should move your money for the biggest potential gains this year – with the least amount of risk. And I'll cover a new tool my team has developed specifically for this breakthrough environment.
— According to the Chaikin Power Bar, Small Cap stocks remain somewhat more Bullish than Large Cap stocks. Major indexes are mixed.
* * * *
Sector Tracker
Sector movement over the last 5 days
Energy
+4.23%
Information Technology
+0.19%
Utilities
-0.63%
Real Estate
-1.11%
Industrials
-1.12%
Communication
-1.24%
Consumer Staples
-1.5%
Financial
-1.61%
Health Care
-1.63%
Materials
-1.87%
Consumer Discretionary
-2.82%
* * * *
Industry Focus
Software & Services
45
80
13
Over the past 6 months, the Software & Services subsector (XSW) has underperformed the S&P 500 by -8.99%. However, its Power Bar ratio, which measures future potential, is Very Strong, with more Bullish than Bearish stocks. It is currently ranked #7 of 21 subsectors and has moved down 1 slot over the past week.
Top Stocks
AMPL
Amplitude, Inc.
CCSI
Consensus Cloud Solu
CXM
Sprinklr, Inc.
* * * *
Top Movers
Gainers
JBL
+8.89%
VLO
+2.91%
CRWD
+2.64%
LMT
+2.63%
HUM
+2.57%
Losers
ENPH
-23.97%
FSLR
-17.89%
AES
-8.12%
UAL
-6.18%
ANET
-5.69%
* * * *
Earnings Report
Reporting Today
Rating
Before Open
After Close
Earnings Surprises
JBL Jabil Inc.
Q3
$2.55
Beat by $0.23
* * * *
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