Berkshire Hathaway's annual meeting is here: What to expect from Warren Buffett and Charlie Munger

Published Fri, May 5 202310:50 AM EDTUpdated Fri, May 5 202312:39 PM EDT

Warren Buffett is set to kick off Berkshire Hathaway 's annual shareholder meeting Saturday before tens of thousands of adoring shareholders. Here's your complete guide to the highly anticipated event. Berkshire's annual "Woodstock for Capitalists" will be held in Omaha, Nebraska, the second straight in-person gathering after two virtual meetings during the pandemic. CNBC and CNBC.com will exclusively cover the event starting Saturday at 10 a.m. ET. This year's meeting comes at a uniquely challenging time for the economy and the markets. On Monday, First Republic became the third failure of an American bank since March, further fueling fears that a recession is imminent. As ever, investors will look to the 92-year-old "Oracle of Omaha" for folksy wisdom in uncertain times. Apart from seeking Buffett's broad guidance amid turmoil, there are also pressing questions about Berkshire's specific equity holdings and operations that shareholders want answered. Buffett said he and his longtime business partner Charlie Munger, age 99, will likely field about 60 questions this year after realizing they answered too few questions in 2022. "Last year, I made a mistake by spending too much time on a few subjects. Consequently we answered far too few questions. I won't go astray this year," Buffett wrote in the shareholders guide. Here are some of the big topics shareholders want Buffett to address: Banking outlook In April, Buffett told CNBC's Becky Quick during a three-hour interview in Japan that he expects to see more bank failures. He said some of the "dumb" things that banks do periodically have been uncovered, most notably having mismatched assets and liabilities. "We're not over bank failures, but depositors haven't had a crisis," the Berkshire chairman and CEO said. "Banks go bust. But depositors aren't going to be hurt." Nonetheless, Buffett has kept two banks in his stock portfolio — Bank of America , the second-largest stake overall, worth more than $33 billion, and Citigroup , worth about $2.5 billion at the end of 2022. Berkshire earlier sold off positions in JPMorgan , Goldman Sachs , Wells Fargo , M & T Bank and PNC Financial , while dramatically slashing its holdings in Bank of New York Mellon and US Bancorp . "What is Berkshire's take on the current banking situation, particularly in the regional banking space? Has the regional banking crisis altered Berkshire's view on the space, and if so, how?" said Catherine Seifert, Berkshire analyst at CFRA Research. Activision, Paramount Berkshire owned about $4 billion of Activision shares as of the end of last year. The stock was initially bought by two of Buffett's investing lieutenants, Todd Combs and Ted Weschler, who manage about $15 billion each. Buffett then scooped up more shares of the video game company in a merger arbitrage play, betting that Microsoft's proposed acquisition would close. But in late April, the UK's antitrust watchdog decided to block what would be the biggest-ever video gaming deal. Along with the Federal Trade Commission's opposition to the merger, that appears to have scuttled the odds the deal will go through. The question of Buffett's Activision stake is expected to come up at the annual meeting. Another stock that's bound to elicit questions is Paramount Global . Berkshire was the biggest institutional holder of the stock as of the end of 2022, with a $1.5 billion bet. Paramount shares tumbled more than 28% on Thursday after earnings and revenue in the latest quarter missed analyst estimates, and the CBS parent slashed its quarterly dividend . The stock logged its worst day since Viacom and CBS merged in December 2019. Asked about Paramount in April's interview, Buffett said streaming is "not really a very good business" for shareholders although entertainment management makes a lot of money. Shareholders are expected to seek more clarity on that media investment. Geico Berkshire shareholders will also be eager to learn more about what's next for auto insurer Geico , the crown jewel of Berkshire's insurance empire and Buffett's "favorite child." Geico is going through a rocky patch, suffering a $1.9 billion pretax underwriting loss in 2022. Competitor Progressive is snapping up market share, according to an analysis from UBS. "Geico lost market share in 2022 while its best competitor, Progressive, gained market share. Moreover, the gap between underwriting margins and growth with Progressive continues to widen," Brian Meredith, Berkshire analyst at UBS, said in a note. Acquisitions One question that shareholders always have focuses on Buffett's potential field of acquisitions. Berkshire bought insurer Alleghany Corp. for $11.6 billion in early 2022. Berkshire's cash hoard stood at nearly $130 billion at the end of 2022. The disciple of Benjamin Graham has been putting money to work over the past year. During the first quarter, in an expected move, Berkshire bought an additional 41.4% stake in the Pilot Flying J, a chain of truck stops, for $8.2 billion, bringing total ownership to 80%. Meanwhile, Berkshire purchased more shares of Occidental Petroleum this year, taking its stake to 23.5%. "Buffett has demonstrated considerable discipline with his OXY purchases, acquiring shares ... at an average price of less than $60 per share," said James Shanahan, Berkshire analyst at Edward Jones. ESG issues There are a few ESG-related shareholder proposals being put to a vote at the annual meeting, including requiring Berkshire to publish an annual assessment of climate-related risks and publish data on its workforce composition by gender, race, and ethnicity. Similar diversity and climate change initiatives have been defeated for several years and the outcome could be the same this year. "Given Chairman and CEO Buffet's 31.5% voting control, CFRA does not expect these proposals to pass," Seifert said in a note. "Regardless of the outcome of the shareholder vote, we think the issues put forth by shareholders at the upcoming annual meeting are valid issues that Berkshire needs to address as the climate change drumbeat grows louder." Agenda (central time) Friday Noon – 5 p.m. Berkshire Bazaar of Bargains (Shareholder Shopping Day) Saturday 7 a.m. — Doors Open at CHI Health Center 9:15 a.m. — Q & A Session Begins Noon — Lunch Break 1 p.m. — Q & A Session Resumes 4:30 p.m. — Annual Shareholders Meeting