Good Morning! UnitedHealthcare is back in the spotlight, facing a DOJ investigation into its Medicare billing practices. The healthcare giant is also offering employee buyouts and its stock has plunged 23% in the past three months. 

Hooters is working with creditors on a restructuring plan that could lead to a bankruptcy filing. Elon’s DOGE fired off a "What did you do last week?" email to government employees, but some departments (like Defense) are telling staff to ignore it.

Plus: Wall Street’s newest crop of private credit billionaires and Nvidia will announce earnings this Wednesday, February 26.

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_{SQUEEZ OF THE DAY}

Buffett’s Annual Letter Just Dropped

Berkshire Hathaway is sitting on a record-breaking $321.4 billion in cash and Treasury bills. Some investors aren’t thrilled and are even wondering why. But Buffett reassured them he hasn’t lost his appetite for great businesses.

Berkshire’s cash pile grew 3.6% last quarter, and while some critics see that as excessive, Buffett wrote that "the great majority of [investor’s] money remains in equities.”

And despite last year’s dip in Berkshire’s stock holdings, the company’s portfolio of operating businesses—railroads, utilities, insurance—got even stronger. Buffett isn’t hoarding cash because he’s scared; he just hasn’t found anything worth splurging on.

Buffett’s letter also confirmed that Berkshire is quietly ramping up its Japan bets. Since 2019, the company has been loading up on five Japanese trading firms—Itochu, Marubeni, Mitsubishi, Mitsui, and Sumitomo. 

Initially, Berkshire capped its stakes at 9.9%, but now those firms are letting Buffett push the limits. The reason? They like how Berkshire operates and see it as a long-term partner. That’s a rare win for a U.S. investor - Japan has a notoriously insular corporate culture.

Berkshire still isn’t paying dividends (the last one was in 1967) and Buffett is unapologetic about it. The compounding effect of reinvestment, he argues, has turned Berkshire into a trillion-dollar company. But the big surprise? No stock buybacks for the second straight quarter. That’s Buffett’s way of saying he doesn’t think Berkshire’s stock is a bargain right now.

Berkshire also paid $26.8 billion in federal corporate income taxes in 2024, accounting for 5% of all corporate income taxes collected in the U.S. On what the U.S. government should do, Buffett had this to say:

“Thank you, Uncle Sam. Someday your nieces and nephews at Berkshire hope to send you even larger payments than we did in 2024. Spend it wisely. Take care of the many who, for no fault of their own, get the short straws in life. They deserve better. And never forget that we need you to maintain a stable currency and that result requires both wisdom and vigilance on your part.”

Takeaway: Berkshire posted $89 billion in profits for 2024, down from $96.2 billion the year before. But operating earnings—Buffett’s preferred metric—rose to $47.4 billion. And the stock? Up 5.6% to start the year, outpacing the S&P 500’s 2.2% gain. Buffett’s message to shareholders? Stay patient, trust the process, and remember: good businesses always beat cash in the long run.

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_HEADLINES

Top Reads

• UnitedHealth’s rough stretch continues with reported DOJ probe, 23% drop (CNBC)

• Buffett removes diversity and inclusion from annual report (MSN)

• Hooters prepares to file for bankruptcy amid declining foot traffic (NYP) 

• Some US agencies tell workers not to reply to Musk’s ‘What did you do last week’ email (CNBC)

• Meta approves plan for bigger executive bonuses following 5% layoffs (CNBC)

• Wall Street's new billionaires got rich on the private credit boom (BB) 

• One ridiculous chart on Nvidia ahead of earnings (YF)

• Celsius pops more than 25% on big quarterly results, Alani Nu acquisition (CNBC)

• Private Equity sees deal pipelines filling in as year begins (WSJ) 

• The family-office gold rush is spurring a conference craze (NBC)

• Home sales drop sharply as prices hit an all-time high for January (CNBC)

• Trump Media approves fund for mergers, acquisitions, partnerships (WSJ)

• Why banks are flying gold bars on commercial flights from London to NYC (Fox)

_{CAPITAL PULSE}

Markets Rundown

Stocks Retreat Amid Growth Concerns

U.S. stocks pulled back on Friday as softer-than-expected PMI data and declining consumer sentiment fueled concerns about slowing growth, driving a rally in bonds and pushing the 10-year Treasury yield down to 4.4%.

The Dow was further pressured by a 7% drop in UnitedHealth’s stock amid a Department of Justice investigation, while WTI oil fell over 2% to $70 per barrel, its lowest this year.

Internationally, Chinese tech stocks surged, with Alibaba jumping 14% following strong earnings and plans for aggressive AI investments, while European markets showed resilience despite sluggish eurozone PMI data.

Earnings have been a bright spot, with the S&P 500 on track for its best quarterly profit growth in three years, led by broad-based strength across sectors including financials, healthcare, and real estate.

However, lingering policy uncertainty and potential volatility underscore the importance of portfolio diversification, particularly as international equities outperform and offer attractive valuations compared to U.S. stocks.

Movers & Shakers

• (+) Celsius Inc ($CELH) +28% after beating earnings; a reported acquisition.

• (–) UnitedHealth ($UNH) -7% because of a reported DOJ investigation.

• (–) Hims & Hers ($HIMS) -26% after the FDA announced the GLP-1 drug shortage is resolved, which was allowing $HIMS to sell more drugs.

Private Dealmaking

• Together AI, an AI computing startup, raised $305 million

• Fluidstack, a cloud-computing startup, raised $200 million

• Mercor, a hiring software company, raised $100 million

• Terra CO2, a building materials business, raised $82 million

• Hightouch, a customer service platform, raised $80 million

• Udaan, an Indian B2B e-commerce company, raised $75 million

For more PE, VC & M&A deals, subscribe to our Buysiders newsletter.

_{NEIGHBORHOOD WATCH}

Real Estate Digest

Mortgage rates dipped again this week, with the 30-year fixed-rate mortgage remaining just below 7% for the fifth straight week. This steady trend brings much-needed stability to the market, offering a positive outlook for both buyers and sellers as the Spring homebuying season approaches.

Latest News

• Why Millennials Should Not Be So Pessimistic About Homeownership

• Higher Rents Are Coming if Interest Rates Don’t Budge

• Wealthy New Yorkers Flock to Palm Beach, Causing House Prices to Skyrocket

• These Places Led the US Ultra-Luxury Market This Year

• Long-term Facts for Housing Look Really Good

• Britney Spears’ Former LA Mansion Hits the Market for $8M

New Listings

• 16 Crosby St Apt: Ph5F New York, NY: 2 Bed / 2.5 Bath - $5,250,000 

• 229 30th St West Palm Beach, FL: 5 Bed / 4.5 Bath -  $1,925,000

• 93 Lloyd Harbor Rd Lloyd Harbor, NY: 5 Bed / 4.5 Bath - $4,000,000

• Via Costanza, Pallanza, Lombardia Italy: 7 Bed / 7 Bath - $7,192,284

• Quinta Da Marinha Villa Cascais, Lisboa Portugal: 6 Bed / 7 Bath - $7,171,436

Fill out this form to get personalized support for buying, selling, renting, or investing in real estate.

_{BOOK OF THE DAY}

Gentle

Being Gentle is about being grounded in self-compassion and a fierce commitment to less—becoming the Gentle You isn’t about taking the easy road.

Organized into three parts—Rest, Less, and Rise—Courtney Carver's Gentle provides simple challenges and practices that will help readers radically and gently shift their pace, headspace, and heart.

Becoming the Gentle You is a practice of real self-care that, over time, will soothe your nervous system and strengthen your relationships.

Gentle is the “don’t do it all” self-help book that promotes less stress and more joy by standing in your light and honoring the person you are.

“From an expert on simplicity and minimalism, a collection of 30 practices to overcome chronic overwhelm, cultivate self-compassion, and find permission to do less–perfect for readers of Rest is Resistance and Wintering.”

_{DAILY VISUAL}

Median Age of Homebuyers: 56

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_{DAILY ACUMEN}

Discomfort

Today, remind yourself that staying within your comfort zone, though tempting, can limit your potential and lead to stagnation.

Studies show that moderate happiness—rather than constant euphoria—often correlates with greater success, as it encourages risk-taking and self-challenge.

By embracing discomfort and uncertainty, you open doors to growth: building resilience, confidence, and adaptability while uncovering new opportunities and a deeper sense of purpose.

Progress lies just beyond the edge of familiarity—take one small step today toward what challenges you, knowing it’s an investment in your personal and professional development.

_{ENLIGHTENMENT}

Short Squeez Picks

• How mindfulness builds confidence

• Adam Grant’s best advice for job seekers

• How to structure a great interview

• The benefits of time-blocking

• How you can get more sleep

_{MEME-A-PALOOZA}

Memes of the Day