Warren Buffett has a new warning about utility stocks.
He says these once-considered safe stocks are no longer safe.
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Utilities have long been the go-to stocks for safe and stable income.
They provide essential services, so revenues stay steady even when the economy slows down.
But Warren Buffett says that era is now over.
As he explained at his latest shareholder meeting…
“The public utility business is not as good a business as it was a couple of years ago.
If anybody doesn’t believe that, they can look at Hawaiian Electric and look at Edison in the current wildfires situation in California.”
In August 2023…
Hawaiian Electric’s stock crashed 76% after fears the company might be responsible for the Maui fires.
The stock still hasn’t recovered.
PG&E in California paid out billions after its equipment caused wildfires from 2017 to 2021.
That forced the company into bankruptcy – and its stock dropped 95%.
More recently, Edison International shares fell as much as 37% in early 2025 after the Palisades fire raised liability concerns.
Even Buffett’s own company has taken a hit.
Berkshire Hathaway is losing money in its energy division.
And it seems this is a trend set to continue.
As incoming Berkshire CEO Greg Abel says…
“The fundamental risk of the wildfires is not going away.”
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Yours in Wealth,
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