Legendary billionaire investor Warren Buffett released his annual shareholder letter for investors in Berkshire Hathaway Inc. Class A (BRK.A) this morning. As usual, the shareholder letter provided glimpses into the state of affairs at Buffett’s sprawling conglomerate. (See also: Lower Tax Rate Fuels Record Profits For Berkshire's Profits.) 

Generally, 2017 was a record year for corporate profits and Berkshire Hathaway was up there with the best of them. The Omaha, Nebraska-based company reported an 87% jump in net annual income to $44.94 billion from the previous year. President Donald Trump’s tax overhaul, which cut corporate tax rates to 21% from 35%, pumped up the company’s profits by $29.1 billion. (See also: Warren Buffett's Annual Shareholder Letter For 2017.) 

Besides the statistics, here are two things we learned (or did not learn) from Buffett’s letter to shareholders. 

Berkshire Has the Urge to Acquire

In 2017, Berkshire’s cash hoard rose 34.2% to $116 billion from the previous year. Unlike many tech conglomerates that parked their cash abroad, Berkshire Hathaway’s cash is in America. It might have come in handy for acquisitions, but the company was unable to find one at a suitable purchase price.

“In our search for new stand-alone businesses, the key qualities we seek are durable competitive strengths; able and high-grade management; good returns on the net tangible assets required to operate the business; opportunities for internal growth at attractive returns; and, finally, a sensible purchase price,” wrote Buffett.

But a surge in company valuations and profits, coupled with the availability of cheap debt, swelled acquisition activity in 2017, making prospective targets expensive. “Indeed, price almost seemed relevant to an army of optimistic purchasers,” wrote Buffett. 

In lieu of acquisitions, Berkshire purchased stocks of companies that it believed were undervalued; That list includes the likes of Apple Inc. (AAPL), now the company’s biggest holding. (See also: Berkshire 13F: Buffett Adds Apple, Sheds IBM.) Berkshire has also become one of the largest holders of U.S. Treasury bills.

Buffett Is Still Mum About His Successor 

Warren Buffett is 87 and has not yet named a successor. Naturally, speculation is rife about who will replace him. The two main contenders right now are Greg Abel, who heads Berkshire’s non-insurance operations, and Ajit Jain, head of the company’s insurance group. Both were elected to Berkshire Hathaway’s board earlier this year. (See also: Warren Buffett Lines Up Potential Successors at Berkshire.)

Over the years, Buffett has lavished equal praise on both, but provided little indication as to his preferences about who he thinks will succeed him. This year’s letter was no different. 

“You and I are lucky to have Ajit and Greg working for us. Each has been with Berkshire for decades, and Berkshire’s blood flows through their veins. The character of each man matches his talents. And that says it all,” he wrote.

But Bloomberg’s analysis of the letter posits the company’s focus on boosting profits for its non-insurance business may be an indicator of Buffett’s thinking on the matter. 

“If you're grasping for hints about succession, it's noteworthy that here Buffett is singling out growing the non-insurance businesses – that is, Greg Abel's domain – as a priority,” wrote Katherine Chiglinsky, insurance reporter at Bloomberg. (See also: Introducing Warren Buffett's Successor.) 

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