Berkshire Hathaway: What It Is, Market Cap, and Who Owns It

They’re often held by a company’s executives and some members of management so that those in charge of the company can retain control of it in various situations, such as a hostile takeover attempt. Communications firms that provide a repetitive service that manufacturers must use topersuade the public to buy the manufacturer’s products. All businesses must advertisetheir items, and many of the available media face little competition. These includeworldwide advertising agencies, magazine publishers, newspapers, and telecommunicationsnetworks. Commodity-based firms, selling products where price is the single most important factordetermining purchase. They are characterized withhigh levels of competition in which the low-cost producer wins because of the freedom toestablish prices.

The company operates 80 distribution centers and one of the nation’s largest private fleets, delivering 10 billion pounds of merchandise across the U.S. each year. Buffett’s relationship with GEICO goes back as far as his student years. While studying at Columbia University in 1951, Buffett made his first purchase of the insurer’s stock. Some 45 years later – in 1996 – he purchased GEICO’s outstanding stock, officially making the company a subsidiary of Berkshire Hathaway. Precision Castparts Corp (PCC) is a leading manufacturer of complex metal components and products for the aerospace industry.

1. McLane was first acquired by Walmart in 1990 and then acquired by Berkshire Hathaway in 2003 for an estimated $1.5 billion.
2. GEICO, the acronym for “Government Employees Insurance Company,” originally served federal employees and the military.
3. Buffett’s relationship with GEICO goes back as far as his student years.
4. By 1968, the company continues to diversify by acquiring newspapers including Sun Newspaper.
5. Communications firms that provide a repetitive service that manufacturers must use topersuade the public to buy the manufacturer’s products.
6. Warren Buffett became the controlling shareholder of Berkshire Hathaway in the mid-1960s and began a progressive strategy of diverting cash flows from the core business into other investments.

1965: Warren Buffett begins accumulating a majority stake

It’s possible Buffett thinks the stock market is expensive, so he’s cashing in some of Berkshire’s gains to prepare the company for a potential correction. If a correction happens, Buffett can swoop in and put the conglomerate’s cash pile to work. A significant portion of Berkshire Hathaway’s portfolio has always been insurance companies. National Indemnity Company and National Fire & Marine Insurance Company (now a part of National Indemnity) were both purchased in 1967, followed by GEICO in 1996 and General Reinsurance in 1998. Over its lifetime, the company has returned an average of 19.8% annually—roughly double the S&P 500—thanks to its strategic acquisitions and operating discipline.

The five largest acquisitions made in Berkshire Hathaway’s history are Precision Castparts Company, Burlington Northern Santa Fe Company, Lubrizol, GEICO, and McLane. Berkshire Hathaway also has significant equity holdings, of which Apple, American Express, Coca-Cola, Bank of America, and Chevron account for 79%. Robert McLane founded McLane in 1894 as a retail grocery business before quickly pivoting into wholesale trade. In 1976 – after decades of steady growth – the company expanded outside of Texas, and by 1990, it had established a nationwide presence.

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As he moves Berkshire Hathaway HomeServices into Europe and Asia, he might consider the strategy of co-branding to help Berkshire Hathaway in creating associations that consumers are more familiar with and can relate to. Very often consumer brands use celebrity endorsement to create positive and desirable associations for their brands. The rationale is to help consumers to understand what the brand is about by borrowing some personal attributes from celebrities. Adriana Campelo does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment. After all, you don’t see Buffett selling his cash-generating powerhouses like Coca-Cola right now.

Financials

He owes the vast majority of his wealth to the shrewd investments he made with Berkshire Hathaway, in which he has a 15.1% stake worth an estimated $135 billion. The company is run as a conglomerate and manages a portfolio of company holdings. In addition to its stock holdings, the company owns stakes in several private companies including Heinz and Dairy Queen. His starting salary was $12,000 a year (about $136,000 today).23 There he worked closely with Walter Schloss.

Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. Plus, Buffett only authorized $345 million worth of buybacks during Q2, which is the least money Berkshire has spent acquiring its own shares since 2018. Warren Buffett’s unofficial successor will be Greg Abel, CEO of Berkshire Hathaway Energy and vice chair in charge of noninsurance operations, according to an announcement from vice chair Charlie Munger on May 1, 2021. Today, McLane provides a wide range of supply chain services to convenience stores, mass merchants, and chain restaurants, helping them improve efficiency, increase productivity, and drive profitability.

Investment strategy

1. He focused on selecting stocks that would be held for the long term.
2. Berkshire Hathaway’s diverse group of businesses generated a total of $364.5 billion in revenue in 2023 and $96.2 billion in net earnings attributable to Berkshire Hathaway shareholders.
3. Berkshire is an investment company that Warren Buffett has run since 1965.
4. Buffet has a long-standing aversion to using the services of investment banks via Berkshire Hathaway.97 This dynamic was also reported in Barron’s,98 Insider,99 and Seeking Alpha,100 among others.
5. As plants began to close and the demand for textiles declined, the core business was changed to insurance services in 1967.

From 1965 on, Berkshire Hathaway expanded its portfolio significantly, acquiring well over 60 companies (subsidiaries) and holding partial ownership in numerous others. BNSF was created in September 1995, when Burlington North Inc. and Santa Fe Pacific Corp. merged. Both companies were the result of previous railway mergers, and BNSF now has 32,500 miles of track, mostly across the Central and Western U.S. It hauls agricultural products, consumer goods, industrial products, and coal. Duracell manufactures high-performance alkaline batteries, specialty cells, and rechargeables. Its founders, Samuel Ruben and Philip Rogers Mallory, began supplying batteries to Kodak in the 1940s and introduced the Duracell brand name in 1965, coinciding with their decision to launch a range of consumer-centric products. In 1969, Duracell was part of the Apollo 11 mission, making it the first battery on the Moon.

Berkshire Hathaway Inc. (BRK.B), a giant conglomerate and one of the world’s largest companies, was founded by its current chair and CEO, billionaire Warren Buffett. Originally created by the 1955 merger of two New England textile manufacturers, Buffett acquired Berkshire Hathaway warren buffett company name in 1965. It is now a holding company for the many acquisitions and investments Buffett has made over the decades.

You must be a shareholder on or before the next ex-dividend date to receive the upcoming dividend. Customized to investor preferences for risk tolerance and income vs returns mix. The arithmetic makes it plain that inflation is a far more devastating tax than anything that has been enacted by our legislatures. The inflation tax has a fantastic ability to simply consume capital. It makes no difference to a widow with her savings in a 5 percent passbook account whether she pays 100 percent income tax on her interest income during a period of zero inflation, or pays no income taxes during years of 5 percent inflation. Known for their humor and light-heartedness, the meetings typically start with a cartoon made for Berkshire shareholders.