Warren Buffet is the owner and CEO of the American multinational conglomerate holding company Berkshire Hathaway Inc. Moreover, Berkshire Hathaway is the most expensive publicly traded stock in the world of all time.
Currently, BRK. A is trading at $315,604.00. The all-time high was on Oct. 9, 2018 – $335,900. Indeed, the Berkshire stock brings spectacular gains to its shareholders. While this may be true, what makes the Berkshire Hathaway stock so expensive? Let’s find out.
Berkshire Hathaway Inc. | NYSE: BRK.A
Berkshire Hathaway Inc. is a multinational holding company for a multitude of businesses, which is headquartered in Omaha, Nebraska, United States. The company has a long history of operating success and keen investments. Also, in terms of market capitalization, the conglomerate is amongst the most significant public companies in the world.
Moreover, Berkshire Hathaway Inc. is publicly traded on the New York Stock Exchange as BRK.A. Furthermore, the stock trades as two classes (A shares and B shares). Currently, the price per class A share is $315,604.00.
Not only this, but Berkshire Hathaway is famous for its shareholder-oriented management. Indeed, the company focuses on what shareholders think than what analysts suggest. Furthermore, Berkshire Hathaway pays little attention to short-term results. The holding corporation focuses on long-term strategies and thinking.
With this in mind, it is no surprise why Berkshire Hathaway is famous for having the highest share price with Class A shares trading at $315,604.00. Furthermore, Berkshire’s Class B stock is the seventh-largest component of the S&P 500 Index.
Furthermore, as Berkshire Hathaway is one of the largest public companies in the world, shareholders can enjoy the many perks of owning Berkshire Hathaway shares. For instance, since 1965, the company has averaged an annual growth in book value of 19.0%, while employing large amounts of capital, and minimal debt. In fact, the yearly performance of Berkshire Hathaway’s stock was more than twice that of the S&P 500 index.
Understanding Berkshire Hathaway Inc.
Currently, the company wholly owns a diverse range of well-known businesses such as GEICO, Duracell, Dairy Queen, BNSF, Lubrizol, Fruit of the Loom, Helzberg Diamonds, Long and Foster, FlightSafety International, Pampered Chef, Forest River as well as NetJets.
Moreover, the conglomerate holding company owns 8.6% of Pilot Flying J, 26.7% of the Kraft Heinz Company. Further, Berkshire Hathaway Inc. has significant minority holdings in public companies such as American Express (17.6%), Wells Fargo (9.9%), The Coca-Cola Company (9.4%), Bank of America (6.8%) and Apple (5.22%).
As of 2016, Berkshire Hathaway has significant holdings in some of the major US airline carriers. Moreover, the company is the largest shareholder in United Airlines and Delta Air Lines. Also, Berkshire Hathaway Inc. is a top three shareholder in Southwest Airlines and American Airlines.
According to the Forbes Global 2000 list, Berkshire Hathaway is the third-largest public company in the world. Also, it is the tenth-largest conglomerate by revenue and the largest financial services company by revenue in the world. Impressive, right?
Who Owns Berkshire Hathaway?
Warren Buffett runs Berkshire Hathaway Inc. as Chairman and CEO. You probably know him as one of the most successful investors in the world. Buffett’s investment strategy of discipline and patience are remarkable. Moreover, Buffett consistently outperforms the market. Let’s not forget the fact that thousands of investors worldwide follow his moves. Also, Warren Buffett is the fourth wealthiest person in the world, with a net worth of US$102 Billion. Well, this person owns 30.71% of the aggregate voting power and 16.45% of the economic interest of Berkshire Hathaway.
Further, Buffett became the controlling shareholder of the company in the mid-1960s. He began a progressive strategy of diverting cash flows from the core business into other investments. As Warren Buffett is the most respected and successful investor in history, his skills and knowledge have undoubtedly contributed to the success of Berkshire Hathaway. In fact, his reputation and integrity as a leader have played a significant role too.
Furthermore, it is no secret that Buffets seeks to acquire the best companies, and he always insists on a margin of safety. Also, Warren Buffett only invests in businesses that:
- He can understand
- Are run by honest and competent people
- Have favorable long-term prospects
- Are available at an attractive price
Moreover, Buffett turned Berkshire Hathaway from a textile company into a massive holding corporation with a shareholder-oriented, passionate, and sustainable work culture. Further, under Buffett’s leadership, Berkshire shares averaged a 21.4% compounded annual gain in per-share book value from 1965-2006.
I’m proud to be associated with the value system at Berkshire Hathaway; I think you’ll make more money in the end with good ethics than bad.
– Charlie Munger, vice-chairman of Berkshire Hathaway