News Column

Sages shares soar to $200,000

August 15, 2014

By Rob Davies, Daily Mail, London



Aug. 15--It's not for nothing that multi-billionaire investor Warren Buffett is known as the 'Sage of Omaha'.

Shares in his investment vehicle Berkshire Hathaway smashed through the $200,000 barrier yesterday to an all-time high. It means anyone who bought 10 shares at $7,100 each in 1990 would today be holding an investment worth a cool $2m.

Buffett started buying stock in the company in 1962, when it was a textiles business, timing his purchases to exploit patterns he had spotted in share price movements. Some 52 years later, the business is worth $326bn, more than the Danish economy.

Berkshire owns 100pc of insurance giants including Geico and General Re, stakes in everything from American Express to Coca-Cola, and has pounds sterling 30bn of cash to spend on acquisitions. Profit for 2013 was up 31pc to a record $19.5bn, on revenues of $49.7bn.

This imperial juggernaut was jump-started by Buffett's shrewd investments in insurance during the 1960s, but owes just as much to his legendary obduracy.

The Sage had agreed a verbal offer of $11.5 a share for his stock from the firm's boss, Seabury Stanton, in 1964, but was infuriated when the formal bid came through slightly lower at $11.375. Offended by the attempt to 'chisel' him, Buffett bought more shares and fired Stanton.

Buffett said in 2010 that this was a mistake. Had he ditched shares in the struggling textile firm, he claimed, he could have built a company worth an extra $200bn by investing even more cash in insurance.

Half a century later, his army of disciples are prepared to ignore a blunder that made Warren Buffett worth pounds sterling 35bn.

___

(c)2014 Daily Mail (London, )

Visit the Daily Mail (London, ) at www.dailymail.co.uk/home/index.html

Distributed by MCT Information Services


For more stories on investments and markets, please see HispanicBusiness' Finance Channel



Source: Daily Mail (London, England)


Story Tools






HispanicBusiness.com Facebook Linkedin Twitter RSS Feed Email Alerts & Newsletters