Warren Buffett's Berkshire Hathaway Swings to a Rare Loss

Warren Buffett's Berkshire Hathaway Swings to a Rare Loss

Perhaps a very powerful query for Berkshire is how are they going to spend all that money?

Berkshire’s money pile retains rising and stood round $116 billion at yr finish. The quantity is predicted to fall barely, however keep comparatively excessive, when Berkshire stories its first-quarter earnings shortly.

Mr. Buffett acknowledged in his annual letter earlier this yr that the stress is on for Berkshire to make a big acquisition quickly. Prices for companies had been too excessive for his style in 2017, he mentioned, however “our smiles will broaden when we have redeployed Berkshire’s excess funds into more productive assets.”

As Berkshire’s subsidiaries proceed to rake in money, questions on returning money to shareholders will proceed to come up both for Mr. Buffett, or for his eventual successor.

Mr. Buffett has shot down the concept that Berkshire ought to pay a dividend almost yearly, saying that he could make higher use of Berkshire’s money by investing it. And shareholders voted down a proposal in 2014 asking the board of administrators to contemplate paying one. But in recent times, he’s recommended that a time might come when Berkshire would possibly run out of how to profitably deploy its money hoard.

If not a dividend, maybe a extra aggressive buyback technique? Right now, Berkshire has an open-ended repurchase program the place it says it is going to contemplate shopping for up its personal shares in the event that they commerce beneath 120% of e book worth. Mr. Buffett mentioned on CNBC in February that the brink may rise sooner or later.

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