The Competitive Advantages of Buffett & Munger Businesses by Bud
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BERKSHIRE HATHAWAY INC. 2019 ANNUAL REPORT BERKSHIRE HATHAWAY INC. 2019 ANNUAL REPORT TABLE OF CONTENTS Berkshire’s Performance vs. the S&P 500 ................................................. 2 Chairman’s Letter* ................................................................... 3-14 Form 10-K – Business Description ............................................................. K-1 Risk Factors ................................................................... K-21 Description of Properties ......................................................... K-25 Selected Financial Data .......................................................... K-31 Management’s Discussion ........................................................ K-32 Management’s Report on Internal Controls ........................................... K-62 Independent Auditor’s Report ..................................................... K-63 Consolidated Financial Statements .................................................. K-66 Notes to Consolidated Financial Statements .......................................... K-71 Appendices – Operating Companies ............................................................ A-1 Annual Meeting Information ...................................................... A-2/A-3 Stock Transfer Agent ............................................................ A-3 Directors and Officers of the Company ........................................... Inside Back Cover *Copyright© 2020 By Warren E. Buffett All Rights Reserved 1 Berkshire’s Performance vs. the -
Warren Buffett: Good Morning and Welcome to Berkshire Hathaway
BERKSHIRE HATHAWAY ANNUAL MEETING 2019 Edited Transcript provided by Yahoo Finance: Warren Buffett: Good morning and welcome to Berkshire Hathaway. For those of you who have come from out of state, welcome to Omaha. The city is delighted to have you here at this event. For those of you who came from outside of the country, welcome to the United States. So, we’ve got people here from all over the world. We’ve got some overflow rooms that are taking care of people. We will just have a few preliminaries and then we will move right into the Q&A period. We’ll break about noon for about an hour. We’ll come back and do more Q&A until about 3:30. Then we’ll adjourn for a few minutes, and then we’ll conduct the meeting. I understand that in the room adjacent, that Charlie has been conducting a little insurgency campaign. I don’t know whether you’ve seen these, but these are the buttons that are available for those of you who keep asking questions about succession. And Charlie wants to answer that question by getting your vote today. So this one says, “Maturity, experience, why accept second best? Vote for Charlie.” I, however, have appointed the monitors who collect the votes, so I feel very secure. Charlie is my partner of 60 years, a director and vice chairman, and we make the big decisions jointly. It’s just that we haven’t had any big decisions. So, we’re keeping him available for the next big one. -
2015 Woodstock of Capitalism
SM What were your worst investments? WB: Holding on to the Berkshire Hathaway Textile Company for 18 years, thinking it would finally turn. It never did. After 18 years Warren closed Woodstock of Capitalism the company, which struggled because of low clothing prices and higher Berkshire Hathaway Annual Shareholders Meeting cotton prices. My second biggest mistake was paying $433 million for the Omaha, Nebraska - May, 2015 Dexter Shoe Company and using BH stock instead of cash to do it. Four years later, we closed the company. Today, that $433 million in BH stock James F. Marshall Jonathan Marshall is worth over $3 billion. President Senior Investment Analyst CM: It’s better to learn from other people’s mistakes than your own. For the tenth consecutive year, my brother Dave, Matt Demet and I joined Gary Vanden Heuvel, President of the BLC Community Bank and his son What impact will safety regulations, like tank car regulations, have on Casey and friend John Wiley, for our annual pilgrimage to Omaha. This Burlington Northern Railroad? year’s event marked the 50th Anniversary of Berkshire Hathaway with WB: The interest of Burlington Railroad, tank car manufacturers and leas- Warren Buffett (84), and Charlie Munger (91) at the helm. Fifty years ing operations might diverge in a few ways, but obviously we have an inter- ago Warren started with $105,000 of family money, today Berkshire Hatha- est in developing safer cars. Both rail and pipelines have their disad- way is worth $360 billion, the fourth largest company in the United States. vantages, but the railroad industry’s safety measures have improved year In 10 years, both Warren and Charlie appear to have not lost a step. -
BRK AGM 2016.Pub
May 2016 Berkshire Hathaway 2016 AGM Omaha, Nebraska Extraordinary Management, The Internet and Energy I had the privilege of travelling for the fourth time to the 2016 Berkshire Hathaway Annual Shareholders Meeting in Omaha, Nebraska last week. The 2015 event was the 50th anniversary of the Warren Buffett / Charlie Munger “Profitable Partnership” at Berkshire Hathaway and the crowd at an estimated 44,000 was out of control. So this year the company invited Yahoo Finance to live-stream the meeting for the first time. Despite this, there was still a great sense of adventure and celebration at the meeting… without the unnecessary large crowds. We’d all come too far to miss out on a good seat, so the day started at 4 a.m. Standing second from the front of the line with friends and like minded investors from Australia, and out of the rain, we were ready for the doors to open. When they did and the chaos subsided, we’d managed to get front row seats, and we knew we were set for another great day! The live-stream, I’m guessing, would have reached out to millions of supporters, shareholders and students, eager to learn from two of the world’s greatest investors, Warren Buffet (WB) now 85 and Charlie Munger (CM), an amazing 92 years of age. WB: “We arranged the online version so more shareholders could see Charlie and I at work and so business owners in other countries could become more familiar with Berkshire”. Despite the live-stream, the format remained the same: three hours of questions, a one hour break and then another three hours of questions, followed by the AGM. -
Warren Buffett Faces Insider Trading: a Case Study by Christian Koch, University of South Florida
Volume 4, Number 1 Example Case Study 8 SEPTEMBER 2020 Warren Buffett Faces Insider Trading: A Case Study By Christian Koch, University of South Florida illionaire Warren Buffett has amassed a tially committed insider trading. Sokol resigns large following among those in the invest- from his position unexpectedly. In rank, Sokol Bment world and the numerous sharehold- is behind Charlie Munger, Buffett’s long-time ers of Berkshire Hathaway. Headquartered in business partner. Sokol is Chairman of sever- Omaha, Nebraska, Berkshire Hathaway oper- al Berkshire subsidiaries and has had a long, ates as a conglomerate that owns and operates successful relationship working with Buffett. businesses with famil- In fact, Sokol is consid- iar brand names like ered Buffett’s protégé Fruit of the Loom, GE- and the lead candidate ICO, Dairy Queen and In March 2011, Warren Buffett to replace Buffett upon Duracell. It also oper- stepped into chaos. The Chairman retirement. ates a large marketable of one of Berkshire Hathaway sub- In a March 30, 2011 securities portfolio run sidiaries, David Sokol, had resigned press release, Buffett by Buffett. Some top his position, but there was more to states, “in our first talk equity holdings are Co- the story. about Lubrizol, Dave ca-Cola, Bank of Amer- Sokol mentioned that ica, American Express, he owned stock in the Wells Fargo and Kraft company. It was a pass- Heinz. ing remark and I did not ask him about the date Buffett learns days after the public announce- of his purchase or the extent of his holdings” ment of the all-cash deal to acquire Lubrizol, (Busines Wire, March 30, 2011). -
Berkshire Hathaway Valuation
Berkshire Hathaway Business Analysis and Valuation April 2010 Vinod Palikala [email protected] Business Analysis and Valuation by Vinod Palikala Contents 1. Company Overview ............................................................................................................................... 3 2. Valuation Approach .............................................................................................................................. 4 3. Valuation ............................................................................................................................................... 6 3.1. Insurance ....................................................................................................................................... 7 3.2. Utilities and Energy ..................................................................................................................... 12 3.3. Manufacturing, Service and Retail .............................................................................................. 13 3.4. Finance and Financial Products ................................................................................................... 14 3.5. Total Company Valuation ............................................................................................................ 15 4. Alternative Valuation Methods ........................................................................................................... 15 4.1. Book Value Growth .................................................................................................................... -
1988-Berkshire-10K Click to View
Fl3l5 SIC 633 BERKSHIRE HA"t:HAWAY INC B 40' 86 00 000 10-K l\IY~ ... CARO·~ FOR 12131188 Quick Reference Chart to Contents of SEC Filings Registration Statements c: "'::> .!2 c: 13 '34 Act '33 Cl~ a: >- E" "c. Act c: ·- xS F-10 8-A "S" :;; 0.. < e~ "'E! UJ REPORT CONTENTS 10-K 20-F 10-Q 8-K 10-C 6-K a. en a. 8-B Type ARS ~~ z Auditor D Name A A A A A A D Opinion A A A A D Changes A Compensation Plans D Equity F F A F D Monetary A F A F Company Information D Nature of Business A A A A A D History F A A F A D Organization and Change F F A A F A Debt Structure A A A A Depreciation & Other Schedules A A A A A Dilution Factors A A F A A A Directors, Officers1 Insiders D Identification D Background D Holdings D Compensation Earnings Per Share A Financial Information D Annual Audited D Interim Audited D Interim Unaudited Foreign Operations Labor Contracts Legal Agreements Legal Counsel Loan Agreements Plants and i;>ropertles ' Portfolio Opfratlons D Content,i,Listing of Securities) A D Management A Product-Line Breakout A A A Securities Structure A A Subsidiaries A A Underwriting A Unregistered Securities A Block Movements A Legend A - always included - included - if occurred or significant F - frequently included - special circumstances only TENDER OFFER/ACQUISITION REPORTS 13D 13 G 14D-1 14D-9 13E-3 13E-4 Name of Issuer (Subject Company) A A A A A A Filing Person (or Company) A A A A A A Amount of Shares Owned A A Percent of Class Outstanding A A Financial Statements of Bidders F F F Purpose of Tender Offer A A A A Source and Amount of Funds A A A Identity and Background Information A A A Persons Retained Employed or to be Compensated A A A A Exhibits F F F F F © Copyright 1988<c/;SCLOSVRE® 1NcoRPoRATEo 5161 River Road D 'Bethesda, MD 20816 D 301/951-1300 •_'; BJ+oEt...O""D SECURITIES AND EXCHANGE COMMISSION ... -
Berkshire Hathaway Annual Meeting Notes by Ingrid R. Hendershot, Cfa
2017 BERKSHIRE HATHAWAY ANNUAL MEETING NOTES BY INGRID R. HENDERSHOT, CFA BERKSHIRE HATHAWAY 2017 ANNUAL MEETING NOTES BY INGRID R. HENDERSHOT,CFA We tuned into Berkshire Hathaway’s annual meeting webcast held on May 6, 2017, in Omaha. Warren Buffett, Chairman of Berkshire Hathaway, and Charlie Munger, Vice-Chairman, answered questions from shareholders, analysts and the media. Here are our notes from the annual meeting: INTRODUCTION Warren Buffett: That’s Charlie and I’m Warren Buffett. You can tell us apart because he can hear and I can see. We work well together. We each have our specialty. I’d like to welcome you to Omaha. It’s a terrific city. Charlie has lived in California now for about 70 years, but he still has a lot of Omaha in him. Both of us were born within 2 miles of this building that you’re in. Charlie graduated from Central High which is about one mile from here, it’s a public school. My dad, my first wife, three children and two of my grandchildren have all graduated from the same school, and in fact, my grandchildren will say they have had the same teacher that my dad and I had. It’s a great city. I hope you get to see a lot of it while you’re here. FIRST QUARTER EARNINGS Our earnings report was put out yesterday. The realized investment gains or losses over any given period really mean nothing. We could take a lot of gains if we wanted to or we could take a lot of losses, but we don’t really think about the timing of what we do at all except to the relation of the intrinsic value of what we are buying. -
Insurance Prices May Continue to Decline
Insurance Prices May Continue to Decline by Bloomberg News PASADENA, Calif. (Bloomberg)—Berkshire Hathaway Inc.’s Charles Munger, who has helped Chairman Warren Buffett reduce the firm’s reliance on insurance sales, said declines in policy prices may continue, even as the economy shows signs of recovery. “I would not bet the farm” on price increases, Mr. Munger said Wednesday in Pasadena, Calif., at a shareholders’ meeting of Berkshire’s Wesco Financial Corp. “It’s so easy to underprice and under-reserve.” Mr. Buffett, 79, scaled back coverage of natural disasters in the last two years and invested Berkshire’s cash in bank shares and the $27 billion takeover of railroad Burlington Northern Santa Fe Corp. Mr. Munger, who oversees businesses insuring banks and airlines as Wesco’s chairman, pushed Mr. Buffett to buy a stake in Chinese automaker BYD Co. in 2008. U.S. commercial insurance rates have fallen since 2004 as carriers compete for business. “We’re more tough-minded” than rivals who cut prices, said Mr. Munger. “Berkshire is different.” Mr. Munger, 86, helped Buffett evaluate the takeovers that in the last three decades turned Omaha, Neb.-based Berkshire into a $190 billion firm that sells energy and diamonds, hauls freight and underwrites earthquake insurance. He’s been Berkshire’s vice chairman since 1978 and shares the stage with Mr. Buffett at the company’s annual meeting in Omaha. Messrs. Munger and Buffett drew a crowd of 37,000 people to the May 1 meeting of Berkshire shareholders and they answered questions for five hours on the economy, public policy, business ethics and the company they run. -
2006 Annual Report
BERKSHIRE HATHAWAY INC. 2006 ANNUAL REPORT TABLE OF CONTENTS Business Activities........................................................Inside Front Cover Corporate Performance vs. the S&P 500 ................................................ 2 Chairman’s Letter* ................................................................................. 3 Acquisition Criteria ................................................................................25 Report of Independent Registered Public Accounting Firm...................25 Consolidated Financial Statements.........................................................26 Selected Financial Data For The Past Five Years ..................................................................................53 Management’s Discussion ......................................................................54 Management’s Report on Internal Control Over Financial Reporting ...................................................................73 Owner’s Manual .....................................................................................74 Common Stock Data and Corporate Governance Matters......................79 Operating Companies .............................................................................80 Directors and Officers of the Company.........................Inside Back Cover *Copyright © 2007 By Warren E. Buffett All Rights Reserved Business Activities Berkshire Hathaway Inc. is a holding company owning subsidiaries that engage in a number of diverse business activities including property -
The Complete Financial History of Berkshire Hathaway by Adam
The Complete Financial History of Berkshire Hathaway By Adam Mead Audiobook Companion Audiobook Contents (Charts included from the chapters below) Chapter 1: Textile Conglomerate Chapter 2: 1955–1964 Chapter 3: 1965–1974 Chapter 4: 1975–1984 Chapter 5: 1985–1994 Chapter 6: 1995–2004 Chapter 7: 2005–2014 Chapter 8: The First iftyF Years: 1965–2014 Chapter 9: 2015–2019 Chapter 10: World’s Greatest Conglomerate Chapter 11: Afterward—Berkshire After Buffett vii Figure 1.1: Millions of spindles in place by year and location 40 35 30 25 millions) 20 15 Spindles (in 10 5 0 1914 1925 1938 United States New England Massachusetts Southern States Source: The Decline Of A Cotton Textile City (Wolfbein p. 161). 12 Chapter 1: Textile Conglomerate Table 1.1: Comparative operational data for Berkshire Fine Spinning Associates and Hathaway Manufacturing Berkshire Fine Spinning Hathaway Manufacturing 1934 Net revenues ($ millions) $16.3 $3.9 Equity capital ($ millions) $13.8 $2.1 # spindles 900,000 79,000 # looms 20,000 3,200 1939 Net revenues ($ millions) $18.4 $7.3 Equity capital ($ millions) $13.1 $2.2 # spindles 748,000 62,000 # looms 15,000 2,800 1935–1939 (average) Return on equity 0% 6.10% Profit margin 1.40% 2.10% Revenues/average equity1 $1.34 $3.15 Footnote: Revenues/average equity calculation is from 1936–39 because no data is available for 1935 for Hathaway Manufacturing. Note: No data on 1939 for BFS, but spindles/looms same in 1938 and 1940. Sources: Moody’s Industrial Manuals 1934-40 and author’s calculations. 13 Chapter 1: Textile Conglomerate Figure 1.2: Revenues at Berkshire Fine Spinning and Hathaway Manufacturing from 1940–1949 $70 $60 $50 $40 $30 Revenues (millions) $20 $10 $0 1940 1941 1942 1943 1944 1945 1946 1947 1948 1949 Berkshire Fine Spinning Hathaway Manufacturing Sources: Moody’s Industrial Reports and Berkshire Hathaway Annual Reports. -
The Competitive Advantages of Buffett & Munger Businesses
Moats The Competitive Advantages Of Buffett & Munger Businesses By Bud Labitan 20/70 Chapters, Abridged Edition Released Free Of Charge Copyright © 2012 All rights reserved. Printed in the United States of America. No part of this book may be used or reproduced in any manner without permission. ISBN 978-1105422867 1 2 A truly great business must have an enduring “moat” that protects excellent returns on invested capital. ~ Warren Buffett How do you compete against a true fanatic? You can only try to build the best possible moat and continuously attempt to widen it. ~ Charlie Munger 3 4 TABLE OF CONTENTS INTRODUCTION CHAPTER 1: ACME BRICK COMPANY CHAPTER 2: AMERICAN EXPRESS CO. (AXP) CHAPTER 3: APPLIED UNDERWRITERS CHAPTER 4: BEN BRIDGE JEWELER CHAPTER 5: BENJAMIN MOORE & CO. CHAPTER 6: BERKSHIRE HATHAWAY GROUP CHAPTER 7: BERKSHIRE HATHAWAY HOMESTATE COMPANIES CHAPTER 8: BOATU.S. CHAPTER 9: BORSHEIMS FINE JEWELRY CHAPTER 10: BUFFALO NEWS CHAPTER 11: BURLINGTON NORTHERN SANTA FE CORP. CHAPTER 12: BUSINESS WIRE CHAPTER 13: BYD CHAPTER 14: CENTRAL STATES INDEMNITY COMPANY CHAPTER 15: CLAYTON HOMES CHAPTER 16: COCA COLA (KO) CHAPTER 17: CONOCOPHILLIPS (COP) CHAPTER 18: CORT BUSINESS SERVICES 5 CHAPTER 19: COSTCO WHOLESALE (COST) CHAPTER 20: CTB INC. CHAPTER 21: FECHHEIMER BROTHERS COMPANY CHAPTER 22: FLIGHTSAFETY CHAPTER 23: FOREST RIVER CHAPTER 24: FRUIT OF THE LOOM® CHAPTER 25: GARAN INCORPORATED CHAPTER 26: GATEWAY UNDERWRITERS AGENCY CHAPTER 27: GEICO AUTO INSURANCE CHAPTER 28: GENERAL RE CHAPTER 29: H.H. BROWN SHOE GROUP CHAPTER 30: HELZBERG DIAMONDS CHAPTER 31: HOMESERVICES OF AMERICA CHAPTER 32: IBM CHAPTER 33: INTERNATIONAL DAIRY QUEEN, INC.