$100 grand to spare anyone?
Read today that Berkshire Hathaway, Warren Buffett's baby, is acquiring PacifiCorp for US$5.1 billion dollars...IN CASH! This dramatic foray into the energy sector with this utilities purchase led me to think... Actually, I can't really remember what my first thought was, but anyway, one thing led to another and eventually my curiosity persuaded me to check just how big this giant (Berkshire not PacifiCorp) was.
Let me ask you...what comes to mind when you think U.S. blue chip?
Microsoft? $26 per share. GE? $37. Yahoo? Also $37. Ahhh... I know, Google! Psssssssfffttt... at $256, Google pales in comparison to Berkshire. Standing next to the Berkshire, Google looks like a toothpick (or maybe even the splinter of the toothpick). Now hear this people... one share of Berkshire Hathaway will set you back $85,500! Yes, you saw correctly. The comma is in the right place and there is no extra zero. Totally blew my mind...
Five years ago, the stock was worth only(??) $60,000. Take a look at the historical chart. It's been on the up and up. (Trivia: Since 1965, Berkshire has outperformed the S&P 500 34 out of the 39 years by an average of 11.5%.)
It's up 42% from 5 years back and right now I'm wishing I had $85,500 in my account so that I could get my hand on just ONE share. I too would like to make a handsome profit. So please, if you have $100K to spare, do drop me a comment!*
* The astute reader may ask why I'm requesting for $14,500 more than required. The answer, I dunno? Just looks nicer to have a big round figure with lotsa zeros in it...hehe.
posted by piggy @ 6:41 AM
1 comments
1 Comments:
Actually, Berkshire has 2 classes of shares: A shares (which cost about $90grand) and less expensive B shares (which represent 1/30th of an A share and currently trades at about $3grand which you can surely afford with the Temasek salary!).
My biggest grouse with Berkshire shares is that Warren Buffett does not believe in paying out dividends, although it seems that with $44billion (and growing still) cash in hand and (apparently) nothing worthy to invest in, Buffett has recently indicated he is thinking about a one-off dividend in the likes of Microsoft's recent big pay-off. Also, Berkshire turned in a 10.5% rise in book value (latest figures), post tax, which is impressive considering the huge market capitalisation. So there, you should think hard about the Class B shares!
We're acting for the Vendor on that transaction by the way - the joys!
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