I have invested in Berkshire Hathaway for a decade or more based on the most simplistic investment thesis: this is Warren Buffett's company and he is the world's greatest investor. There was very little further due diligence after that. So is this investing or speculating?
Saturday, December 25, 2021
Berkshire Hathaway in 2020-21
"An investment operation is one which, upon thorough analysis, promises safety of principal and an adequate return. Operations not meeting these requirements are speculative." - Ben Graham
To satisfy Ben Graham, Warren Buffett's teacher, this post is a quick dive into of Berkshire Hathaway.
Here's a few numbers which should be read as average over the past few years:
Cashflow from operations c.USD40bn
Free Cashflow c.USD25bn
Total assets c.USD870bn
Total equity c.USD440bn
Based on news report, Berkshire has rebounded with a 7% increase in overall profits with some of its businesses exceeding pre-pandemic levels. Cashpile is close to USD150bn and total equity portfolio has also rose to USD308bn and its market cap is now USD650bn.
Berkshire is the lifework of the world's greatest investor. It has compounded its value over the last 50 odd years, and should continue to grow its intrinsic value beyond Warren Buffett and Charlie Munger.
Merry Christmas and Huat Ah!