With our beloved Berkshire Hathaway right near all-time highs, and having seen the stock act as a fairly strong market “tell” in recent years, here is an interesting piece from Bloomberg.com about the successor plan.
Warren Buffett once said that shunning dividends in his early years running Berkshire Hathaway Inc. (BRK/A) allowed him to refocus the company on better businesses, much as a person would overcome “a misspent youth.”
The 82-year-old billionaire is now focused on his legacy as he prepares the company he’s overseen for almost five decades for new management. Using his annual letter tomorrow to outline a dividend strategy could help explain to shareholders how the company’s next leaders should approach the challenge of allocating profits.
“It may ease the burden on the successors” if they are able to initiate a dividend, said Richard Cook, co-manager of the Cook & Bynum Fund (COBYX), which counts Berkshire among its largest holdings. Berkshire and its units “generate a lot of cash.”
Buffett has sought to teach shareholders about business, investing and corporate governance through the annual letters and meetings held in Omaha, Nebraska, where Berkshire is based. As the company grew with investment gains and acquisitions, so did its cash pile, which reached $47.8 billion at the end of September. That’s made the task of allocating the funds more difficult, because it’s hard to find worthwhile, large investments, Buffett has said.
BRK-A is going AAPL