Stock Buybacks by Berkshire Hathaway
This is the first post on this blog. I will cover shareholder topics such as share buybacks or repurchases, dividend payments, and the impact of these actions on shareholder returns and the shareholder's equity carried on the books of the corporations.
I pay homage to the most significant investors of our times - Warren Buffett and Charlie Munger - by looking at the share repurchases by their company - Berkshire Hathaway (BRK.B, BRK.A). Warren Buffett has always approached share buybacks with a lot of caution. He has famously said:
"When stock can be bought below a business’s value it is probably the best use of cash."
In recent years, Berkshire Hathaway has repurchased its own shares. This post will examine the share repurchases and the total diluted outstanding shares. The company does not famously pay any dividends to its shareholders.
Berkshire has spent $59.3 billion on share buybacks since 2010. Most of this money has gone towards buying back its Class A shares. The company has reduced its Class A shares by 34%. But, its Class B share count has increased by 22% since 2010. As of the close of trading on Friday, September 16, 2022, the Class A shares were trading at $414,537, and the Class B shares were trading at $274.81.
Exhibit: Berkshire Hathaway Share Repurchase and Outstanding Shares
|Berkshire Hathaway Share Repurchase (Buybacks) and Class A, Class B Outstanding Share Count