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How Much Berkshire Hathaway Earns | Complete Case Study

Do you know the World’s Best Investor’s Company? 

It’s Berkshire Hathaway, the second-largest most profitable company in the world. 

Owned By the Famous  philanthropist and investor, Warren Buffet who is 3rd richest person in the World.

The company started its initial business in Textile but now they owned companies of many industries like Media, Tech, Food and beverages.

The company has also invested in very popular company Apple and Indian Company One97.

The company ranked No.1 in the United States By Revenue.

The last market capitalization of the company is $496 Billion.

So let’s read the Case Study of Berkshire Hathaway, in these we will discuss how  Berkshire hathaway stated, how much profit they make and how much companies they have acquired.

1. About Berkshire Hathaway 

Berkshire Hathaway  is an american holding company of multitude business. This company is run by Famous Investor Warren Buffet.

The Company owned many well famous private companies like GEICO and also has minor stakes in very big companies like apple.

The Company’s headquarters are  located in Omaha, Nebraska, United States. The CEO and President of the Company is 88 year old Warren Buffet, who ,still lead the company to success.

Company’s A Share is maximum trade for $304,000 On New York Stock Exchange. The company is notable for High Price Stock value.

The Company’s main business is acquired the company and managed them very well.

2. How  Berkshire Hathaway 

The Company Berkshire Hathaway started initially started as Textile Manufacturer Company named Valley Falls  Who is established by Oliver Chase.

Oliver Chase previously worked for First Successful Textile Mile of USA. In 1929 Falls valley merged with Berkshire Manufacturing Company both known as Berkshire Fine Spinning Associates.

In 1955, the company has been merged with the Hathaway Manufacturing Company both known as Berkshire Hathaway. In 1962, The famous investor Warren Buffet starting buy the stocks of Berkshire Hathaway.

At that time the textile business was failing and not making much profit.Stanton made an oral  offer to Warren Buffet to sell his share for $ 11.5 but in written offer he mentioned the price of share is $11.3.

Warren Buffet was angry on these situations, instead of selling his share he purchased more shares of Berkshire Hathaway. After he expand this business into insuaren and other investment business with the Purchase of National Indemnity Company.

In the late 1970, he acquired GEICO. Buffet build up the Berkshire Hathaway as buying the stocks of undervalued companies.

Berkshire Hathaway continuously acquiring new company  low profit making company to build them successful companies.

3. What Berkshire Hathaway Do

The Company has began from Textile Manufacture companies. Thus they will doing business in textile industry.

The Company also operates many self titled companies like Berkshire Hathaway Home Service of America and Berkshire Hathaway Direct Companies.

This self titled companies do their own business. Berkshire hathaway also provide insurance services.

The Company holding a variety of commodities and services  including computer production, electronic products, providing insurance, serving food products and automotive products.

All the services and production are part of Berkshire Hathaway. The company has a multitude of business means the main company Berkshire Hathaway Acquired companies.

So far they have acquired a lot of companies under different categories. The Acquiree Business has its own business. Thus the Business Model of the company is very simple.

They earned profit from the company who is owned by Berkshire Hathaway.

4. How much Profit Berkshire Hathaway Make

So far we have understood the business model of Berkshire, Now take a look at the profit of the Company.

As we know that the company owned many businesses and they have many sources of Incomes. In 2017,  the company has reported net income of $44.9 Billion with revenue of $242 Billion with the hike of 8.3 % over the previous fiscal year.

In 2018, company generates $248 Billions in revenue with the profit of $40.9 Billion. Berkshire hathaway  reports a revenue of $64.972 at the end of the quarter at 30 September, 2019.

 Berkshire hathaway profit

YearRevenue Profit
2018$242 B$40.9 B
2017$242137 M$44940 M
2016$223,604 M$24074 M
2015$210,943 M$24083 M
2014$194,699 M$19872 M

5. Digital Links of Berkshire Hathaway

 

Websitewww.berkshirehathaway.com
LinkedinView on LinkedIn
Contact  Email[email protected]

6. Management Team of Berkshire Hathaway 

The Company’s CEO is very famous businessman and investor who have the proven track record of making billions from investments.

Warren Buffet was born August 30,1930 in Omaha, Nebraska, United States. Warren Buffet’s father was working as a stock broker. Warren Buffet often visit her father’s stockbroker shop and saw the stock price. At the age of   11, Warren Buffet purchased 3 shares of Cities Services.

He sold these shares for little profit. Thus Warren has a deep interest in investment. Warren Buffet invested in many industries like Media, Insurance, Food and beverage industry.

His Investment habits made him 3rd Richest person in the world and has a networth of $87 Billion. 

 

warren buffet

CEO of Berkshire Hathaway

List: Management Team Of  Berkshire Hathaway 

 

CEO & President Warren Buffet
Director Of CommunicationKimberlee Archibald
DirectorScott Forbes
DirectorSue Decker
Board MemberHoward Buffett
Board memberDonald Keough

7. Facts & Figure

 

Categories 

 

Air Transportation, Automotive, Consumer, Credit, Food Processing, Insurance, Property Insurance, Railroad, Real Estate

Headquarters Region Midwestern US 
Founded Date Jan 1, 1839
Operating StatusActive
Funding StatusIPO
No. Of Employees10001+
Legal NameBerkshire Hathaway Inc.
IPO StatusActive
Company TypeFor Profit

8. Funding & Rising

The Company  has never raised any funds from Venture Capitals and Angel Investors. The Company only launch its IPO in which company raised $3.5 M.

The Companies go public from private through IPO Because in Public company its become easy to acquire new  companies.

The Company launched its share on Two Categories A Category Share and B Category Share.

The A Category Share traded around $300000 per share and highest traded stock price on the New York Stock Exchange.

The Company also launched B Category share for retail investors for his trade around $200  per share. The Company’s stock is outperformed over 5 Years on S&P 500 Index.

9. Companies Acquired By  Berkshire Hathaway 

Thus the main business of the Berkshire Hathaway is Acquiring Company. Following are the list of Companies Acquired By Berkshire Hathaway

List of Top Companies Acquire By Berkshire Hathaway 

 

Acquiree NamePrice
Home Services Of AmericaNot Disclosed
Medical Liability Mutual Insurance Co.Not Disclosed
Precision Castparts$37.2 B
Detlev Louis Motorradvertribs$450 M
Charter Brokerage Not Disclosed
Duracell$4.7 B
Van Tuyl GroupNot Disclosed
WPLG Local 10Not Disclosed
Oriental Trading CompanyNot Disclosed
Omaha World HeraldNot Disclosed
McLane Company IncNot Disclosed
Burlington Northern Santa Fe LLCNot Disclosed
GeicoNot Disclosed
Berkshire Hathaway Reinsurance Group Not Disclosed
Lubrizol CorporationNot Mentioned
PacifiCorpNot Mentioned

 10. Investments of Berkshire Hathaway

So war we have read about the  Companies acquired by Berkshire Hathaway. The company has also made many investments in Very Big Companies for taking minor stake. The list of companies are following in which Berkshire has made investments 

 

Organization NameFunding RoundInvestment
RHPost IPO Equity$200 M
One97Funding Round- One97$300 M
Teva Pharmaceutical IndustriesPost IPO Equity$358 M
Pilot Flying JFunding Round – Pilot Flying J
STORE CapitalPost IPO Equity$377 M
Home Capital GroupPost IPO Debt
ApplePost IPO Equity$1 B
Tetrapod SoftwareFunding Round- Tetrapod Software $2.4 M

11. Future Plan of Berkshire Hathaway 

As we have discussed the very big investment and acquisitions by Berkshire Hathway.

The future plan of Berkshire hathaway is acquire more companies and invest in more startups. Berkshire hathaway has never pay dividend to is stakeholders and all the Profits of the company will be reinvested in buying more stocks.

The company are looking for more tech companies to invest in. 

How much Berkshire Hathaway Earns | Berkshire Hathaway Case Study
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