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.
What’s In it for me?
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.
|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
|View 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.
CEO of Berkshire Hathaway
List: Management Team Of Berkshire Hathaway
|CEO & President||Warren Buffet|
|Director Of Communication||Kimberlee Archibald|
|Board Member||Howard Buffett|
|Board member||Donald Keough|
7. Facts & Figure
Air Transportation, Automotive, Consumer, Credit, Food Processing, Insurance, Property Insurance, Railroad, Real Estate
|Headquarters Region||Midwestern US|
|Founded Date||Jan 1, 1839|
|No. Of Employees||10001+|
|Legal Name||Berkshire Hathaway Inc.|
|Company Type||For 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
|Home Services Of America||Not Disclosed|
|Medical Liability Mutual Insurance Co.||Not Disclosed|
|Precision Castparts||$37.2 B|
|Detlev Louis Motorradvertribs||$450 M|
|Charter Brokerage||Not Disclosed|
|Van Tuyl Group||Not Disclosed|
|WPLG Local 10||Not Disclosed|
|Oriental Trading Company||Not Disclosed|
|Omaha World Herald||Not Disclosed|
|McLane Company Inc||Not Disclosed|
|Burlington Northern Santa Fe LLC||Not Disclosed|
|Berkshire Hathaway Reinsurance Group||Not Disclosed|
|Lubrizol Corporation||Not 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 Name||Funding Round||Investment|
|RH||Post IPO Equity||$200 M|
|One97||Funding Round- One97||$300 M|
|Teva Pharmaceutical Industries||Post IPO Equity||$358 M|
|Pilot Flying J||Funding Round – Pilot Flying J||–|
|STORE Capital||Post IPO Equity||$377 M|
|Home Capital Group||Post IPO Debt||–|
|Apple||Post IPO Equity||$1 B|
|Tetrapod Software||Funding 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.
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