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53-483: The index is a running average of the stock prices of twenty transportation corporations, with each stock's price weighted to adjust for stock splits and other factors. As a result, it can change at any time the markets are open. The figure mentioned in news reports is usually the figure derived from the prices at the close of the market for the day. Changes in the index's composition are rare, and generally occur only after corporate acquisitions or other dramatic shifts in

106-491: A compound annual growth rate (CAGR) of 19.8% compared to a 10.2% CAGR for the S&;P 500 . However, in the 10 years ending in 2023, Berkshire Hathaway produced a CAGR of 11.8% for shareholders, compared to a 12.0% CAGR for the S&P 500 . From 1965 to 2023, the stock price had negative performance in only eleven years (1966, 1970, 1973, 1974, 1984, 1990, 1999, 2002, 2008, 2011, 2015). In August 2024, Berkshire Hathaway became

159-1182: A chain of jewelry stores based in Kansas City that began in 1915, was acquired Berkshire in 1995 after a chance run in between Buffett and Barnett Helzberg on a street in New York City. In June 2000, the company acquired Justin Brands, the parent company of Justin Boots , Acme Boots , and Acme Brick for $ 600 million in cash. Headquartered in Fort Worth, Texas , Acme manufactures and distributes clay bricks (Acme Brick), concrete block (Featherlite), and cut limestone (Texas Quarries). Justin Brands also owns Chippewa Boots , Nocona Boots , and Tony Lama Boots . In December 2000, Berkshire acquired Benjamin Moore & Co. , headquartered in Montvale, New Jersey . Moore formulates, manufactures, and sells architectural coatings that are available primarily in

212-726: A component's core business. Should such an event require that one component be replaced, the entire index is reviewed. As of February 26, 2024, the index consists of the following 20 companies: Alaska Air Group replaced AMR Corporation on December 2, 2011, after AMR corp. filed for bankruptcy protection. Effective October 30, 2012, Kirby Corp. replaced Overseas Shipholding Group , Inc. Effective October 1, 2014, Avis Budget Group Inc. replaced GATX Corporation . On October 15, 2015, American Airlines Group replaced Con-way . Effective December 14, 2021, Old Dominion Freight Line replaced Kansas City Southern . Effective February 26, 2024, Uber replaced JetBlue Airways . The index change

265-563: A diversified group of 32 brands that manufactures and distributes products for residential, industrial, and institutional use. It included Kirby Company , which was sold in 2021, Wayne Water Systems, and Campbell Hausfeld products. Campbell Hausfeld was transferred to Marmon, also a Berkshire subsidiary, in 2015. Scott Fetzer also manufactures Ginsu knives and World Book Encyclopedia . In January 1986, Berkshire acquired Fechheimer Brothers. Fechheimer Brothers owns Flying Cross and Vertx. Flying Cross manufactures public safety uniforms and Vertx

318-511: A five-year agreement to allow Lee Enterprises to manage Berkshire Hathaway's newspaper and digital operations. In 2020, Lee Enterprises acquired BH Media Group's publications and The Buffalo News for $ 140 million in cash, retaining WPLG . In conjunction with the sale, Berkshire lent $ 576 million to Lee. In 1983, Berkshire acquired Nebraska Furniture Mart for $ 60 million. In 2000, Nebraska Furniture Mart purchased Homemakers Furniture. In 1986, Berkshire acquired Scott Fetzer Company ,

371-549: A general decline in the textile industry after World War I . At this time, Hathaway was run by Seabury Stanton , whose investment efforts were rewarded with renewed profitability after the Great Depression . After the merger, Berkshire Hathaway had 15 plants employing over 12,000 workers with over $ 120 million in revenue, and was headquartered in New Bedford . However, seven of those locations were closed by

424-536: A low coincident with some other indices; this was a bit above its low of 1942.19 on March 11, 2003. The index broke above the mid-5000s to begin a run of record highs on January 15, 2013, at a time when the better-known Industrials stood about 5% below all-time highs achieved more than five years earlier. By May, the Industrials and all other major indexes except the NASDAQ group were making all-time highs, including

477-431: A lower price than before the split, the result can be a temporary increase in demand and the share price. Others contend that the management of a company, by initiating a stock split, is implicitly signaling its confidence in the future prospects of the company. In a market where there is a high minimum number of shares, or a penalty for trading in so-called odd lots (a non multiple of some arbitrary number of shares),

530-531: A major interest in a declining textile business. While Buffett maintained Berkshire's core business of textiles, he gradually moved capital to other industries, beginning with the March 1967 acquisition of the National Indemnity group of companies, which include National Indemnity Company, National Liability & Fire Insurance Company, and National Fire & Marine Insurance company, among others. It

583-458: A market capitalization of $ 5000 = 100 × $ 50. If the company splits its stock 2-for-1, there are now 200 shares of stock and each shareholder holds twice as many shares. The price of each share is adjusted to $ 25 = $ 5000 / 200. The market capitalization is 200 × $ 25 = $ 5000, the same as before the split. The analog in currency would be redenomination . This would be where a currency increases in value so that people have to use small fractions. Then

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636-672: A morning edition. Berkshire formed BH Media Group with a purchase of the Omaha World-Herald in December 2011, which included six other daily newspapers and several weeklies across Nebraska and southwest Iowa. In June 2012, Berkshire purchased 63 newspapers from Media General , including the Richmond Times-Dispatch and Winston-Salem Journal , for $ 142 million in cash. In 2012, Berkshire Hathaway bought Texas dailies The Bryan-College Station Eagle and

689-654: A new unit (such as dollar) can be introduced, such that an old unit is equal to 10 (or some number) new units. An example is with the Australian currency. In 1966 the Australian pound was split into two Australian dollars . When a stock splits, many charts show it similarly to a dividend payout and therefore do not show a dramatic dip in price. Taking the same example as above, a company with 100 shares of stock priced at $ 50 per share. The company splits its stock 2-for-1. There are now 200 shares of stock and each shareholder holds twice as many shares. The price of each share

742-538: A per-share value originally kept (by specific management rules) close to 1 ⁄ 30 of that of the original shares (now Class A) and 1 ⁄ 200 of the per-share voting rights, and after the January 2010 split, at 1 ⁄ 1,500 the price and 1 ⁄ 10,000 the voting rights of the Class-A shares. Holders of class A stock are allowed to convert their stock to Class B, though not vice versa. Buffett

795-420: A reduced share price may attract more attention from small investors. Small investors such as these, however, will have negligible impact on the overall price. Ratios of 2-for-1 , 3-for-1 , and 3-for-2 splits are the most common, but any ratio is possible. Splits of 4-for-3, 5-for-2, and 5-for-4 are used, though less frequently. Investors will sometimes receive cash payments in lieu of fractional shares. In

848-627: A slight by an individual), it would have paid off several hundredfold. On March 16, 1980, Berkshire became a public company via an initial public offering , selling Class A shares for $ 290 each. Buffett has had a long relationship with Jeff Bezos ; he turned down an opportunity to invest in Amazon.com in 1994 as he was unable to predict the company's future growth and it was losing money. Berkshire Hathaway purchased shares in Amazon in 2019 currently worth $ 2 billion. Shares closed over $ 100,000 for

901-412: A stock split to obtain the opposite strategy: by refusing to split the stock and keeping the price high, they reduce trading volume. Berkshire Hathaway is a notable example of this. As of 2023, the company has never split its stock and trades at over US$ 500,000. One possible explanation for increased trading volume is confusion. If some investors are unable to recognize that a split stock should trade at

954-552: Is a civilian tactical clothing company. In 1991, Berkshire acquired H.H. Brown Shoe Group . In May 1995, Berkshire acquired RC Willey Home Furnishings . In June 1997, Berkshire acquired Star Furniture Company. In February 1997, Berkshire acquired FlightSafety International (FSI), a pilot training company founded in 1951 by Albert Lee Ueltschi and headquartered at LaGuardia Airport in Flushing, New York . It supplies high technology pilot training to aircraft operators in

1007-404: Is a major area of operations and the retained premiums (float) serves as an important source of capital. As of September 30, 2024, the company had $ 325 billion in cash and cash equivalents, more than any other U.S.-based public company . The company is focused on shareholder returns; between 1965, when Buffett gained control of the company, and 2023, the company's shareholder returns amounted to

1060-581: Is a major source of capital for Berkshire Hathaway's other investments. In 1985, the last textile operations were shut down. Buffett has described purchasing the Berkshire Hathaway textile company as the biggest investment mistake he had ever made, denying him compounded investment returns of about $ 200 billion over the subsequent 45 years. He has estimated that had he invested the same money directly in insurance businesses instead of indirectly via Berkshire Hathaway (due to what he perceived as

1113-470: Is adjusted to $ 25. As a result, when looking at a historical chart, one might expect to see the stock dropping from $ 50 to $ 25. To avoid these discontinuities, many charts use what is known as an adjusted share price; that is, they divide all closing prices before the split by the split ratio. Thus, when looking at the charts it will seem as if the price was always $ 25. Both the Yahoo! historical price charts and

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1166-640: Is ranked 5th on the Fortune 500 rankings of the largest United States corporations by total revenue and 9th on the Fortune Global 500 . Berkshire is one of the ten largest components of the S&P 500 and is on the list of largest employers in the United States . Its class A shares have the highest per-share price of any public company in the world, reaching $ 700,000 in August 2024, because

1219-402: Is so high that it becomes unwieldy when traded. One of the reasons is that a very high share price may deter small investors from buying the shares. Stock splits are usually initiated after a large run up in share price. The main effect of stock splits is an increase in the liquidity of a stock: there are more buyers and sellers for 10 shares at $ 10 than 1 share at $ 100. Some companies avoid

1272-586: The Waco Tribune-Herald . In 2013, the company purchased the Tulsa World , the Greensboro, North Carolina -based News & Record , Virginia's Roanoke Times , and Press of Atlantic City . In 2014, Graham Holdings Company sold its Miami television station, ABC affiliate WPLG to BH Media in a cash and stock deal. In June, 2018, Lee Enterprises and Berkshire Hathaway reached

1325-960: The CHI Health Center Omaha in Omaha, Nebraska. Attendance generally totals over 40,000 people and the meetings last for 6 to 8 hours, with Buffett himself, as well as Abel and Jain, answering questions from shareholders. Known for their humor and light-heartedness, the meetings typically start with a cartoon made for Berkshire shareholders. Current members of the board of directors of Berkshire Hathaway are Warren Buffett (chairman), Greg Abel (vice chairman of non-insurance business operations), Ajit Jain (vice chairman of insurance operations), Chris Davis, Susan Alice Buffett (Buffett's daughter), Howard Graham Buffett (Buffett's son), Ronald Olson , Kenneth Chenault , Steve Burke , Susan Decker , Meryl Witmer, Charlotte Guyman, Esteban Rodriguez Jr. Charlie Munger served as vice chairman of

1378-669: The Public Utility Holding Company Act of 1935 was repealed in 2005. It owns Northern Powergrid , which operates in the UK. In 2005, it acquired PacifiCorp for $ 5.1 billion in cash, and assumed $ 4.3 billion in PacificCorp debt and preferred stock. MidAmerican was rebranded as Berkshire Hathaway Energy (BHE) in April 2014. The division owns a residential real estate brokerage business, which, in March 2013,

1431-543: The board of directors has historically been opposed to stock splits . Berkshire Hathaway traces its roots to Valley Falls Company , a textile manufacturing company established by Oliver Chace in 1839 in Valley Falls, Rhode Island . Chace, who was a carpenter, started working for Samuel Slater , the founder of the first successful textile mill in America. Chace founded his first textile mill in 1806. In 1929,

1484-557: The hedge fund Castle Point Capital, would join as an investment manager . In early 2012, 50-year-old Ted Weschler , founder of Peninsula Capital Advisors, joined Berkshire as a second investment manager. In the 2015 letter to shareholders, Buffett described hiring them both as "one of my best moves". In the 2016 letter to shareholders, Buffett revealed that each of them independently manages over $ 10 billion on behalf of Berkshire. In January 2018, Berkshire Hathaway appointed Ajit Jain and Greg Abel to vice-chairman roles. Abel

1537-603: The Google historical price charts show the adjusted close prices. Berkshire Hathaway Berkshire Hathaway Inc. ( / ˈ b ɜːr k ʃ ər / ) is an American multinational conglomerate holding company headquartered in Omaha, Nebraska . Founded in 1839 as a textile manufacturer, it transitioned into a major conglomerate starting in 1965 under the management of chairman and CEO Warren Buffett and vice chairman Charlie Munger (1924-2023). Greg Abel now oversees most of

1590-1835: The Loom , Business Wire , NetJets , Oriental Trading Company , Pampered Chef , Ben Bridge Jeweler , CTB International , Central States Indemnity , Johns Manville , Scott Fetzer Company , McLane Company , See's Candies , WPLG , Berkshire Hathaway Energy , Berkshire Hathaway Assurance , and HomeServices of America . Notable stakes in public companies owned by Berkshire as of September 30, 2024, in order of value as of that date, include 2.0% of Apple Inc. ($ 69.8 billion), 21.5% of American Express ($ 46.2 billion), 9.99% of Bank of America ($ 36.4 billion), 9.3% of The Coca-Cola Company ($ 25.7 billion), 6.6% of Chevron Corporation ($ 19.0 billion), 27.2% of Occidental Petroleum ($ 12.8 billion), 13.6% of Moody's Ratings ($ 12.1 billion), 26.9% of Kraft Heinz ($ 10.4 billion), 6.7% of Chubb Limited ($ 7.7 billion), 44.0% of DaVita ($ 6.0 billion), 8.9% of Mitsubishi ($ 5.9 billion), 7.5% of Itochu ($ 5.7 billion), 8.4% of Mitsui ($ 5.2 billion), 2.9% of Citigroup ($ 3.9 billion), 6.9% of Kroger ($ 3.0 billion), 32.5% of Sirius XM ($ 3.0 billion), 8.6% of Visa Inc. ($ 2.6 billion), 1.2% of Verisign ($ 2.3 billion), 8.5% of Marubeni ($ 2.1 billion), 9.5% of Sumitomo Group ($ 2.1 billion), 0.4% of Mastercard ($ 2.1 billion), 0.1% of Amazon.com ($ 2.0 billion), 4.9% of BYD Auto ($ 1.8 billion), 2.4% of Capital One ($ 1.7 billion), 1.9% of Aon ($ 1.6 billion), 1.8% of Nubank ($ 1.2 billion), 9.5% of Ally Financial ($ 1.1 billion), 0.4% of T-Mobile US ($ 1.1 billion), 2.0% of Charter Communications ($ 1.1 billion), 8.6% of Louisiana-Pacific ($ 0.7 billion), 3.7% of Domino's ($ 0.6 billion), 1.3% of HEICO ($ 0.2 billion), 1.1% of Pool Corporation ($ 0.2 billion), and 0.4% of NVR, Inc. ($ 0.1 billion). Insurance

1643-459: The Transports, which reached new closing and intraday records above the 6,500 level. On October 24, 2013, the Transports closed at 7,022.79, for its first close above 7,000 points. It closed the year at a record high of 7,400.57. On May 27, 2014, it first closed above 8,000 points. The index closed above 9000 on November 10, 2014. At the close of 2014, the index hit 9139.92. At the close of 2015,

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1696-766: The Valley Falls Company merged with the Berkshire Cotton Manufacturing Company established in 1889, in Adams, Massachusetts . The combined company was known as Berkshire Fine Spinning Associates . In 1955, Berkshire Fine Spinning Associates merged with Hathaway Mills which had been founded in 1888 in New Bedford, Massachusetts , by Horatio Hathaway with profits from whaling and the China Trade . Hathaway had been successful in its first decades, but it suffered during

1749-424: The above examples ‘y-for-x’ Shows the number of shares before (x) and after (y). Other common reporting nomenclatures are ‘x-y’ and ‘stock dividend’ of [=]y-x. In the above ‘3-for-1’ example (or 1-3 and 2 share stock dividend) would mean a stockholder holding 100 shares (on record date) will receive 200 new shares after the split for those 100 shares. A company which has 100 issued shares priced at $ 50 per share, has

1802-610: The acquisition. The salary for Buffett is $ 100,000 per year with no stock options, which is among the lowest salaries for CEOs of large companies in the United States. Buffett's salary has not changed in 35 years. Buffett also receives approximately $ 300,000 worth home security services from the company annually. Abel and Jain each receive a salary of $ 20 million per year, with a possible $ 3 million annual bonus approved by Buffett. Buffett's letters to shareholders are published annually. Berkshire's annual shareholders' meetings, nicknamed " Woodstock for Capitalists", take place at

1855-451: The company for $ 11.50 per share. Buffett agreed to the deal. A few weeks later, Warren Buffett received the tender offer in writing, but the tender offer was for only $ 11.375. Buffett later admitted that this lower, undercutting offer made him angry. Instead of selling at the slightly lower price, Buffett decided to buy more of the stock to take control of the company and fire Stanton, which in 1965 he did. However, this left Buffett's fund with

1908-713: The company from 1978 until his death on November 28, 2023. With some exceptions, Berkshire Hathaway usually does not invest in real property due to precise pricing, lack of competitive advantage, complex management, and corporation tax disadvantages. Insurance and reinsurance business activities are conducted through approximately 70 domestic and foreign-based insurance companies. Berkshire acquired See's Candies in 1972 for $ 25 million. It produces boxed chocolates and other confectionery products in two large kitchens in California. See's revenues are highly seasonal with approximately 50% of total annual revenues being earned in

1961-501: The company's investments and has been named as the successor to Buffett. Buffett personally owns 38.4% of the Class A voting shares of Berkshire Hathaway, representing a 15.1% overall economic interest in the company. Notable companies wholly-owned by Berkshire include GEICO , Gen Re , BNSF Railway , Precision Castparts Corp. , Lubrizol , Dairy Queen , Duracell , Benjamin Moore & Co. , Pilot Flying J , Clayton Homes , Fruit of

2014-553: The dominating presence of railroads, the Transportation Average was often referred to as "rails" in financial discussions in the early and middle part of the 20th century. The Transportation Average is an important factor in Dow theory . In 1964, the index first broke 200, slightly over where it was in 1929. In 1983, the index first broke 500. In 1987, the index broke 1000. It closed at 2146.89 on March 9, 2009, having

2067-510: The eighth U.S. public company and the first non-technology company to be valued at over $ 1 trillion on the list of public corporations by market capitalization . The company has generally avoided investing in the technology industry ; Buffett has said he prefers evergreen businesses that generate predictable long-term returns, that he doesn't invest in companies that he doesn't understand, and that he does not like to invest in companies that may undergo significant change. Berkshire Hathaway

2120-460: The end of the decade, accompanied by large layoffs. In 1962, Warren Buffett began buying Berkshire Hathaway stock for his fund, anticipating that as the company liquidated textile mills there would come a tender offer when he could sell the shares at a profit. A year later, Buffet and his associates became the largest shareholder of the company, eventually securing a 49% stake. In 1964, Stanton made an oral tender offer to buy back Buffett's stake in

2173-545: The fields of military, governmental, corporate, and regional or mainline flying. FlightSafety is the largest provider of professional aviation training services, with 1,800 instructors and offers more than 4,000 individual courses for 135 aircraft types, using more than 320 flight simulators to serve customers from 167 countries. In October 1997, Berkshire acquired Dairy Queen , based in Edina, Minnesota, for $ 585 million. It franchises approximately 6,000 stores operating under

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2226-417: The first time on October 23, 2006. David L. Sokol , CEO of Berkshire Hathaway Energy until early 2008, was a top lieutenant for Buffett. Sokol, who was paid $ 24 million per year, resigned from Berkshire in 2011 after it was disclosed that he personally made a $ 3 million profit from Berkshire Hathaway's purchase of Lubrizol . In October 2010, Berkshire announced that 39-year old Todd Combs , manager of

2279-475: The fractional ownership of aircraft concept and introduced its NetJets program in the United States with one aircraft type. In 2019, the NetJets program operated more than 10 aircraft types with a fleet size of greater than 750. In 1999, Berkshire acquired MidAmerican Energy Holdings. At the time of purchase, Berkshire's voting interest was limited to 10% of the company's shares, but this restriction ended when

2332-493: The index hit 7508.71, a loss of 17.85% on the year. The following table shows the price return of the Dow Jones Transportation Average, which was calculated back to 1924. There is no fund that tracks this index. There are funds that have a similar behavior, such as iShares Transportation Average ETF ( NYSE Arca :  IYT ). Stock split A stock split or stock divide increases

2385-637: The months of November and December. By 2019, the $ 25 million investment had returned over $ 2 billion, or an 8000% return, to Berkshire. In 1977, Berkshire purchased the Buffalo Evening News and resumed publication of a Sunday edition of the paper that had ceased in 1914. After the morning newspaper Buffalo Courier-Express ceased operation in 1982, the Buffalo Evening News changed its name to The Buffalo News and began to print morning and evening editions. It now prints only

2438-431: The names Dairy Queen, Orange Julius , and Karmelkorn . The stores offer various dairy desserts, beverages, prepared foods, blended fruit drinks, popcorn, and other snack foods. In July 1998, Berkshire Hathaway acquired NetJets , formerly Executive Jet Aviation, for $ 725 million in cash. NetJets is the world's largest provider of fractional ownership programs for general aviation aircraft. In 1986, NetJets created

2491-408: The number of shares in a company . For example, after a 2-for-1 split, each investor will own double the number of shares, and each share will be worth half as much. A stock split causes a decrease of market price of individual shares, but does not change the total market capitalization of the company: stock dilution does not occur. A company may split its stock when the market price per share

2544-487: Was acquired in February 2000 by Wesco Financial Corporation, an 80.1% owned subsidiary of Berkshire and is the largest U.S. provider of rental furniture, accessories and related services in the "rent-to-rent" segment of the furniture rental industry. In May 2000, Berkshire acquired Ben Bridge Jeweler , a chain of jewelry stores established in 1912 with locations primarily in the western United States. Helzberg Diamonds ,

2597-464: Was appointed vice chairman for non-insurance business operations, and Jain became vice chairman of insurance operations. In May 2021, Buffett named Greg Abel to be his successor as CEO of Berkshire Hathaway. Berkshire Hathaway has never undergone a stock split of its Class A shares because of management's desire to attract long-term investors as opposed to short-term speculation . However, in 1996, Berkshire Hathaway created Class B shares , with

2650-404: Was prompted by JetBlue’s low weight in the index of less than one-half of one percentage point caused by its low share price. The average was created on July 3, 1884, by Charles Dow , co-founder of Dow Jones & Company, as part of the "Customer's Afternoon Letter". At its inception, it consisted of eleven transportation companies—nine railroads and two non-rail companies: As a result of

2703-624: Was rebranded as HomeServices of America , a division of Berkshire Hathaway Energy . In addition to brokerage services, it provides mortgage loan originations, title insurance and closing services, home warranty , property insurance and casualty insurance and other related services. The company has acquired several residential real estate brokerages including Long & Foster , acquired in September 2017. In October 1999, Berkshire acquired Jordan's Furniture for an estimated $ 200 million to $ 300 million. CORT Business Services Corporation

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2756-409: Was reluctant to create the class B shares but did so to thwart the creation of unit investment trusts that would have marketed themselves as Berkshire look-alikes. In January 2010, as part of the acquisition of BNSF Railway , Berkshire completed a 50-to-1 stock split of its class B shares . The increased market liquidity resulted in the company's inclusion in the S&P 500 upon consummation of

2809-520: Was valued at $ 35 per share, but Buffett offered $ 50 per share for the company, or $ 8.6 million. In 1963, Franklin Otis Booth Jr. invested $ 1 million in the company and in 1968, David Gottesman invested in the company. The investments made both individuals billionaires. In the late 1970s, Berkshire acquired an equity stake in GEICO , which forms the core of its insurance operations today and

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