Berkshire Hathaway stock passes $200k. How did Warren Buffett do it?

Warren Buffett's company, Berkshire Hathaway, saw share prices for its Class A stock cross $200,000 for the first time Thursday. Warren Buffett has avoided stock splitting maneuvers that would make Berkshire Hathaway stock cheaper. 

|
Nati Harnik/AP/File
Berkshire Hathaway Chairman and CEO Warren Buffett gestures during an interview with Liz Claman on the Fox Business Network in Omaha, Neb., in May. Berkshire Hathaway Class A stock hit $200,000 for the first time in morning trading Thursday, Aug. 14, 2014.

For the first time ever, a Class A share of Berkshire Hathaway will cost you more than $200,000. That's just one share for the price of a nice 6-bedroom, 4-bath house in Omaha.

The stock hit the milestone about 45 minutes after the start of trading today.

While many companies use stock splits to keep their per-share price under $1000, or even below $100, Warren Buffett isn't a fan of that maneuver because he thinks it encourages short-term trading rather than long-term ownership.

As a result, Berkshire's Class A has, by far, the largest dollar price per share for any stock trading in the U.S.

(Number two on the list: agribusiness and transportation company Seaboard at just under $2,900 per share.)

Berkshire first closed above $1,000 per share almost 31 years ago on August 26, 1983, a few days before Buffett celebrated his 53rd birthday.

It took almost another 9 years to reach $10,000 on October 16, 1992.

The stock closed at $100,000 a share just over 14 years after that on October 23, 2006.

After closing as high as $149,200 on December 10, 2007, Berkshire dropped along with the rest of the stock market during the credit crisis, closing as low as $72,400 on March 5, 2009. That was a drop of 51.5 percent.

Since then, Berkshire has soared around 176 percent, compared to the benchmark S&P's 183 percent surge.

(Berkshire's Class B shares have been split and were added to the S&P in early 2010. They're now trading around $133 each.)

The Class A stock price has remained in six-digit territory since January, 2010.

With Berkshire's stock at the $200,000 level, the company has a market value of more than $167 billion.

Buffett has been giving away big chunks of his Berkshire stock to charity over the past 8 years, but he still owned 321,000 Class A shares as of mid-July. That stock is now worth $64.2 billion.

You've read  of  free articles. Subscribe to continue.
Real news can be honest, hopeful, credible, constructive.
What is the Monitor difference? Tackling the tough headlines – with humanity. Listening to sources – with respect. Seeing the story that others are missing by reporting what so often gets overlooked: the values that connect us. That’s Monitor reporting – news that changes how you see the world.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

QR Code to Berkshire Hathaway stock passes $200k. How did Warren Buffett do it?
Read this article in
https://www.csmonitor.com/Business/Latest-News-Wires/2014/0814/Berkshire-Hathaway-stock-passes-200k.-How-did-Warren-Buffett-do-it
QR Code to Subscription page
Start your subscription today
https://www.csmonitor.com/subscribe