Berkshire Hathaway Annual Letter to Shareholders 2021
berkshirehathaway.com · 2022-02-28 · tier T1
Source: Letter · berkshirehathaway.com dated 2022-02-28. Auto-generated factual summary. Not investment advice. Verify before acting.
Berkshire Hathaway's per-share market value grew at a 20.1% compounded annual rate from 1965 through 2021, compared to 10.5% for the S&P 500 with dividends. Buffett attributed progress to increasing intrinsic value through ownership of businesses with durable economic advantages and first-class management. The company's "Big Four" holdings—insurance (with $147 billion in float), Apple (5.55% stake), BNSF railroad (100% owned, $6 billion 2021 earnings), and BHE utility (91.1% owned, $4 billion 2021 earnings)—account for a large portion of value. Berkshire held $144 billion in cash and equivalents at year-end, including $120 billion in U.S. Treasury bills maturing within one year. The company repurchased 9% of outstanding shares over two years for $51.7 billion, increasing continuing shareholders' ownership stakes in all Berkshire businesses by roughly 10%. Buffett emphasized that Berkshire's prosperity has been "mightily fostered" by operating in America, with the company now paying approximately $9 million daily in federal income taxes versus $100 daily during its textile-industry struggles in the 1950s.
Citations · 14
“Compounded Annual Gain – 1965-2021............................................20.1%10.5%”
p#1 · confidence 98%
“Berkshire's total float has grown from $19millionwhen we entered the insurance business to $147billion.”
p#1 · confidence 96%
“Your railroad had record earnings of $6 billion in 2021.”
p#1 · confidence 97%
“BHE, our final Giant, earned a record $4 billion in 2021. That's up more than 30-fold from the$122 million earned in 2000”
p#1 · confidence 97%
“Berkshire's balance sheet includes $144 billion of cash and cash equivalents (excluding the holdings of BNSF and BHE). Of this sum, $120 billion is held in U.S. Treasury bills, all maturing in less than a year.”
p#1 · confidence 98%
“During the past two years, we therefore repurchased9%of the shares that were outstanding at yearend 2019 for a total cost of $51.7 billion.”
p#1 · confidence 97%
“That expenditure left our continuing shareholders owning about10%more ofallBerkshire businesses”
p#1 · confidence 96%
“In 2021, for example, we paid $3.3 billion while the U.S. Treasury reportedtotalcorporate income-tax receipts of $402 billion.”
p#1 · confidence 97%
“Now, Berkshire pays roughly $9milliondaily to the Treasury.”
p#1 · confidence 94%
“At yearend, those domestic infrastructure assets were carried on Berkshire's balance sheet at $158 billion.”
p#1 · confidence 96%
“Yet our "share" of Apple's earnings amounted to a staggering $5.6billion. Much of what the company retained was used to repurchase Apple shares”
p#1 · confidence 93%
“BNSF trains traveled 143 million miles last year and carried 535 million tons of cargo. Both accomplishments far exceed those of any other American carrier.”
p#1 · confidence 97%
“Today, TTI markets more than one million different items with annual volume of $7.7 billion.”
p#1 · confidence 95%
“When Berkshire purchased TTI, the company employed 2,387. Now the number is 8,043.”
p#1 · confidence 97%
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