Berkshire Hathaway – What is it, definition and concept

Berkshire Hathaway is the parent company of a holding company that produces and markets all kinds of products such as construction materials, insurance, consumer products or financial products, among many others.

The Berkshire Hathaway company is closely related to the famous American investor Warren Buffet. In case you don’t know who he is, Warren Buffet, also known as the Oracle of Omaha, is one of the most successful investors in history.

Warren Buffet has managed to outperform the market by far, as you can see in the chart below.

Berkshire Hathaway

A large part of Buffet’s investments are made with the philosophy of investing in value, acquiring shares of quality companies with a long-term path in the medium-long term. These securities can appreciate a lot.

Berkshire Hathaway was acquired by Warren Buffet, who managed to lead this company to absolute success through the expansion of its business lines. He also made use of this company to undertake large investments that have positioned Warren Buffet as the richest person in the world on some occasions.

Origin of Berkshire Hathaway

In order for you to fully understand the origin of the Berkshire Hathaway company, two temporary spaces must be established. The first of them is between 1838 and 1955. In this period, the Valley Falls Company in Rhode Island and the Berkshire Cotton Manufacturing Company, both in the textile sector, were founded.

These two companies merged in 1929 creating Berkshire Fine Spinning Associates. From this moment and until 1955 we can conclude the first temporary space that we mentioned.

The second temporary space begins in the year 1955 and remains until today. In 1955, Berkshire Fine Spinning Associates merged with the Hathaway Manufacturing Company, creating today’s Berkshire Hathaway.

Later, in 1962, the Oracle of Omaha decided to buy its first shares of this company. It was in 1965 when he took control of the company and changed the board of directors.

From this moment on, Warren Buffet decided to expand the company’s lines of business. He began to acquire insurance companies, construction materials, services and retail sales or financial services.

Over time, it is a company that has suffered a great revaluation of its share price. When Warren Buffet bought his first shares they were trading at $7.5, and by the end of 2021, class A shares were trading at $540,000.

What is Berkshire Hathaway so famous for?

Berkshire Hathaway is a very famous company, as it is credited with creating much of Warren Buffet’s fortune. Thanks to this company, and to the great skill of Warren Buffet in the investments he has made, the famous investor has been able to enter the select group of the richest in the world.

Here are some of the companies that Berkshire Hathaway owns in the year 2022:

  • Helzberg Diamonds.
  • Dairy Queen.
  • Lubrizol.
  • Duracell.
  • GEICO.
  • NetJets.
See also  Loyalty program - What it is, definition and concept

Leave a Comment