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Investing legend Warren Buffett didn’t make a single major acquisition this year, but Berkshire Hathaway Class A stock still beat the S&P 500 this year by 4%, Bloomberg reports.The secret sauce was a combination of Buffett’s big bet on Bank of America, whose shares doubled last year to $11.61, and a share buy back plan that he announced last month.
The Omaha, Nebraska-based company is also poised to extend its record of outperforming the equity benchmark on Buffett’s favoured scorecard: the change in book value per share over time…
Book value may have climbed to $113,579 a share on Dec. 31, according to an estimate from Meyer Shields, an analyst at Stifel Nicolaus & Co. That would give Buffett’s firm a 7.8 per cent annual growth rate for the five years ended 2012, compared with 1.7 per cent for the S&P 500, including dividends. Berkshire typically discloses year-end book value per share in February when it releases annual results.
So we’ll find out more about how Buffett did without buying any major companies (or, elephants) next month. In the meantime, expect solid numbers.