Buffett Must Be Relieved 2011 is Over; Will the Magic Return in 2012?
Up)
Get out the record book, here's another entry.
According to market and Bloomberg data, Warren Buffett's Berkshire Hathaway (NYSE: BRK-A)(NYSE: BRK-B) failed to outperform the S&P 500 in 2011...for just the second time in 21 years.
Data shows that Berkshire dropped 4.7 percent in 2011, compared to the flat finish for the S&P. Numbers do come with one stipulation: they're measured against when the S&P either declines or posts a gain of less than 5 percent for a year.
Still, over the last 21 years Berkshire stock saw its value increase 17-fold, compared with just a fourfold increase for the S&P.
Buffett himself didn't have a great year either, his personal holdings in Berkshire stock lost him $2 billion (on paper, of course).
But is a change abounding? Last September Buffett initiated the first stock buyback plan in his 40-years at the Berkshire helm. Does Warren need to entice investors (a niche group) back into his stock? Was he out of ideas for returning value through organic growth?
Is he out of ideas for doing so?
These questions must be plaguing investors heading into 2012, a decidedly uncertain year by many expert outlooks. But this isn't the first tumultuous year for markets, or Berkshire, and one event does not a pattern make. Insurance claims from natural disasters, derivative plays that went belly-up, and not to mention the $5 billion investment in Bank of America (NYSE: BAC), will all end up as an asterisk next to the number, and in footnotes at the bottom of its annual report.
Berkshire is up 1.6 percent on the session.
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According to market and Bloomberg data, Warren Buffett's Berkshire Hathaway (NYSE: BRK-A)(NYSE: BRK-B) failed to outperform the S&P 500 in 2011...for just the second time in 21 years.
Data shows that Berkshire dropped 4.7 percent in 2011, compared to the flat finish for the S&P. Numbers do come with one stipulation: they're measured against when the S&P either declines or posts a gain of less than 5 percent for a year.
Still, over the last 21 years Berkshire stock saw its value increase 17-fold, compared with just a fourfold increase for the S&P.
Buffett himself didn't have a great year either, his personal holdings in Berkshire stock lost him $2 billion (on paper, of course).
But is a change abounding? Last September Buffett initiated the first stock buyback plan in his 40-years at the Berkshire helm. Does Warren need to entice investors (a niche group) back into his stock? Was he out of ideas for returning value through organic growth?
Is he out of ideas for doing so?
These questions must be plaguing investors heading into 2012, a decidedly uncertain year by many expert outlooks. But this isn't the first tumultuous year for markets, or Berkshire, and one event does not a pattern make. Insurance claims from natural disasters, derivative plays that went belly-up, and not to mention the $5 billion investment in Bank of America (NYSE: BAC), will all end up as an asterisk next to the number, and in footnotes at the bottom of its annual report.
Berkshire is up 1.6 percent on the session.
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