Who Will Berkshire Hathaway Buy Next?
At Stockpickr we keep track of Who Will Berkshire Buy Next?, a list of companies that could offer a nice fit for the acquisitive holding company.
Warren Buffett, the chairman and CEO of Berkshire Hathaway (BRK.A), has indicated he wants to make some large acquisitions, and the names on this list -- which represent both large and small companies -- each exhibit several characteristics that the investor has found attractive in the past.
There are two names in particular that I believe are attractive not only because of their strong growth potential, but also because they have potential successors to Buffett in their management teams.
First is Markel (MKL), a niche insurance company that focuses on specialty markets. It is somewhat similar to Berkshire Hathaway, although on a much smaller scale. Markel has a $4 billion market cap vs. Berkshire's $160 billion market cap.Before I explain why Markel is a great company, worthy of Berkshire's attentions as a suitor, it's worth giving a brief overview of how the insurance company works. Basically, insurance companies take in money (the premiums) and invest that cash with the fervent hope that they can hold on to it before all of their customers want their money back. Why would someone want the money back? They don't really -- that's the beauty of it. But if a customer of an auto insurance company, for instance, gets into a car accident, then the insurance company owes money to that customer.
|Which companies do you think Berkshire Hathaway will acquire?
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV