It's amazing to realize if an investor had purchased 10 of the Class A shares when Buffett took control of the company 50 years ago they'd be worth nearly $1.9 million today. Yet, I'm beginning to wonder if the company's best days are behind it.
The driving force propelling the phenomenal success of the company is what I call "The Buffett Factor." Berkshire's Chairman and CEO earned the kind of investor confidence that meets or exceeds the late Steve Jobs and Microsoft's Bill Gates.
Buffett "eats his own cooking" when it comes to owning shares of his massive holding company. As of the date of his last SEC filing (April 14, 2014) he owned 350,000 Class A shares of Berkshire Hathaway and 3,770,934 Class B shares. The Class A shares are worth many billions of dollars and the Class B shares are valued at about $480 million.
A number of analysts, me included, believe that when the 83-year old "Oracle of Omaha" retires, confidence in the company's future and the value of its stock will take a sizable downturn. Unless, that is, there are incentives for shareholders to hold tight.
On Saturday Warren Buffett hosts his company's annual shareholder meeting. If he announces his retirement -- or even a succession plan -- there's one powerful way he can put a safety net under both classes of Berkshire shares.
First, let's look at how the Class B shares have performed by seeing a 10-year price chart including the trailing 12-month (TTM) EBITDA earnings and revenue per share.
BRK.B data by YCharts
Despite the crash of 2008 to March 2009 shareholders would be up over 110% for the 10 year period, nearly double the performance of the S&P 500 during the same period.