Why are Berkshire Hathaway stocks so expensive?

Question

is it merely a combination of non stock splits and low volume of stocks traded?

Why did Warren Buffet adopt this model?

Much appreciated, Thanks in advance!

Answer 1

just buy the b class shares.

Answer 2

part strategy on buffet's part.  he doesn't want hathaway to be traded like other stocks so the stock isn't split.  the other part is that the cashflows support the price.  the company is designed to be a long term investment.

if all companies were run this way, there would be more investing, a lot less trading, and shorts would be near to non-existent.

Answer 3

Because Warren never allows his shares to be split. I think one of the reasons he does this is to keep out the day traders most of which would never trade a $100,000 stock.

Answer 4

Yes, both.  The result of the high price is lower volume.  Buffet intentionally does not split the stock.

It's basically a holding company or conglomerate, having stakes in public companies such as Coca Cola, as well as taking companies private, insurance Geico.

He follows the Graham Dodd value investing doctrines.  Basically a LT value play.  It's hard to fully value as it's a mix of both stakes in public and private companies, although a good LT value play.

Provides great information on the Berkshire Hathaway website.  Fully read his shareholder letters.

Don't be put off by the high price of the A shares ($116,700), you can always get the B shares ($3,695). At the end of the day it's all about return on investment percentages...

My only concern would be if he was to retire or pass away suddenly.  I believe that there is a significant premium built into the stock price, based on his ability to produce consistent, above market returns.

Happy investing!