...Warren Buffet Warren Buffet was born on August 30, 1930. He is one of the most financially and personally successful businessmen of our time. He is the Chief Executive Officer of Berkshire Hathaway, a multinational conglomerate holding company, which is based with it;s headquarters in Omaha, Nebraska; Buffett's hometown. His net worth is around $60 billion, and increases with every passing minute. I chose to write about Warren Buffett because he is a person I have always been quite interested in. He is such an incredibly smart and savvy businessman, but he is also a philanthropist. Buffet (2006) announced that he planned to donate more than 80 percent of his wealth to a handful of private charitable foundations. He has gone against what many of the stock "experts" say about investing in fashionable trends. He has made a habit in his career to purchase undervalued stocks until they turn a profit. During his career, he has made several decisions regarding trades and stock choices, which have been highly doubted by analysts and other people in the business, but he chooses to stick to his plans, and comes up in top in the end. An obstacle that he had to face during his journey to success was the decline of the U.S. textile industry. When this happened, he chose to purchase insurance companies, and using its cash flow to become the owner of several other businesses. He even chose to purchase stocks in Coca-Cola when that particular stock was not favorable in 1998...
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...Warren Buffett Motivation “When you’re associating with the people that you love, doing what you love, it doesn’t get any better than that.” — Warren Buffett The four motivational theories that were analyzed showed a similar element on how leaders can motivate their employees. It assumed the expectations and responsibilities of an employee in a company. Out of the four motivational theories, Warren Buffet has applied McGregor’s Theory Y to motivate his employees. Buffett strongly believes that trust is the main element to motivate employees. Buffett gives empowerment and responsibilities to his heads for them to take ownership over their work. He doesn’t always focus on earning money because the heads of his companies are almost millionaires; Buffett pays his people equally and fairly so that his employees don’t feel ripped off and put their trust in Buffett too. As he wants his managers to act like owners, therefore he treats his managers like owners. Buffett wants his employees to paint their own “picture” and find their own ways of doing things, he doesn’t want to stand behind his employees and tell them to “add blue or red into their picture” because then the employees would lose their creativity. This would also motivate the employees to produce a better work as the employees know they've got Buffett’s trust. I like Buffett’s way of motivating his employees as he used a very humble approach to his people. Everyone should speak up and share their ideas and creativity...
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...Warren Buffet Warren Buffet was born on August 30, 1930. He is one of the most financially and personally successful businessmen of our time. He is the Chief Executive Officer of Berkshire Hathaway, a multinational conglomerate holding company, which is based with it;s headquarters in Omaha, Nebraska; Buffett's hometown. His net worth is around $60 billion, and increases with every passing minute. I chose to write about Warren Buffett because he is a person I have always been quite interested in. He is such an incredibly smart and savvy businessman, but he is also a philanthropist. Buffet (2006) announced that he planned to donate more than 80 percent of his wealth to a handful of private charitable foundations. He has gone against what many of the stock "experts" say about investing in fashionable trends. He has made a habit in his career to purchase undervalued stocks until they turn a profit. During his career, he has made several decisions regarding trades and stock choices, which have been highly doubted by analysts and other people in the business, but he chooses to stick to his plans, and comes up in top in the end. An obstacle that he had to face during his journey to success was the decline of the U.S. textile industry. When this happened, he chose to purchase insurance companies, and using its cash flow to become the owner of several other businesses. He even chose to purchase stocks in Coca-Cola when that particular stock was not favorable in 1998...
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...Case 1: Warren Buffett 1995 Question 1: Warren Buffett's (Buffett) track record as a value investor and sheer financial strength has earned him an incredibly valuable reputation within the financial industry. Being an anomaly in the investment world; when he talks – the market follows. This is noticeably seen in the increase in equity of $718 million. ------------------------------------------------- Question 2: GEICO Outstanding shares April 30, 1995: 67.89 million, of which 34.22 million owned and 33.67 million purchased at $70; total price $2.3 billion. A Capital Asset Pricing Model (CAPM) derived cost of equity equaled 10.99% percent via a risk-free rate of 6.86 percent, a beta of 0.75, and an equity risk premium of 5.5 percent. k = 6.86 + 0.75 ((5.5)) = 10.99% Using Value Line’s forecast & the above discount rate and share information: the following low end & high end NPV are calculated: Low end: -$335.57 High end: $389.89 For methodology in calculation of intrinsic value refer to ‘1995-Question 2’ in the accompanying “excel“spreadsheet for the analysis. Using Value lines cost of equity; the investment yields a negative Net Present Value (NPV) on the low end. The investment will not add value to the firm and the acquisition of GEICO doesn’t seem to be a good one. The high end range yields a positive NPV showing the investment rather is rather a prudent one. The discount rate used is highly subjective and is influenced by the risk premiums chosen...
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...Warren Buffett may be the most-popular man in Washington at the moment. The Oracle of Omaha charmed the 400 attendees at Fortune's Most Powerful Women Summit by playing his ukulele Tuesday night, earning a standing ovation from the likes of Facebook's Sheryl Sandberg and IBM's Ginni Rometty. During his one-on-one interview Wednesday with Fortune's Carol Loomis, he continued to win over the audience with his refreshing and positive outlook about his life, the economy and women in business. Still, he wasn't afraid to take on the dysfunction in Washington and said it was "so stupid" to even think that the U.S. could default on its debt. Highlights from Buffett's time on stage: On the fight over the debt limit: * "We have spent 237 years since 1776 building a reputation as the most wonderful country on earth, and one that's entrusted with having the reserve currency of the world. ... That is being put in jeopardy now and it could be destroyed in a little while. A great reputation is like virginity. It can preserved, but it can't be restored." * "The whole idea of a debt limit is a terrible, terrible mistake. If you're going to spend more than you take in, what are you going to do except raise the debt limit? So it becomes this political weapon of mass destruction. It really is like a nuclear bomb. It's something that maybe you talk about but never dream of using." On the economy: * "The country’s coming back. You can’t stop the United States. We get through everything...
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...IDOL : WARREN BUFFET INTRODUCTION Warren Buffett is an American business magnate, investor, and philanthropist and widely considered the most successful investor of the 20th century. Buffett is the chairman, CEO and largest shareholder of Berkshire Hathaway and consistently ranked among the world's wealthiest people. He was born to Howard and Leila Buffett in Omaha, Nebraska on 30th August 1930. He was the second of three children, and the only boy and his father was a stockbroker and four-term United States congressman. Howard Buffett served non-consecutive terms on the Republican ticket, but support libertarian views. He was quickly identified by his family and others as being exceptionally good with numbers. In his youth he made money by reselling cokes and delivering newspapers. At the age of 13 he filed his first tax return and deducted $35 for his bike as a business expense. Later, as a senior in high school, Buffett purchased a used pinball machine with a friend and set it up in a local barber shop. At his father's urging, he applied to the University of Pennsylvania and was accepted. Unimpressed, Buffett left after two years transferring to the University of Nebraska. After graduation, his father once again convinced him of the value of education, encouraging him to pursue a graduate degree. Harvard rejected Buffett, but Columbia accepted him. Buffett studied under Benjamin Graham, the father of value investing which is the beginning of his career. POSITIVE ATTRIBUTES ...
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...Case Study of Warren E. Buffet In 1995 Berkshire Hathaway has made a bid for the shares of GEICO. This report reviews the offer made by Warren Buffet and will try to prove that the acquisition of GEICO will serve the long-term goal of Berkshire Hathaway and the bid price was appropriate. Furthermore, it will explain what may have caused for the share price increase for Berkshire Hathaway at the announcement of GEICO’s acquisition. Would the GEICO acquisition serve the long-term goals of Berkshire Hathaway? In 1976, Warren Buffet paid $45.7 million for 34.25 shares of GEICO. Review of GEICO’s historical dividends shows that GEICO has been a very profitable investment for Berkshire Hathaway. The growth rate for 1994 is a sharp increase, but even if the growth rate for 1994 is not considered, GEICO’s historical increase in dividends has been considerably high so that acquisition of GEICO will serve the long-term goals of Berkshire Hathaway. What might account for the share price increase for Berkshire Hathaway at the announcement? Review of Warren Buffet’s historical investment success might explain the increase in share price for Berkshire Hathaway at the announcement. Given that he has had a good track record, it is expected that shareholders respond positively. In 1977, the price of Berkshire Hathaway was $89 closing at $25,400 by 1995, an unparalleled annual growth of 37.7%. In comparison, the growth rate of the S&P...
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...Warren Buffett is an American business magnate, investor, and philanthropist. He is one of the most successful investors in the world besides always be introduced as “legendary investor”. Furthermore, he is also one which is ranked among the world’s wealthiest people. In 2008, he was the world’s wealthiest person but his ranking was dropped and he was the third wealthiest person in world as of 2011. “Wizard of Omaha”, “Oracle of Omaha” or “Sage of Omaha” are the names those calls Warren Buffett. Warren Buffett is famous with his adherence to the value investing philosophy and his frugality despite his large wealth. Warren Buffett is also a popular philanthropist which has pledged to give 99 percent of his fortune to philanthropic causes, for example of the Gates Foundation. Warren Buffett was born on August 30, 1930. He is the only son to Howard which is a stockbroker-turned-Congressman. Warren Buffett began his education at Rose Hill Elementary School in Omaha. He continued his education at Alice Deal Junior High School after finished elementary school. In 1947, he was graduated from Woodrow Wilson High School. He was excellent in managing money and business at a very early age. When Warren Buffett was only six years old, he purchased 6 packs of Coca Cola from his grandfather’s grocery store with price of twenty five cents and resold each of the bottles for a nickel with earning five cents. When Warren Buffett was eleven years old, he bought three shares of Cities Service...
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...In 1930, Buffett was conceived in Nebraska he was a child of a stockbroker and Congressman. He has ended up presumably the planet's best guru. As a kid, regardless of his family foundation, he conveyed daily papers to profit and this most likely started his premium in the media where he has made a few fruitful speculations incorporating. According to the Washington Post Company, it was the stock which has made him like a cash ton. Furthermore, he did not offers such promises. Permeated with a determination make great and an entrepreneurial nature; however in 1950 his predetermination was contracted promptly in the piece when, in the wake of moving on through Nebraska university; he gave the preference to the Columbia Graduate Business School under the incredible Benjamin Graham. This endeavor grew into a multimillion dollar product globally. He was not having the knowledge related to the trademarks and patents and the importance of the logos and trademark in the large business companies. Due to lack of knowledge he was totally out of the business and his entire business undergo. The business venture has shown the promising indications related to the spirit of entrepreneurship as well as business acumen. Upon being wiped out from his previous business venture he in an individual capacity started to invest actively in the stock market and real estate, respectively until becoming virtually bankrupt. It was an understood fact that this magnitude of debt could not be repaid through...
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...1. Be prepared to discuss each aspect of Warren Buffet's investment philosophy. Do you agree or disagree? A basis in financial theory is preferred but not required tomorrow. Berkshire should continue its strategy based on Buffett's investment philosophy of purchasing undervalued assets. Over the past 40 years, Berkshire has increased shareholder value by an average of 21%, twice the average of the S&P 500 over the same period. Berkshire has a time tested set of rules for the best types of companies to acquire, namely to purchase businesses for less than they are worth. Berkshire must continue this strategy in order to increase shareholder wealth. Specifically, Buffett must use his investment philosophy that has made him so successful. He should continue to seek companies to invest or purchase that he understands and can purchase at a discount. The economic slowdown is an opportunity for Berkshire to find undervalued assets. Within the U.S. Buffett could look at the financial industry. He could also look at purchasing assets in a few years when the housing industry recovers. Given Buffett's investment philosophy, this would be an ideal time to purchase undervalued assets and hold them for a long time. Buffett should also be looking outside of the U.S. for investment opportunities. Brazil, India, Europe, and China are all opportunities. China's stock market is down significantly this year. This may be an excellent time for Buffett to search for bargains. Buffett...
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...Taylor Scott 1/28/13 Warren Buffett Case Analysis By analyzing the financial statements and Warren Buffett’s unique investment philosophy, the problem that must be answered is whether the acquisition of PacifiCorp increased Berkshire Hathaway’s intrinsic value. Buffett has a very unique way of measuring intrinsic value that would make it slightly more difficult to determine if this acquisition did, in fact, make Berkshire Hathaway more profitable. According to Warren Buffett, intrinsic value is “per-share progress”. Buffett assessed intrinsic value as the present value of future expected performance. For historical reference, Berkshire Hathaway has been outperforming the market since its inception in 1965. In 1977, the firm’s year-end closing share price was at $107. Fast-forward to May 24, 2005 and the closing price on BH’s Class A shares reached $85,500. Berkshire has had an annual increase of wealth of 24% since 1965, which is more than double the 10.5% of the average increase for other large stocks. It started out with a decline due to factors such as inflation, technological change, and competition from foreign competitors, but has come back strongly since it closed the textile side of its business operations. Most of this success can be attributed to Warren Buffett and his very unique investment philosophy that can be viewed very differently by many in the same field. According to the case, on the announcement day of the acquisition, Berkshire Hathaway class A...
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...Warren E. Buffett, 1995, Case Questions The purpose of this case is to introduce the themes that we will be covering in this course. In fact, if you look at Buffett’s investment philosophy (question 3 below) and compare it to the syllabus, you will find extensive overlap. 1. What is the possible meaning of the changes in the stock price for GEICO and Berkshire Hathaway on the day of the acquisition announcement? Specifically, what does the $718 million gain in Berkshire’s market value of equity imply about the intrinsic value of GEICO? (Note that Berkshire owned 33.25 million shares before the acquisition was announced.) Geico stock price will move up on the day of the acquisition announcement. Meant, GEICO intrinsic value also increase, total value will be more than $718 million in the market. 2. How well has Berkshire Hathaway performed? In the aggregate? In its investment in Scott & Fetzer? In its investment in earlier purchases of GEICO stock? Scott & Fetzer conservatively financed with Berkshire Hathaway. Buffett offered to buy the company for $315 million. Scott and Fetzer paid Berkshire Hathaway $125 million. Buffett noted that in terms of return on book value of equity, Scott & Fetzer would have easily beaten the Fortune 500 firms. 3. Please critically assess Buffett’s investment philosophy, and prepare to identify points where you agree and disagree with him. Graham’s approach was to focus on the value of assets, such as cash, net working...
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...Warren Buffett and Gillette Background of the Active Investor Warren Buffett is known as one of the world’s most notable investors. He is a self-made investor, now worth billions of dollars. Buffets premise is that people should base their investing on common sense and search out assets that are selling for less than they are worth (Pardoe, 2005). At an early age Buffett had a knack for making money. At six year old, Buffett made a five cent profit by purchasing a six-pack of Coca-Cola for twenty-five cent and reselling each bottle for a nickel. At eleven, he purchased three shares of Cities Service at $38 per share. Shortly after buying the stock, it fell to just over $27 per share (Kennon). When the shares rebounded to $40 he sold the shares, but regretted his actions when the shares shot up to $200. The experience taught him that patience is a virtue (Kennon). Buffett was a graduate of the University of Nebraska-Lincoln. Some time after graduation, Buffett had the opportunity to work for his mentor, Ben Graham, on Wall Street. There, he spent his day analyzing S&P reports, searching for investment opportunities (Kennon). He took a different interest than that of his mentor, he became interested in how a company worked, what made it superior to competitors and observed how the company was managed when deciding to invest; he was not interested in the corporate leadership of the companies he researched and invested in. In the mid-1950’s Buffett aligned himself...
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...Warren Buffet When people think of one of the brightest minds of the investing world, there is one person that is on every persons mind. That person is the ‘Oracle Of Omaha’ or Warren Buffett. He is a man with dignity and respect that made him a self-made billionaire with working hard. One of his greatest quotes by Warren is “Price is what you pay. Value is what you get.” What Warren means by this is that you are going to have to pay a price for everything, but what you do with it is what you are going to get out of it. Going through his early days to where he is know he has gone through quite a journey that now puts Warren worth $66.7 billion (toolsforforex.com, 2013). People don’t just look up to Warren because he is one of the richest people in the World; he also has one of the kindest hearts with what he does with a lot of his riches. Warren has done many things in his life for people to be inspired by him starting with he has always worked for what he has in his life. In 2008 Warren was declared the richest person in the world. People don’t just looked up to him because of his money he has made alone. In 2006 Warren announced that he would donate 85% of Berkshire Hathaway’s holdings when he dies. He has also won the Presidential Medal of Freedom in 2011 from Barack Obama for helping some companies out during the financial crisis (The Famous People). Besides his career and philanthropy he is involved in, he also has a family. Warren was married to Susie Warren...
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...WARREN BUFFET The Omaha Miracle 12/ 16/ 2008 Business English 1 WARREN BUFFETT The Omaha Miracle Table of Content I III IV IV Biography / Historical Timeline Berkshire Hathaway Buffet’s Principals Sources 12/ 16/ 2008 Business English 2 WARREN BUFFETT The Omaha Miracle Warren Buffett was the richest man in the world 2008. 12/ 16/ 2008 Business English 3 WARREN BUFFETT The Omaha Miracle He’s a self-made man with a fortune of around $62 billion. 12/ 16/ 2008 Business English 4 WARREN BUFFETT The Omaha Miracle Croatia’s GDP was actually $63 billion in 2008. 12/ 16/ 2008 Business English 5 WARREN BUFFETT The Omaha Miracle He lives in the same house in Omaha, Nebraska that he bought in 1958. 12/ 16/ 2008 Business English 6 WARREN BUFFETT The Omaha Miracle But Mr. Buffett doesn’t live here… 12/ 16/ 2008 Business English 7 WARREN BUFFETT The Omaha Miracle …he actually lives here. 12/ 16/ 2008 Business English 8 WARREN BUFFETT The Omaha Miracle Is this his car? 12/ 16/ 2008 Business English 9 WARREN BUFFETT The Omaha Miracle Well this is. 12/ 16/ 2008 Business English 10 WARREN BUFFETT The Omaha Miracle Like every American he’s also pretty much into sports and even sponsors an international tournament. 12/ 16/ 2008 Business English 11 WARREN BUFFETT The Omaha Miracle The Warren Buffett Bridge Cup to be exact. 12/ 16/ 2008 Business English 12 WARREN BUFFETT The Omaha Miracle ...
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