End of an era for Oracle of Omaha

Apple’s Tim Cook called him inspiring. Bank of America’s Brian Moynihan praised his lessons on life and business. JPMorgan’s Jamie Dimon said he’s “everything that is good about American capitalism.” 

As Warren Buffett called an end to his historic run atop Berkshire Hathaway, luminaries from the technology and banking worlds rushed to praise the man whose lessons they partially credit for their success. 

Buffett, who built Berkshire Hathaway into a business valued at more than $1.16 trillion and himself into a celebrity billionaire renowned for his investing acumen and witticisms, will step down at year-end after six decades atop the conglomerate.

The famed investor delivered a more than 5,500,000% return on Berkshire’s stock as he turned a once-failing textile firm into the most valuable company in the world that isn’t either a tech giant or a state oil producer.

In the process, he became the rare investor who crossed over into public consciousness through his folksy wisdom and witticisms. 

Buffett has drawn scores of imitators and become synonymous with many of the investing themes that still dominate the financial industry: being greedy while others are fearful, practising patience in allowing investments to compound and identifying insurance as a source of stable funds.

Cook, Moynihan and Dimon were among those who said they’d personally learned from Buffett. 

“There’s never been someone like Warren,” Cook said on social media after Buffett surprised his investors with the announcement that he’d step down as CEO by year-end. “Countless people, myself included, have been inspired by his wisdom.”

Berkshire racked up many measures of its success and heft as it branched into more and more sectors, with some 180 operating businesses now driving annual revenue of nearly $400 billion.

The conglomerate holds railroads, power utilities, gas stations, auto dealerships, home builders, chemical producers and real estate brokers.

It also has household brands including Geico, Dairy Queen, Fruit of the Loom, Duracell, Helzberg Diamonds and See’s Candies. 

Buffett’s Berkshire legacy

Berkshire has also built up a formidable pile of cash, now at a record $347.7 billion at the end of the first quarter. That’s bigger than all of the Ivy League university endowments combined.

It also owns roughly 5% of the Treasury bills in circulation and last year paid what Buffett himself called the biggest corporate tax bill in US history at nearly $27 billion.

Lately, Buffett has been waiting for a big opportunity to deploy his growing cash pile, a decision he apparently will pass to Greg Abel, his hand-selected successor as CEO. 

 While Cook and others have expressed confidence in Abel, his boss will be a tough act to follow. 

“Warren Buffett represents everything that is good about American capitalism and America itself — investing in the growth of our nation and its businesses with integrity, optimism, and common sense,” Dimon said.

“I’ve learned so much from him to this very day, and I am honored to call him a friend.”

“His life lessons delivered to young and old are as valuable as his business acumen,” Moynihan said. “I have personally learned so much from him and look forward to continuing to benefit from his insights.” 

Here’s a look at what Buffett built, with his longtime business partner, the late Charlie Munger, over his six-decade run:

• 5,502,284% – Overall gain from 1964 to 2024 in per-share market value of Berkshire Hathaway. (The same figure for the S&P 500 stock index, with dividends included, is 39,054%.) That translates to an annualised return of nearly 20%, almost double that of the S&P over the same period.
• $1.2 trillion – The current market capitalisation of Berkshire, the eighth-highest in global public markets 
• 392,396 – Number of people Berkshire companies employed at year-end
• $167 billion – Value of Warren Buffett’s Class A shares in Berkshire Hathaway
• 1 – Number of times Berkshire paid a dividend between 1965 and 2024. Buffett wrote in his most recent letter to investors that paying a dividend in 1967 “seems like a bad dream.”

Buffett is known most widely for his public stock-picking prowess, and a small group of stocks – Apple, American Express, Coca-Cola, Bank of America and Chevron – accounted for some 70% of his $263 billion stock portfolio.

As Buffett put it, “one wonderful business can offset the many mediocre decisions that are inevitable”.