The man is Warren Buffett.
REUTERS/Rick Wilking
This week, Warren Buffet's company had a market cap of $700 billion. Most CEOs would be celebrating the achievement, however, Buffett may have mixed feelings.
The legendary bargain hunter is itching to spend half of the cash pile, but he's struggled to find deals in recent years. Private equity firms are pricing him out of acquisitions as stocks have climbed to record highs.
Short of options, he has been increasing stock purchases. The company bought a record $25 billion of its shares in 2020. The investor emphasized that he will only buy back shares at a price below his estimate of the intrinsic value.
"It's hard to go wrong when you're buying dollar bills for 80 or 888-282-0465 888-282-0465 888-282-0465 888-282-0465 888-282-0465 888-282-0465," said the 2012 shareholder letter from Warren Buffet.
If the price of his stock goes past his ceiling, he will have to stop his purchases or rein in his spending.
The investor pegged the value of the company's businesses at around $700 billion last year, suggesting he might not see its shares as a bargain any longer.
There's reason to believe that Buffett puts a higher value on the company. In 2008, the so-called "Oracle of Omaha" told his shareholders that the company could theoretically be acquired for more than $200 billion.
He said there was no guarantee that a $600- or $700 billion takeover would be possible.
13 years ago, he considered $700 billion to be a fair offer for the company, even though he was pricing in a takeover premium. Since then, his company's net assets have doubled in value to $450 billion, and he probably values it more highly today than he did in the past.
The Smead Value Fund beat 99% of its peers. The managers share where they're putting their money and they're betting big on 3 of them.
Business Insider has an original article.
