FEBRUARY 27, 2010, 8:11 A.M. ET
By Scott Patterson
Of THE WALL STREET JOURNAL
Download the 2009 Warren Buffett Letter & 2009 Annual Report to Berkshire Hathaway Shareholders
A strong stock market and a steady stream of premiums from its vast insurance holdings helped Berkshire Hathaway Inc. bounce back last year from a rough 2008, but it underperformed the broader market, results released early Saturday showed.
(This story and related background material will be available on The Wall Street Journal Web site, WSJ.com.)
In his widely read annual letter, Warren Buffett reported that Berkshire in 2009 gained 19.8% to $84,487 in book value per share from $70,530 last year, a common metric the company uses to track performance. That marks a strong rebound from 2008, when book value per share slid 9.6%, the biggest decline since Buffett took over the company in 1965 when it was a family-run East Coast textile manufacturer.
In dollar terms, it was one of the biggest annual increases in Berkshire’s shareholder equity on record.
Still, it was less than the Standard & Poor’s 500-stock index’s return of 26.5% in 2009. The year marked only the seventh time Berkshire has trailed the index under Buffett.
Since 1965, Berkshire has gained 20.3%, compared with the S&P 500’s 9.3% total return. In mid-February, Berkshire entered the S&P 500, opening up the company to a broader range of investors.
Berkshire’s Class A shares gained just 3% in 2009. Still, Berkshire appears to be recovering solidly as the economy pulls out of its steep dive. Its shares have been on a roll of late as well, gaining nearly 20% since early November, when Berkshire said it planned to purchase the railroad giant Burlington Northern Santa Fe for $26 billion. The stock joined the S&P earlier this month.
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Download the 2009 Warren Buffett Letter & 2009 Annual Report to Berkshire Hathaway Shareholders
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