*from www.bloomberg.com, Mar. 4, 2013 (To view original article click here.)
Take Away #1: Stock pickers Todd Combs and Ted Weschler will again receive more money to invest from Berkshire Hathaway Inc. (BRK/A) after beating the S7P 500 Index and left Warren Buffett “in the dust”.
Key Facts and Figures:
- The deputies, who made profitable bets on companies like Visa Inc. (V) and DaVita HealthCare partners Inc., each over see almost $5 billion for Berkshire Hathaway, according to Buffett’s annual letter to investors March 1.
- The amount is up from $4 billion outlined in July and reflects confidence that the two managers are capable of running Berkshire’s more than $80 billion of stocks one day.
- “We hit the jackpot with these two,” wrote Buffett, CEO of Berkshire Hathaway.
Take Away #2: Warren Buffett is preparing giant firm Berkshire Hathaway for new leadership.
Key Facts and Figures:
- Stock picks and takeovers transformed Berkshire Hathaway from a failing textile maker into a $250 billion firm with more than 80 operating units.
- Continuing that track record will fall to Weschler, 51, and Combs, 42, who were hired in the past three years to help pick stocks.
- Buffett continues to oversee the largest investments in Berkshire’s portfolio, while his deputies will make bets from “a couple of hundred million” dollars to $1 billion.
Take Away #3: Buffett is building up Combs and Weschler, promoting their records to shareholders showing that he hired the right manager to succeed him.
Key Facts and Figures:
- Combs and Weschler beat the S&P 500 by “double digits” last year, Buffet said.
- The Index returned 16 percent including dividends in 2012.
- Some of the smaller holdings in Berkshire’s portfolio, Visa (V) and MasterCard Inc. (MA) rose more than 30 percent last year.
- At least one of their picks climbed past $1 billion in value, Buffett wrote.
- DirecTV (DTV) which both Weschler and Combs invested in, is the first stock not picked by Buffett himself, to be included in a list of the companies largest holdings in the annual report, said Buffett.
Take Away #4: Combs and Weschler portfolios to receive another $1 billion boost and both will make decisions independently of Buffett.
Key Facts and Figures:
- Buffett will boost each manager’s portfolio to $6 billion at the end of this month.
- While he had previously said he may hire an additional manager to oversee investments, Weschler and Combs’ performance has made that less necessary, Buffett said.
- Weschler and Combs each earn a salary of $1 million as well as 10 percent of the amount by which their portfolios outperform the S&P 500 on a three-year rolling basis.
- 20 percent f each managers performance pay is based on the other’s results as an incentive to collaborate.
- Neither consults with Buffett on what to buy.
*To view original article from www.bloomberg.com click here.