If you had put $95 into Warren Buffett's Berkshire Hathaway 59 years back, this is the sum you would possess now.
Almost everyone is familiar with the fact that Warren Buffett is one of the greatest investors in history. Over close to 60 years, he's managed to boost the value of shares in his company, Berkshire Hathaway (BRK.A -0.13%, BRK.B -0.16%), at an average annual rate of 19.8%. In contrast, the S&P 500 index only increased by 10.2% annually during the same period.
Let's imagine you invested approximately $100 in Berkshire Hathaway back in 1965, when Buffett took control of the struggling textile company. The cost of a share back then was roughly $19.
Buffett has always been against stock splits, but he did create a second class of shares – B shares, as opposed to the original A shares – where 30 class B shares are equivalent to one class A share. He then split these class B shares 50-to-1 as part of the acquisition of the Burlington Northern Santa Fe (BNSF) railroad. As a result, one class A share is now equal to 1,500 class B shares, with the latter recently trading at around $460 each.
However, class A shares have never been split. If you had invested roughly $100 worth of shares back in 1965, that would have been about five shares, totalling $95. Today, those un-split class A shares are worth nearly $700,000 each (yes, a single share!). Therefore, that initial $95 investment would be worth nearly $3.5 million now, after 59 years.
Even if you're not currently a Berkshire Hathaway shareholder, you can still become one by purchasing some class B shares. Doing so would make you a part-owner of numerous businesses owned by Berkshire, such as the insurer GEICO, Benjamin Moore paints, and See's Candies, as well as having a stake in Berkshire's stock portfolio, which includes major positions in companies like Apple and American Express.
It's clear that there are numerous compelling reasons to consider investing in Berkshire Hathaway, and its future remains promising -- even if it doesn't increase at the same rate as it once did.
If you decide to invest in Berkshire Hathaway, you're not just purchasing a share of the company, but also gaining ownership of various businesses like GEICO and See's Candies. Money wisely invested in Berkshire Hathaway back in 1965, when Buffett took control, would have seen a significant return, with a single share currently worth nearly $700,000. This highlights the potential returns that can be derived from long-term investing in finance and the stock market.
