In a study of analyst recommendations at the major brokerages, for the underlying components of the S&P 500, CBRE Group Inc (NYSE: CBG) has taken over the #1 spot from Berkshire Hathaway Inc. (NYSE: BRK.B), according to ETF Channel. Below is a chart of CBRE Group Inc versus Berkshire Hathaway Inc. plotting their respective rank within the S&P 500 over time (CBG plotted in blue; BRK.B plotted in green): …read more
Source: FULL ARTICLE at Forbes Markets
By Steve Symington, The Motley Fool
Filed under: Investing
As highly as we Fools think of Warren Buffett and Berkshire Hathaway , we’d be foolish (with a lower-case “f”) to believe any company is truly without risk.
With that in mind, here are six ways Berkshire could potentially fail investors going forward:
1. Losing to the market on Buffett’s terms
Over the years, Buffett has largely made his name by identifying stocks whose share prices have lagged the intrinsic value of their underlying businesses. As a result, it should come as no surprise that Buffett believes the best way to measure Berkshire’s performance is by calculating its book value.
Sure enough, as I noted last month, Buffett himself lamented Berkshire’s respectable 2012 book value growth of 14.4% as “subpar” after it fell short of the S&P 500’s 16% gain.
What’s more, while Buffett has helped Berkshire’s book value per share rise an astounding 586,817% over the past 48 years (seriously — that’s no typo!), he readily admits that, with Berkshire’s enormous capital base, its book value per share going forward will probably have a hard time increasing “at a rate even close to its past rate.”
2. Losing to the market on Mr. Market’s terms
Even if Berkshire’s book value per share manages to outpace the broader market‘s return, you can bet that if the share price lags, many fickle investors still won’t be patient enough to wait for the price to catch up with the value of the business.
Of course, that is part of why it’s so hard to be a value investor, but the fact remains that there will be more years during which Berkshire Hathaway stock will lag the market. For example, look at how much faster Berkshire’s book value has increased relative to both its share price and the S&P 500 over the past five years:
BRK.B Total Return Price data by YCharts
While this isn’t necessarily Berkshire’s fault, you can bet many investors will inevitably perceive it as a failure.
3. Failure to maintain superior management
As Peter Lynch once said, “Go for a business that any idiot can run — because sooner or later, any idiot probably is going to run it.”
Before you go yelling “Blasphemy!” from the rooftops, I’m all too aware that Berkshire’s current management team is as solid as they come. Heck, there are at least six people with whom I wouldn’t be surprised should they be chosen as Buffett’s eventual successor.
Until that time comes, however, nobody can be positive that Berkshire’s future management team will be able to even partially replicate the success of the unrivaled team that is Buffett and Charlie Munger.
Without a doubt, Buffett has done marvelously well investing both Berkshire’s shareholder equity and insurance float in stocks. Over the years, Buffett has amassed enormous positions in now-legendary stocks such as Coca-Cola , American Express , Wells Fargo , and Procter & Gamble . Sure enough, take a look at what Buffett’s patience had achieved with these four stocks as of the end of
Source: FULL ARTICLE at DailyFinance
Filed under: Mergers & Acquisitions, Food & Beverage, Stocks, Warren Buffett
PITTSBURGH — Burger King CEO Bernardo Hees will take the top job at Heinz following its acquisition by investment firm 3G Capital and Warren Buffett’s Berkshire Hathaway Inc. (BRK.B).
Hees, 43, has been CEO at Burger King, another 3G Capital investment, since 2010. Before that, Hees was CEO of America Latina Logistica, Latin America‘s largest railroad and logistics company.
He will remain CEO at Burger King until the deal closes. Likewise, Heinz Chairman and CEO Bill Johnson will retain that job until the acquisition of the company closes.
The investors announced plans in February to buy Pittsburgh-based H.J. Heinz Co. (HNZ) in a $23.3 billion deal. Heinz shareholders are set to vote on the acquisition at a meeting April 30.
The deal is expected to close in the second or third quarter and still awaits regulatory approval in some countries and the European Union. U.S. authorities have already signed off on the deal.
3G Managing Partner Alex Behring said in a statement that Hees’ experience in the food industry makes him the ideal leader for Heinz.
Berkshire and Brazilian investment firm 3G said they will discuss a continuing role with Heinz with Johnson.
At Miami-based Burger King Worldwide Inc. (BKW), Chief Financial Officer Daniel Schwartz will become chief operating officer and will take the CEO job on July 1.
Hees led a campaign to revamp Burger King‘s menu and marketing. The menu moves helped boost the burger chain’s profit in the fourth quarter.
But now, the world’s second-biggest hamburger chain says it needs to play up value more aggressively to compete with rivals.
On Wednesday, Burger King said it expects revenue at restaurants open at least a year fell 1.5 percent in the first quarter. The figure is considered critical because it strips out the effects of locations that opened or closed during the year.
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From: http://www.dailyfinance.com/2013/04/11/burger-king-heinz-buyout/
By GuruFocus, Contributor According to Guru Arnold Van Den Berg‘s value investor wisdom: “The lesson for investors is that even though the economy may not be in great shape, when stocks sell at deeply discounted prices relative to their intrinsic values, thus accounting for all the seemingly insoluble problems of the time, stocks should be bought aggressively.” At a recent public employment retirement systems conference in Texas, Guru Arnold Van Den Berg, CEO and co-chief investment officer of Century Management, summarized the three investment performance drivers as inflation, interest rates and business fundamentals. Business trends in the U.S. look very positive for the long run, according to Van Den Berg, who also warned that the valuations of stocks and bonds warrant caution. He explained that inflation must be monitored, and added that their direction will be determined by what the Federal Reserve does, telling the audience that the most important thing is not to get locked into an opinion until they see what the Federal Reserve is going to do. …read more
Source: FULL ARTICLE at Forbes Latest
By Business Wirevia The Motley Fool
Filed under: Investing
The Dairy Queen ® System Launches Value Lunch
$5 Buck Lunch includes a signature
DQ ®
MINNEAPOLIS–(BUSINESS WIRE)– Rising gas prices, increases in the federal payroll tax and overall economic uncertainty have left consumers yearning for more value for their take-home dollar, particularly when eating out.
According to an online survey conducted by Harris Interactive in March 2013 and commissioned by the Dairy Queen® system, which is a Berkshire Hathaway (NYSE: BRK.A and BRK.B) company, price is an important consideration in choosing where to go for lunch. The survey results were announced as part of the April 1 launch of DQ® $5 Buck Lunch.
“Our $5 Buck Lunch is really big news for the Dairy Queen system. In this current economic climate, consumers are looking for value, particularly at lunch,” said Barry Westrum, executive vice president of Marketing for American Dairy Queen Corporation (ADQ). “According to our survey, we also hit the mark by offering a lunch that includes, at no extra cost, choice of a sundae.”
According to the survey, 93 percent of American adults that dine out for lunch said that price is important when choosing their destination. In addition, more than half (51 percent) of millennials (aged 18-34) are more likely to make a complete meal choice for lunch if it includes a dessert. When asked about favorite toppings for a sundae, more than two thirds (65 percent) of those who eat ice cream sundaes said hot fudge was their favorite.
The DQ® $5 Buck Lunch is available daily from 11 a.m. to 4 p.m. at participating locations. Fans have a choice for their $5 Buck Lunch of a ¼ lb. GrillBurger™ with cheese, 3-piece Chicken Strip Lunch or a Chili Cheese Dog, which are all served with fries, a beverage and choice of a sundae. For just $1 more, fans also will have the option to upgrade their small sundae to a small Blizzard® Treat, including Choco Covered Pretzel, the featured Blizzard Treat of the Month for April.
“Only at Dairy Queen restaurants can you enjoy a $5 Buck Lunch that comes with a treat,” said Westrum. “Since hot fudge was the number one topping choice for a sundae, we’ll make sure we have enough to satisfy that craving. Our $5 Buck Lunch offer is an irresistible every day reward for our fans.”
Offer may vary …read more
Source: FULL ARTICLE at DailyFinance
By Business Wirevia The Motley Fool
Filed under: Investing
The Dairy Queen ® System Continues International Expansion
Quick service restaurant and treat leader opens newest location in Trinidad
MINNEAPOLIS–(BUSINESS WIRE)– The Dairy Queen® system, part of Berkshire Hathaway (NYSE: BRK.A and BRK.B), has opened its latest location in Trinidad, which is the 20th country outside the U.S. and Canada with a DQ® presence.
“The international marketplace has always presented a huge opportunity to grow the Dairy Queen brand,” said John Gainor, chief executive officer of International Dairy Queen, Inc. (IDQ). “The Dairy Queen system saw tremendous growth internationally last year with 215 restaurants outside the U.S. and Canada, which included the opening of our 100th location in Mexico. Through our partnership with PELINJA Holdings LTD, we are thrilled to now offer the residents and tourists in Trinidad the same exceptional treats and menu items that our fans already enjoy around the world.”
PELINJA Holdings LTD opened a DQ Treat location in Port of Spain, Trinidad. PELINJA Holdings LTD is scheduled to open three new locations in the next couple of months and is planning many additional locations in Trinidad over the next few years.
The Trinidad DQ restaurant features the full line of DQ classic treats, as well as delicious hot dogs and DQ Cakes.
The Dairy Queen system has more than 6,100 locations, 1,109 of which are outside the U.S. and Canada. For more information about the Dairy Queen system, visit DairyQueen.com.
About IDQ:
International Dairy Queen Inc., (IDQ), which is headquartered in Minneapolis, Minn., is the parent company of American Dairy Queen Corporation (ADQ), which develops, licenses and services a system of more than 6,100 Dairy Queen® and Orange Julius® stores in the United States, Canada and 20 other countries. IDQ and ADQ are part of the Berkshire Hathaway family, a company owned by Warren Buffett, the legendary investor and CEO of Berkshire Hathaway. For more information, visit DairyQueen.com.
Pierson Grant
Lauren Simo, 954-776-1999, ext. 238
lsimo@piersongrant.com
Jenna Leon, 954-776-1999, ext. 242
jleon@piersongrant.com
KEYWORDS: United States North America Caribbean Minnesota Trinidad and Tobago
INDUSTRY KEYWORDS:
The article The Dairy Queen® System Continues International Expansion originally appeared on Fool.com.
By Martin Sosnoff, Contributor
If Warren Buffett has emancipated himself from stock picking, what is the residual Berkshire Hathaway all about and what is it worth? Bottom line, BRK is worth what it’s selling for, but there is no dream that Warren comes up with another Coca-Cola, American Express or even Wells Fargo, which I regard as an old maid’s bank stock. …read more
Source: FULL ARTICLE at Forbes Latest
