Tags: Barrons Berkshire Could Pay Dividend in 12 to 18 Months

Barron's: Buffett's Berkshire Could Pay Dividend in 12 to 18 Months

Monday, 24 January 2011 10:11 AM

Warren Buffett's Berkshire Hathaway could pay a dividend in the next 12 to 18 months, according to a report in the Jan.24 issue of Barron's.

Berkshire had $30 billion in cash in its insurance units as of Sept.30.

It could have nearly $50 billion by year end, according to the report.

Berkshire's operating profit after taxes is on track for a record $12 billion to $13 billion in 2011, buoyed in part by Berkshire's purchase of the Burlington Northern railroad, Barron's wrote.

It is also likely that Berkshire's investments in Goldman Sachs, General Electric and others — made during the financial crisis — could be repaid.

Such an influx of cash could prompt Berkshire to begin paying a dividend in the next year to year and a half, Barron's wrote — especially if Buffett fails to find another large investment.

Berkshire hasn't paid a dividend since Buffett took control in 1965. Instead, it has re-invested its profits.

However, the extra cash, rising asset and equity values, and Buffett's impending retirement could make a dividend an attractive option, Barron's wrote.

Decreasing Berkshire's cash pile ahead of Buffett's retirement would remove some of the pressure on Buffett's successor to immediately invest, according to the report.

A Berkshire dividend is expected to start out small, at 2 percent or less, according to the report.

© 2020 Thomson/Reuters. All rights reserved.


   
1Like our page
2Share
StreetTalk
Warren Buffett's Berkshire Hathaway could pay a dividend in the next 12 to 18 months, according to a report in the Jan.24 issue of Barron's. Berkshire had $30 billion in cash in its insurance units as of Sept.30. It could have nearly $50 billion by year end, according to...
Barrons Berkshire Could Pay Dividend in 12 to 18 Months
218
2011-11-24
Monday, 24 January 2011 10:11 AM
Newsmax Media, Inc.
 
Newsmax TV Live

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved