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Buffet Announces a Buy Back

Tuesday Sept 27, 2011

Monday morning Warren Buffet announced he would be buying back shares of Berkshire Hathaway.

The market reacted by jumping the shares about ten percent. And sure enough the analyst above is right, at 98K BRK.A is trading for book value. Please read the analysis. As he says, Buffet does not own options, he owns the stock. Buying shares means there will be fewer shares in the market place, raising the earnings per share. Presumably that will boost the stock price as earnings increase. Note the overall market rallied nicely, see our companion blog http://www.themarketperspective.com.

 

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3 responses to “Buffet Announces a Buy Back”

  1. raquel Nunez Avatar
    raquel Nunez

    Its interesting when Mr. Buffet stated that he was buying back Berkshire shares, it seems or will seem that everyone jumps at the opportunity that its a great investment. Maybe Mr. Buffet should say he’s buying shares with American Airlines, maybe with his name alone it will help AA’s current situation. Just thinking out loud. The Buffet name is the key.

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  2. Luis Martinez Avatar
    Luis Martinez

    If that were the case, I suspect companies would go out of their way to court Mr. Buffet (perhaps even pay him to buy their stock publicly). He’s probably too practical and savvy to go around buying stock to help other industies.

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  3. Dennis Elam Avatar
    Dennis Elam

    That’s a pretty creative idea but Buffet hates airlines, but yes that might help AMR!

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