Warren Buffett.
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Berkshire Hathaway bought back about $2 billion of stock in the first quarter through early March, Barron’s estimates.
Our estimate is based on the share count of Berkshire Hathaway (ticker BRK/A, BRK/B) disclosed in its proxy statement as of March 2, ahead of the company’s annual meeting on April 30. The statement, including details such as the pay of key executives and a proposal for the company to have an independent chairman, was made public late on Friday.
Berkshire also disclosed in its proxy that investment manager Wallace Weitz, 72 years old, has been nominated to the Berkshire board and would be its 15th member if approved by shareholders.
Weitz founded the Omaha-based Weitz Investment Management, whose Weitz Value mutual fund (WVALX) counts Berkshire as one of its largest holdings. Weitz will succeed longtime director Thomas Murphy, who retired from the board earlier this year.
Berkshire’s stock repurchase activity has slowed since 2021 when it bought back $27 billion of stock, or an average of about $7 billion a quarter, as the stock price has risen in 2022. The pace of the buybacks, however, has picked up since mid February; the total for the current quarter could be in the $4 billion range at the recent pace.
Berkshire’s Class A shares have been strong this year and hit a record high Friday before closing at $489,802, up 0.4%. The stock is up 9% this year, handily topping the S&P 500 which is off about 11%. Berkshire’s Class B shares ended Friday at $326.66, up 0.4%.
Berkshire has benefited this year as a haven stock thanks to the company’s fortress balance sheet, with nearly $150 billion in cash, and a diversified stream of operating profits that totaled $27 billion last year after taxes.
CEO Warren Buffett’s salary of $100,000 in 2021 was unchanged from 2020 and hasn’t changed for at least 25 years. Buffett doesn’t want to be paid more and doesn’t get a bonus, the proxy noted. His total compensation of $373,204 for 2021 reflected payments for security services of $273,204 provided by the company. That amount was little changed from 2020.
Buffett, 91, as usual wrote a check to Berkshire for $50,000 to offset postage, other incidental expenses, and occasional use of Berkshire personnel for personal reasons.
“Mr. Buffett reimburses Berkshire for these costs by making an annual payment to Berkshire in an amount that is equal to or greater than the costs that Berkshire has incurred on his behalf,” the proxy stated.
Berkshire vice chairmen Ajit Jain and Greg Abel each earned $19 million in cash and bonus during 2021 with a $16 million base and $3 million bonus. Their compensation hasn’t changed in three years. Jain heads Berkshire’s insurance operations and Abel runs the non-insurance businesses.
Unlike at most big companies, there is no complex formula for determining pay of top Berkshire executives. Buffett decides what to pay Jain, Abel and CFO Marc Hamburg.
“Factors considered by Mr. Buffett in setting the compensation for Mr. Abel, Mr. Jain and Mr. Hamburg are typically subjective, such as his perception of each of their performance and any changes in functional responsibility,” the proxy said.
Berkshire doesn’t give stock-based compensation to its top executives.
There is a proposal in the proxy for Berkshire to name an independent chairman, which would mean that Buffett couldn’t hold that role, as well as CEO, as he now does.
This is common at many companies and some view such a separation as good corporate governance. Berkshire’s board unanimously urged shareholders to reject that proposal, stating:
“ Warren Buffett, Berkshire’s CEO, currently has a 32% voting interest in Berkshire. The Board believes that as long as Mr. Buffett is Berkshire’s CEO, he should continue as Board Chair and as Berkshire’s CEO.”
Write to Andrew Bary at [email protected]
