Warren buffett letter to shareholders

• Berkshire Hathaway wan't able to buy large, potentially profitable businesses or increase its operating earnings in 2020. • Berkshire's per-share intrinsic value increased during the year due to • Buffett paid too much for metal manufacturing company Precision Castparts in 2016. • Buffett believes that "a non-controlling portion of a wonderful business is more profitable, more enjoyable and far less work than struggling with 100% of a marginal enterprise." • Berkshire's most valuable assets are its property/casualty insurance operation, its 5.4% ownership of Apple, its 100% ownership of BNSF Railway, and its 91% ownership of Berkshire Hathaway Energy. 2 Goals Berkshire Did Not Meet Buffett begins his annual letter with a quick rundown of Berkshire's performance in 2020. Its results, filed in accordance with Operating earnings are what count most, even during periods when they are not the largest item in our GAAP total. Our focus at Berkshire is both to increase this segment of our income and to acquire large and favorably-situated businesses. Last year, however, we met neither goal: Berkshire made no sizable acquisitions and operating earnings fell 9%. What’s out of sight, however, should not be out of mind: Those unrecorded retained earnings are usually building value—lots of value—for Berkshire. Investees use the withheld funds to expand their business, make acquisitions, pay off debt, and often to repurchase their stock (an act that increases our share of their future...