January 1, 2022
Capital Allocation: The Financials of a New England Textile Mill (1955 – 1985)
Jacob McDonough
There are probably hundreds of books written about Warren Buffett. The team has read many of them, but this one sticks out as being unique. Buffett started buying Berkshire Hathaway in 1962 and took control in 1965. The author provides financial details and interesting tidbits behind some of the important early transactions that propelled the company beyond its textile mill roots. Cost-cutting, tax loss carry-forwards, share buybacks, and stock purchases all contributed to the early Berkshire transformation. The purchase of National Indemnity and See’s Candy – the combination of float, a value focus, and excellent businesses – were the key raw materials for the Berkshire compounding machine.