As Buffett Sayeth, So Shall It Be!
Warren Buffet is a prophet of the marketplace–a billionaire who has made his money by valuing stock correctly. He is called, in some quarters, the Oracle of Omaha (his hometown) because of his ability to accurately predict the economy’s actions, as well as the operations of various businesses that effect their stock values. Mere words from his mouth can cause stock prices or values to jump for a particular company. This time, it was his own company, a subject about which he has rarely discussed publicly:
Buffett, who is chairman and chief executive officer of Berkshire, is planning to fund the Burlington Northern deal with Berkshire stock that’s fallen by about than a third from its 2007 high. He has chastised Kraft Foods Inc. CEO Irene Rosenfeld for issuing shares of the foodmaker to help fund its purchase of Cadbury Plc. Berkshire is the largest stock investor in Kraft.
“Both Kraft and Berkshire are undervalued,” he said. While he was reluctant to issue shares of his company at its current price, Buffett said “I’m still OK with it” based on his assessment of the railroad. “But it’s close.”
More on the Oracle and how much he values his company here.