A company can have a great product. Or a great marketing team. But if management isn’t good… the company will falter. Even a manager who knows to step aside for the team is better than an executive who makes the wrong decisions and ignores what the staff has to say.
This can translate into great stock returns… or poor ones. So all said and done, company management is a key factor, even though it doesn’t show up on the balance sheet.
Investing with management teams that support shareholders – and are big shareholders themselves – can be crucial for investment success.
And in today’s market, that makes a strong case for Berkshire Hathaway (BRK-B). The insurance and conglomerate company is aptly managed by Warren Buffett.
More interestingly, the company hasn’t yet moved to take advantage of fears in the banking industry. Once they do, they’ll likely get top dollar on their returns. Buffett employed a similar strategy to buy preferred shares yielding 10 percent from several banks, getting returns unavailable to anyone else.
Action to take: Although Berkshire somewhat famously doesn’t pay a dividend, shares are worth accumulating for the long haul.
For traders, the B shares offer options trading. The July $330 calls, last going for about $9.60, offer mid-double-digit returns on a continued move higher in shares.
Disclosure: The author of this article has a position in the company mentioned here, but does not intend to trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.