Barron’s has an article on Berkshire Hathaway discussing the cash hoard Buffett will be sitting on by year end and the potential for a dividend.
Berkshire’s operating profits are on track to hit a record $12 billion to $13 billion after taxes in 2011, up from an estimated $11 billion in 2010, buoyed by Burlington and many of the company’s manufacturing and industrial units, whose earnings fell sharply during the downturn.
Combine that with the likely repayment of some lucrative investments in Goldman Sachs (GS), General Electric (GE) and other companies that Buffett made during the financial crisis, and Berkshire’s insurance units could be holding $20 billion more by year end than the $30 billion they had on Sept. 30, 2010.
The flood of cash could prompt Berkshire to finally start paying a cash dividend in the next 12 to 18 months, particularly if the 80-year-old Buffett is unable to find what he calls an “elephant,” or a large acquisition.
Read the full article here.
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