Stansberry Research analysts have come to a startling conclusion about the future of super conglomerate holding company Berkshire Hathaway and its chairman and CEO, Warren Buffett.
Buffett has made a series of questionable investments since 2003 Stansberry Research analysts have found, turning away from the tried and true business model that brought Berkshire Hathaway a multi-billion dollar conglomerate. Rather than placing the billions of investment capital generated through insurance subsidies in shares of high-quality, publicly-traded companies — and purchasing whole companies — that hold up well over time, Buffett began acquiring highly-regulated public utilities. Those utilities — particularly MidAmerican Energy and Burlington Northern Santa Fe Railroad — take an enormous amount of capital with little to no return to justify that investment.
As such, Berkshire Hathaway has drastically reduced its ability to compound wealth and has gone from routinely beating the S&P 500 to doing so only half the time. Stansberry Research analysts believe in another five years it will be nearly impossible for the company to do at all.
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