Berkshire's Best Day in 2-1/2 Years Puts Stock at Buyback's Upper Limit
Shares of Warren Buffett's Berkshire Hathaway soared today, putting them right around the upper limit of the company's surprise stock buyback authorization announced this morning.
The Class A stock closed 8.1 percent higher, its best one-day gain since soaring 15.9% from Berkshire's credit-crisis closing low of $73,195 on March 10, 2009.
Today's gain puts Berkshire A shares at $108,449.
Perhaps not coincidentally, that's right around our best estimate of a potential buyback's upper price barrier.
Today's news releasesays management (read Buffett) is authorized, but not required, to buy back shares "at prices no higher than a 10% premium over the then-current book value of the shares."
Since only the company knows its book value on a day-to-day basis, our most recent hard number is from Berkshire's latest quarterly filing.
It puts book value at $98,716 per Class A share as of June 30. Ten percent above that is $108,558 .. just $109 above today's close.
Has Buffett set both a floor and a ceiling for Berkshire's stock?
Current Berkshire stock prices:
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