Warren Buffett’s early correspondence to Berkshire Hathaway shareholders contains many nuggets of information that investors can learn from. And it’s not just value investors that can learn from Buffett’s early correspondence.
Indeed, Buffett’s letters to Berkshire shareholders in the early 1970s don’t cover equity holdings. At the time, Berkshire was still, predominantly a textile company and most of Buffett’s time was taken up trying to return the textile business to growth.
But one thing that stands out from Berkshire’s early letters was how Buffett measured the business’ success from year to year. In particular, rather than starting the letter’s “Berkshire’s EPS grew X%”, Buffett uses stockholders equity grow as a yardstick.
“To the Stockholders of Berkshire Hathaway Inc.:
It is a pleasure...
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