14 February 2013: Berkshire and 3G buy Heinz
Warren Buffett's Berkshire Hathaway teamed up with Brazilian investment firm 3G Capital to buy H.J. Heinz for about $23 billion, a Valentine's Day deal for the ketchup maker. Two years later Heinz merged with Kraft. The combined company eventually took a giant write-down as its brands lost ground to cheaper and trendier rivals. Even Buffett admitted he had overpaid for Kraft. Sauce, it seems, is not a moat forever.
The lesson: Famous brands are not immune to change; even the best investors can overpay for yesterday's favorites.
What it meant for investors
$1,000 in Berkshire Hathaway at the start of 2015 → $3,333 today, vs $3,301 in the S&P 500.
We start the clock at the start of 2015, the first year in our price data after the event. That is 3.3 times the money, and $32.36 more than a plain index fund made over the same years.
What Berkshire Hathaway teaches: Being willing to look foolish during a mania, and keeping cash for the moment others are forced to sell, is a durable source of returns.
| Bought in | Price then | Worth today | S&P 500 would be |
|---|---|---|---|
| 2015 | $150 | $3,333 | $3,301 |
| 2018 | $198 | $2,525 | $2,519 |
| 2020 | $226 | $2,212 | $2,092 |
green = beat the S&P 500 · red = lost money
What if you bought Berkshire Hathaway? Every starting year and the full story →
More Berkshire Hathaway history
- 28 February 2009: Buffett's letter: beware of geeks bearing formulas
- 10 May 1965: Warren Buffett takes control of Berkshire Hathaway
- 30 August 1930: Warren Buffett is born in Omaha
Could you have called it at the time? The wheel picks the year, you pick the position, ten seconds a pick.
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