Berkshire more inclined to repurchase stock than pay
dividends: Buffett
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[February 26, 2018]
NEW YORK (Reuters) - Warren
Buffett, chairman and CEO of Berkshire Hathaway Inc <BRKa.N>, said his
conglomerate, which is sitting on $116 billion of cash, is "more
inclined" to repurchase stock than pay dividends as a means to use
excess cash.
Speaking on CNBC television on Monday, Buffett said the corporate income
tax rate cut signed into law by U.S. President Donald Trump in December
is a "huge tailwind" for U.S. companies and that it is "really good for
Berkshire."
Berkshire attributed roughly $29.11 billion of its net income last year
to the reduction of the corporate tax rate to 21 percent from 35
percent. Many U.S. companies' reported results have been skewed by the
law's impact.
In his annual letter to Berkshire shareholders on Saturday, Buffett
lamented his inability to find big companies to buy and said his goal is
to make "one or more huge acquisitions" of non-insurance businesses to
bolster results at Berkshire.
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Berkshire Hathaway CEO Warren Buffett plays bridge during the
Berkshire annual meeting weekend in Omaha, Nebraska May 3, 2015.
REUTERS/Rick Wilking
Buffett said finding things to buy at a "sensible purchase price" has become a
challenge and is a major reason Berkshire is awash with $116 billion of
low-yielding cash and government bonds - whose average maturity was 88 days as
of year-end 2017.
"I am fairly confident we will find ways to deploy" Berkshire's excess cash,
Buffett said on CNBC. "The best chance to deploy money is when things are going
down."
(Reporting by Jennifer Ablan and Jonathan Stempel; Editing by Peter Graff and
Chizu Nomiyama)
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