Impressed by Warren Buffett’s statements at the annual meeting and after reviewing the past few years of shareholder letters, on December 31, 2001 Jane decided to purchase 10 Class A shares for $75,600 each, a total investment of $756,000.
Berkshire’s book value per Class A share was $37,920 on December 31, 2001, so Jane paid very close to two times book value for the stock.
Until relatively recently, Warren Buffett believed that changes in Berkshire’s book value represented a reasonable proxy for changes in Berkshire’s intrinsic value.
