E Old Men, Value Companies

A young man is a theory, an old man is a fact. − E. W. Howe 

You think Joe Biden at 78 is too old to lead America? Well, think again! There has been a whole lot of debating going on recently about the efficacy of leaders who are past their prime, and whether their management skills still have some steam left. I thought it would be a good idea to dig into corporate America and check out the health of companies managed by CEOs in their golden years. Here's a list of four CEOs with a combined age of 326 years – that’s 83.5 years per - and they're managing very successful American companies.

1. BERKSHIRE HATHAWAY (BRK)

CEO: Warren Buffett
Age: 90 years
Market Price:  $341,339, as of November 20, 2020
Market Cap: $533 billion

Neither The Oracle of Omaha nor BRK, a holding company, need any introduction. BRK recently bought back $9 billion of stock in Q3 2020, but COVID-19 stung its commercial insurance and reinsurance underwriting business.

BRK’s balance sheet is extremely robust: $35.6 billion additional capital, $409 billion retained earnings, $400 million in short- and long-term investments, and cash and equivalents worth $27 billion are the result of efficient and proactive management. The company does not pay a dividend.

In July 2020, BRK picked up Dominion Energy’s natural gas transmission and storage business for $10 billion. It also purchased a 5% stake each in five Japanese trading companies — Itochu (ITOCF), Marubeni (MARUF), Mitsubishi (MSBHF), Mitsui (MITSY), and Sumitomo (SSUMF).

A 1% fluctuation in the stock translates to a $3,350 movement in the stock price, and therefore it is not a stock for the faint-hearted.

2. UNIVERSAL HEALTH SERVICES (UHS)

CEO: Alan B. Miller
Age: 83 years
Market Price:  $131, as of November 20, 2020
Market Cap: $11.1 billion

Alan founded UHS, a hospital and healthcare services provider, in 1986. He has managed it efficiently, and just recently UHS was conferred the Healthcare Supply Chain Achievement Award by the ECRI. If Obamacare is not repealed by the Supreme Court, and/or it is expanded after January 20, 2020, healthcare and hospital provider stocks are expected to witness heady days so long COVID-19 claims and reduction in government spending do not hurt their profitability.

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Disclosure: I have no position in the stocks discussed, and neither do I plan to buy/sell it in the next 72 hours. I researched and wrote this article. I am not being compensated for it (other ...

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William K. 11 months ago Member's comment

Four examples of fairly old men running very successful companies. Certainly proof that it can be done by some people. But how old were they when the companies first took off and became quite profitable? Like many other talents and skills, their skills become better with practice. Sufficient practice does lead to improved skills, that holds in most fields, except competitive drinking, an area not on the path to success and prosperity. How nany folks aged 70 and over start a company that becomes a success? There is a big diffeence as I see it.