Dec 5 Warren Buffett's Berkshire Hathaway Inc
could get a $29 billion boost to its book value if
President-elect Donald Trump is able to slash the U.S. corporate
tax rate to 15 percent from 35 percent, Barclays Capital wrote
Trump's proposed reduction could help Berkshire lower its
net deferred tax liability to $21.6 billion from $50.5 billion,
excluding sums associated with its regulated utility units,
Barclays analyst Jay Gelb said.
Shareholders could reap the benefit, particularly because
Buffett considers book value, a measure of assets minus
liabilities, a key measure of Berkshire's growth. Gelb said a
$29 billion increase would equal about 11 percent.
"We would view this magnitude of increase as favorable for
Berkshire shares since it is generally valued based on
price-to-book value," Gelb wrote.
Berkshire's Class A stock price has risen 8.4 percent since
the Nov. 8 election, touching an intraday record $240,500 on
The gain has been fueled by optimism that Trump's policies
could be friendly toward business, and the rising value of
holdings in bank stocks such as Wells Fargo & Co.
Buffett endorsed Trump's Democratic rival Hillary Clinton
for president, though in his more than half-century running
Berkshire has long tried to limit the Omaha, Nebraska-based
conglomerate's tax bill.
He said in April that the odds were "extremely high" that
Berkshire would buy back "a lot" of stock if the price fell
below 1.2 times book value. Buffett also said the company was
worth much more.
(Reporting by Jonathan Stempel in New York; Editing by Jonathan