The Oracle's Annual Letter To Shareholders

Warren Buffett's annual letter to shareholders was released early yesterday morning. The annual letters are Buffett's way of communicating with his shareholders. Buffett has been writing these letters to shareholders for over fifty years. The letters dating back to 1977 can be found here at Berkshire Hathaway. If you have never read any of them, I highly recommend doing so. Buffett speaks in a simple mans English and not the typical wall street analytic jargon that one needs to decipher. Buffett used the past year or so to put more dollars to work, and that he did. Berkshire invested in Goldman Sachs preferred shares and General Electric preferred shares both netting a 10% yield. He recently consummated the deal to buy the rest of Burlington Northern Santa Fe shares that he didn't own. He further increased his stakes in the largest retailer WalMart ($WMT), the number two waste company Republic Waste ($RSG) along with his good buddy Bill Gates who happens to be the largest shareholder of Republic Waste. Buffett has been a busy man over the last year and a half and certainly in the media more.

Here are some recent articles on the Oracle of Omaha...

Berkshire reports higher Sanofi, Tesco stakes

Excerpts from Warren Buffett's annual letter

Berkshire Hathaway fine-tunes its holdings

Whitney Tilson: Berkshire Hathaway Is Bargain Of 80 Cents On A Dollar

Author currently long $BRKB and $RSG

Your Garbage Can Pay You Dividends

First Posted On Our Sister Site @ HighYieldingDividends

Who said their wasn’t money in trash. Well these three companies pass their profits to share holders. Listed below are three companies that are in the waste management industry. Two large caps and one small cap. All three pay a nice dividend. One well known tycoon has a significant stake in Republic Services.

Waste Management, Inc. - was founded in 1894 and is based in Houston, Texas. Waste Management (WM) is the leading provider of comprehensive waste management and environmental services in North America. As of December 31, 2008, the company served nearly 20 million municipal, commercial, industrial and residential customers through a network of 367 collection operations, 355 transfer stations, 273 active landfill disposal sites, 16 waste-to-energy plants, 104 recycling plants, and 111 beneficial-use landfill gas projects.

Republic Services, Inc. - was founded in 1996 and is headquartered in Phoenix, Arizona. Republic Services (RSG) is a leading provider of solid waste collection, transfer, recycling and disposal services. We operate 400 collection companies in 40 states and Puerto Rico and provide top quality services to commercial, industrial, municipal and residential customers. Republic serves millions of residential customers under contracts with more than 3,000 municipalities for waste collection and residential services.

American Ecology Corporation - was founded in 1952 and is headquartered in Boise, Idaho. American Ecology (ECOL) is one of the nation’s oldest providers of radioactive and hazardous waste services. The company accepts hazardous and low-level radioactive waste from commercial and government entities, such as refineries and chemical production facilities, manufacturers, electric utilities, steel mills, and medical and academic institutions. American owns one commercial nuclear waste disposal site and three hazardous waste sites in the United States.

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*William (Bill) H. Gates is chairman of Microsoft Corporation, the worldwide leader in software, services and solutions that help people and businesses realize their full potential. Mr. Gates owns 15% of the common shares through his investment vehicle Cascade Investment LLC and The Gates Foundation.

*Mr. Heil is a land developer and private investor, and has owned and operated one of the largest solid waste landfills in the mid western United States. Mr. Heil has more than 40 years experience in the construction and waste service industries and has, since 2002, served as President of E.F. Heil, LLC, operator of a landfill in Plainfield, Illinois. Mr. Heil is a director of American Ecology and the largest individual share holder in the company owning close to 6%of the common stock.

Gates Finds Value For His Foundation And His Personal Portfolio

The former Richest man in the world Bill Gates is now spending much of his time helping his wife Melinda Gates run the worlds largest foundation "The Bill & Melinda Gates Foundation". Along with running the foundation Bill also has his own Investment company known as Cascade Investments, which is a diversified investment company that has holdings in many different fields. Its interesting to note that Gates Holdings in the "Foundation" and "Cascade" are not what you would think of the software king. Most of his holdings are broad based including pharmaceutical, energy, transportation, consumer beverage, building materials and insurance companies. In his personal account which is Cascade Investments he holds an eclectic group, but much more concentrated than the Foundations portfolio. The three largest holdings between the two portfolios are Berkshire Hathaway(BRKA,BRKB), Canadian National Railway(CNI), and Republic Services(RSG). He also has a sizable stakes in Fomento Economico(FMX) which is the Latin American Coke(KO) and beverage company, and Gruppo Televisa(TV) which is a Latin American media company. He also just recently upped his position in Otter Tail(OTTR) an electric company with a diverse portfolio within itself.

Billionaires Buffett & Gates Up Stakes In RailRoad & Waste

Again the Oracle of Omaha, Warren Buffet bought Burlington Northern Santa Fe Corp. (BNI) bringing his total share count to over 74 million and giving him the largest stake with 22% of company . Prices ranged between $61.65-$$63.43.While fellow billionaire buddy Bill Gate's Cascade Investments ups its stake in Republic Services (RSG) bringing the total to over 39 million shares and 10 1/2% ownership. Prices ranged between $22.97-$25.43. Cascade Investments which is gate's Investment arm also has large stake in Canadian National Railway Company (CNI).

Author is currently long BNI

Bill Gates The Value Investor

It looks like Bill Gates  co-founder of Microsoft is also a value player. Gates controls a holding company named Cascade Investments which has been around for 14 years.  Currently Cascade Investments holds a diverse basket of 18 stocks. These businesses range from a railroad to a soft drink bottling company. It certainly looks like Cascade Investments is modeled in some ways like Warren Buffetts Berkshire Hathaway(BRKA,BRKB) excluding the insurance companies. In a recent 13F filing Gates added to his position in Republic Services(RSG) upping his stake to nearly 20% of the company. Republic Services is one of the United States leading waste providers. The largest holding in the portfolio is Canadian National Railway(CNI) which Gates owns about 7% of the common shares. He also upped his stake in Fomento Economico Mexicano,SAB de SV(FMX) which produces, markets, and distributes Coca-Cola trademark beverages as well as SOL Beer. He now holds 5.9% of the common shares of Fomento. His newest holdings which are rather small purchases include AutoNation(AN), Patriot Coal(PCX) and Strategic Hotels &Resorts(BEE).  Interesting to note is that Buffett and Gates own some significant stakes in the rails. It also looks like Gates took a page out of Peter Lynch's One Up On Wall Street and invested in a boring and disgusting business that being Republic Services. Whats next for the King of Software?

Relevent Articles

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Gates Finds Value For His Foundation And His Personal Portfolio

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