Berkshire Seen Failing Buffett 5-Year Test for First Time

Warren Buffett probably missed his target for the first time in 44 years.

Berkshire Hathaway Inc., his $292 billion company, is poised to report that it failed to increase net worth more rapidly than the Standard & Poor’s 500 Index during the past five years, according to analyst estimates. It would be the first time the billionaire investor fell short of the goal since he took over the Omaha, Nebraska-based company in 1965.

Buffett, 83, highlights the comparison as a way for shareholders to evaluate his performance against a low-cost fund that tracks the index. The S&P 500 returned 128 percent including dividends since the end of 2008, fueled by the Federal Reserve’s stimulus efforts and higher corporate profits. Berkshire’s book value per Class A share, Buffett’s yardstick, rose 80 percent to $126,766 starting at the same point until Sept. 30, the latest data available.

“He’s been awfully honest” by keeping the goal the same, said Tom Russo, a partner at Berkshire investor Gardner Russo & Gardner. “He didn’t pick it because it was an easy benchmark.”