Valuehalla

50centdollars, great post, THX! Now BRK is trading P/E 19 to 20, but the potential future P/E is a max of 8 to 10 (if 100 to 150 B acquisition can be realized) Cashflowratios more attractiv: BRK Marketcap is 419 B, Cashflow in 2017 app 35 B. 100 B on hands for doubleling profit and cashflow. Maybe we are on the eve, Warren will pull the historical 150 B trigger. Berkshire will be the Phoenix of Wall Street! Our old eagle will fly proudly round the highest summit cross. Latest on Warrens 90th anniversary, Mr Market shall deliver the BIG T (1 Trillion) as our all gift.

The Grand Deja Vu ? Is the 9th June 2017 the overture for a grand deja vu of 1st Feb 2000? The 1st Feb 2000 was the day when BRK A hits a low of US$ 44.000. (The old B share was at that day US$ 1466). The same day the tech stocks hit record highs and than they start to burst in the mighty bang. I remember a quote of someone, he said or wrote: "in the same second when the prices of the techs got red in my computer, BRK price got green..." 1st Feb 2000 our beloved Berkshire founds track immediatly, one day later the rocket started and in the same way the techstocks melted down, we saw a mighty Berkshire lift of. One year later, on 1st Feb 2001, BRK reached US$ 70.300. The Techs were defeated. On 9th June 2017 we saw the same direction, also on one singel day: Belaughed Techs like FANG etc. tanked and beloved BRK started to rise. Will it go on ? 17 years later, will Mr. Market double down? We are fully ammunitioned with 100B, let the elephants come to us. If Warren will hunt an elephant, with a profit of 20 B per year, BRK should minimum double again.

The Grand Deja Vu ? Is the 9th June 2017 the overture for a grand deja vu of 1st Feb 2000? The 1st Feb 2000 was the day when BRK A hits a low of US$ 44.000. (The old B share was at that day US$ 1466). The same day the tech stocks hit record highs and than they start to burst in the mighty bang. I remember a quote of someone, he said or wrote: "in the same second when the prices of the techs got red in his computer BRK price got green..." Our beloved Berkshire founds track immediatly, the rocket started and in the same way the techstocks melted down, we saw a mighty Berkshire lift of. One year later, on 1st Feb 2001, BRK reached US$ 70.300. The Techs were defeated. On 9th June we saw the same direction on one singel day: Belaughed Techs FANG etc tanked and beloved BRK started to rise. Will it go on ? We are fully ammutioned with 100B, let the elepphants come to us. If there is an elephant, with a profit 20 B per year, BRK should minimum double again.

It miss up some postings from me... something was canceled ?????

Thx a lot !

John, could you pls add your source of the cashflow figures?

B share on 31.12.2005 = 59,08 $ B share on 31..12.2016 = 162,98 $ 11 years internal rate = 9,66 % p.a. ...so confirmed by my side for John H. i agree: much upside potential 8) even to close the gap in grow-rates BV and MV

Hi John Hjorth, my figures above simple avg calculation: all single %-increases/decreases per year added and than divided by 11 Internal rate per B share: BV 10,16 % p.a. increase over 11 years: beginning 2006 till end 2016 beginning of 2006 BV = 39,57 $; end of 2016 114,74 $ = 11 years, eleventh root of 289,9 % = 10,16 % Correct?

According to Semperaugustus valuation and the BRK letter, the situation is like this: On 31.12.2016, per B share: BV (not KHC adjusted) 114,74 $ IV app 209,00 $ Marketprice 162,98 $ GAP app 28 % upside potential to reach IV 1.3.2017, my estimation, per B share: BV (not KHC adjusted) 118,80 $ (incl. est. InVestGains, BAC, APPL accumulation, minus defferred tax, plus operative IV app 216,00 $ Marketrpice 177,28 $ GAP app 22 % upside potential to reach IV

Hi Longhaul, in the last 11 years (incl. 2006 till end of 2016) BV increase in avg 10,46%. This includes marketcrash 2008/9. Marketvalue in same time moves up with an avg of 11,7%

According to Semperaugustus valuation and the BRK letter, the situation is like this: On 31.12.2016, per B share: BV (not KHC adjusted) 114,74 $ IV app 209,00 $ Marketprice 162,98 $ GAP app 28 % upside potential to reach IV 1.3.2017, my estimation, per B share: BV (not KHC adjusted) 118,80 $ (incl. est. InVestGains, BAC, APPL accumulation, minus defferred tax, plus operative IV app 216,00 $ Marketrpice 177,28 $ GAP app 22 % upside potential to reach IV

Total BV 31.12.2016 = 283,001 B Add to adjust KHC till 31.12.2016 13,1 B for fairvalue Add further till today (Jan+Feb+1March): Add for Investment gains app 12,4 B (Appel accumulation before 30th Jan, KHC, BAC warrents incl.) Add for Operative Jan+Feb app 3,0 B TOTAL BV today 311,501 B This means BV per B share on 1. March 2017 = app 126,30 $ (KHC adjusted) If its correct 177,28 $ (B closing price yesterday) is 40 % over (KHC adjusted) BV and seems still cheap to me. ATTENTION: deffered taxes are not embedded. Also unknown subjects from 1th Jan till today. Imo it is not possible to calculate an exact figure; so all is just approximatly...

Total BV 31.12.2016 = 283,001 B Add to adjust KHC till 31.12.2016 13,1 B for fairvalue Add further till today (Jan+Feb+1March): Add for Investment gains app 12,4 B (Appel accumulation before 30th Jan, KHC, BAC warrents incl.) Add for Operative Jan+Feb app 3,0 B TOTAL BV today 311,501 B This means BV per B share on 1. March 2017 = app 126,30 $ (KHC adjusted) If its correct 177,28 $ (B closing price yesterday) is 40 % over (KHC adjusted) BV and seems still cheap to me. ATTENTION: deffered taxes are not embedded. Also unknown subjects from 1th Jan till today. Imo it is not possible to calculate an exact figure; so all is just approximatly...

Total BV 31.12.2016 = 283,001 B Add to adjust KHC till 31.12.2016 13,1 B for fairvalue (see letter page 19) Add further till today (Jan+Feb+1March): Add for Investment gains app 8,14 B (incl. Appel accumulation before 30th Jan) Add for adjustment KHC + BAC 4,25 B Add for Operative Jan+Feb app 3,0 B TOTAL BV today app 311,5 B = +10 % since 31.12.2016 This means BV per B share on 1. March 2017 = app 126,30 $ (KHC adjusted) 177,28 $ (B closing price yesterday) is 40 % over (KHC adjusted) BV and this seems cheap to me. ATTENTION: deffered taxes are not embedded. Also unknown subjects from 1th Jan till today. Imo it is not possible to calculate an exact figure; so all is just approximatly...

So the consequences of the quote is: The more and longer BRK is "shifting in a major way to owning and operating large businesses" the adjustment on the BV has to increase. Since the possibility of a share-repurchase was announced, the adjustment is declared with BV + 20 %. Imo it shall already be more nowadays....

I am not ok with the system to multiply the earnings and than add the cash etc. The cash and also investments are needed to run the company. So these are not 2 independent subjects, which can be simple added. As I remind WEB by himself mentioned anyhow that minimum 20 (?) B cash is necessary: also it is reflected in the share buyback policy, there is a minimum amount of cash-holding quoted to do repurchases if MV is falling short of BV + 20 %.

Cigarbutt, let me add something concerning the subject "first half" and "second half": In "first half" we do not need an adjustment on BV to find a minimum line, but it is useful for the "second half": we need it, but its maybe a method like someone use a kitchenknife to amputate a blind gut, instead of a surgeon who does it in a delicate way. So the adjustment of 20 % is just a point of orientation. I think the more BRK grows in the way it has done in the second half, the 20 % shall be increased a little bit year by year. In consequence of this (BV+20%) see page 6 of the letter: "The authorization given me does not mean that we will “prop” our stock’s price at the 120% ratio. If that level is reached, we will instead attempt to blend a desire to make meaningful purchases at a value-creating price with a related goal of not over-influencing the market" BV+ 20 % is a soft initial-point, let me call it lighttower 8) Its light is the bargain-flashlight of BRK. The more closer MV comes to our lighttower, the more you can be sure to buy BRK is a good decision. But take as an advise from longtime holder, whatever the MV is...over the time : BRK was, BRK is and BRK will be a good investment.

Hi Cigarbutt, I agree with most what you write. Maybe there is a misunderstanding. The BV is for me just one lighttower among others on the investmentocean. If the MV is below the BV (or maybe below BV + adjusted 20% or maybe + adjusted from year to year plus a little % more) we just buy in this case 1$ for less than 1 $. If the MV is above BV + adjustment, my next or better additional lighttower is the IV, referring to future earningpower. Every investment decision is also always your personal subjective decision: You have to compare it with YOUR individual other opportunities. Also imo you shall understand and like the businessmodel and management, as a fundamental.

Munger-Disciple I agree and see letter page 6: "Charlie and I prefer to see Berkshire shares sell in a fairly narrow range around intrinsic value, ... " so same same :) consequence: The gap between MV and BV shall increase over time.

THX for that aspect longinvestor. Seems logical to me. So we can expect a better performance of MV than BV. The gap between MV and BV shall increase over time. Now the MV is app 1,4 above BV; end of 2007 is was 1,74 ... so much room to surge.

Total BV 31.12.2016 = 283,001 B Add to adjust KHC till 31.12.2016 13,1 B for fairvalue Add further till today (Jan+Feb): Add for Investment gains app 8 B (1,876 B for KHC incl.) Add for Operative Jan+Feb app 3 B TOTAL BV today 307,101 B This means BV per B share = 124,51 $ (KHC adjusted) Folks pls comment, correct ? If its correct 170,22 $ (B closing price Friday) is 36,7 % over (KHC adjusted) BV and seems very cheap to me. ATTENTION: A friend of mine made the remark, that in this calculation deffered taxes are not embedded. True! But its a simplification and time is always on the side of the profitable companies. So I think BV was even higher on this day, because of the accumulation of Apple shares before 31th Jan, which was not know at this time.

So if we adjust KHC by fair value, the BV per B-share is 120,01 $ for 31.12.2016 ?