KPO

Generally agree, but down 30% from highs and the lowest valuation by several metrics in a decade suggests it’s starting to get getting overplayed. These assets will be in place and productive long after the tariff war of 2025. That said, I agree there’s likely more downside, so I’m wading slowly into CNI.

More CNI

Increased RTO by 50%, increased FRPH by 25%, starter in CNI (first rail purchase since late 2009).

Starter in MGM

BGS

Increased RTO exposure by 40%. If present management can’t integrate what they’ve purchased, I suspect PE would happily do it for them. This is an attractive cash flowing industry in similar form to environmental & waste services. At some point the multiple will reflect this fact as it already has with ROL.

I actually love the exact idea if they could pull it off at a somewhat reasonable valuation. Berkshire should pursue dominant private companies with sticky products like Epic with a willingness to use equity for the right targets (I.e. let the owners/founders diversify in a tax advantaged way). Back when they did the Wrigley deal I was hoping Mars would find a home with Berkshire. Mars has grown too large since then with all the animal health/pet-related acquisitions.

That’s a very left field idea. Great company. I’m not sure if Berkshire would pay up for it, but it would be a great way for Judy to diversify. Whether it’s Epic, or anyone else, an equity driven acquisition would certainly be a bold statement for what Buffett thinks of the present valuation. I know he’s very much against the concept, but if you subsequently repurchase the shares I don’t see much harm in it.

Thanks for sharing. We watched the documentary on Amazon Prime this weekend. Very interesting.

SHO Preferred

This is definitely a message to the Treasury, the Fed, and any other leaders that can effect the country’s balance sheet and status of the dollar as the world’s reserve currency. I suspect history will remember this section more than any others from this otherwise uneventful letter. I hope it’s not his last, but if it is, he’s been a phenomenal teacher to countless people around the world.

TOL

A quarter of my BABA on the hysteria recently. Didn’t expect 95% in less than 8 months, so hard to complain.

TOL has repurchased ~50% in the last decade while maintaining a strong balance sheet and not starving the business.

Thanks!

Lazy question as I’m just starting to look at this company: What investments make up the ~$17.4B of long-term investments on their balance sheet?

Exactly why I’ve been buying in recent days.

IAC & CI starters; Doubled long held positions in UPS & CMCSA

LMT starter

Insurance. Railroad. Energy. But is he really? Patience seemed to work for Buffett and Munger. Study when Munger bought Wells Fargo and let me know if you disagree. There’s nothing wrong with waiting for a fat pitch or two, even if you have to wait several years. I think many of us (me included) have forgotten about the importance of patience in investing.

In all fairness I think most of us can agree the greater fool investing style doesn’t work during some market periods, but we happen to be in one of those periods when a popularity contest rules the day. While it may seem unsustainable long term, it may sustain longer than one might expect. There’s nothing wrong with sitting on the sidelines or investing in bond proxies when the world seems upside down. Live long enough and you’ll see everything.

I did. Doubled my position late this summer around $7.50. I hold it in a taxable account since it’s non-income producing, so I did a tax loss sale of some of the initial position, but I’ve been watching it closely of late. Given the balance sheet and benefits of scale that have become increasingly evident in the financials the last year or so, I see this as a likely takeout candidate. I also liked that Walmart and a few others exited the telehealth business last year, so competitive intensity should be lower. Even if they aren’t taken out there’s a lot of optionality to the business in similar form to Netflix when they were mailing DVDs vs streaming.

While the copper businesses have had some safety issues in the past, I don’t see any financial governance issues that concern me. My one critique would be around repurchases. Given the SOTP value is more than 50% over the current quote and they have very limited leverage, I’d like to see repurchases here. They’ve really only done small repurchases in the past, but they also haven’t issued shares either.

I’m in the cash heavy camp at the moment, however I think there are many low to medium conviction value opportunities currently available, so I’ll throw a few out there: - BGS - acquisition candidate with some recent insider buys - GMBXF - SOTP/inflation hedge/NA trade exposure w/ railroad concession that’s much larger and more valuable than CP’s KCS-purchased Mexican concession - OLN - share repurchase cannibal the past 5 years - STNE - cheap on virtually any valuation metric, hedge on dollar strength reversing - HOG - share repurchase cannibal the past 10 years, revenue in secular decline, but strong embedded base, valuable niche brand that could make it an acquisition target

HOG