KPO

I lightened up a few things recently that were in IRA accounts and had decent run-ups. I was up ~40% on Aecon in a relatively short amount of time, so I was okay lightening up even if it keeps going higher. I still have a small position.

Exited Grupo Mexico with a 90% gain in ~10 months. I’m sure it will truck higher, but I’m satisfied given it was in my Roth. Also sold 2/3 of my remaining Aecon.

I’m betting it’s an exchange of some sort as I’ve mentioned a few times in recent years. If it plays out this way, I love it. Tax efficient transaction at a good valuation for an asset with lumpy returns. If they involve some or all of the preferred this is a win win as it allows OXY to start up the buyback engine, which will further bump what remains of Berkshire’s OXY equity. Seems brilliant.

An equity swap for 90% of the common position in OXY would be a tax efficient way to spin this, but unfortunately it’s looking more like a garage sale to reduce debt like other poorly run companies (e.g. LUMN). https://www.ft.com/content/800fc153-1f61-4570-a5e0-dc784bf99b63

CMCSA

IAC

A bit more ABNB

I think it makes things more complicated as a practical matter. It’s very hard to optimize usage if you constantly have to offload trains at switching yards with few places to do it, but I suppose you could build more switching locations like the large east to west switching yards in Chicago and KC.

Rail is single threaded more times than not, unlike the government sponsored multi-lane interstate highway system, so this won’t work. This is coming from a guy that lives near single threaded railroad tracks that require us to take the long way 1 out of 5 times due to trains parked near our crossing.

Finally dipped a toe into CNC. This sector is impaired, but this is starting to feel like BA at $118 a few years ago when the analysts capitulated.

Nothing earth shattering here for this audience, but worth a read. Obviously Fairfax is mentioned as one of the firms emulating Berkshire. https://www.barrons.com/articles/berkshire-hathaway-warren-buffett-companies-howard-hughes-loews-fairfax-financial-greenlight-capital-markel-white-mountains-e631c648

I hope not. Under $450 maybe, but it’s overvalued even today. I hold it in a taxable account that has 25+ years of gains, so I’m not selling, but I hope they continue to be very price sensitive on the buybacks.

My view is that it’s a troubled business, however as with PSX and PG they could hive off units in tax-free transactions. The rub is they don’t presently have a logical place to house packaged food acquisitions. It does introduce a valid strategic question of whether it would make sense to formally establish business sector leaders who are charged with growing the business through sensible bolt-on acquisitions. Maybe that’s how they establish this capability in the packaged foods space (if it’s even a business they want to participate in long term).

https://ir.kraftheinzcompany.com/news/the-kraft-heinz-company-announces-ongoing-evaluation-of-strategic-transactions-to-unlock-shareholder-value/5fa424cf-9c84-40ce-a10b-0ce821ec3e27 Would be good to see Berkshire figure out a way to exit this investment that hasn’t worked out.

One company that I’ve always thought would be interesting for Berkshire to own either partially or in total is ITW. They have a fairly consistent record of free cash flow growth, have retired about 35% of their shares in the last 10 years or so, and have a conglomerate like structure Buffett would appreciate. The only issue is it seems pretty much fully valued presently.

Reminds me of this old classic article: https://jasonzweig.com/a-golden-oldie-the-best-investor-youve-never-heard-of/#:~:text=By popular demand%2C I'm,investors%2C including his friend and

I’d welcome that, but I think we all remember the abject failure that was Haven healthcare. It briefly tanked the sector. It’s a tough industry to crack and the reality is that UNH is a conglomerate with businesses that do and don’t add value to society, but on balance there is value here at a share price sub-$410.. A breakup is one of many possibilities. I wouldn’t be surprised to see an activist surface in the next few quarters.

UNH & CI

Cheap getting cheaper is exactly what’s happened as I started buying at $409 and have an average cost basis now of $390. It’s at the low end of its historical valuation range, but their $20-25B of annual FCF is a big target for politicians, so it’s not without risk. I look at whether it’s decent value here if FCF is sub $20B, which it is in my view.

More UNH & CI

This is a much better answer in my view. I’d hope they’ve moved past the footwear industry after their experience with Dexter and HH Brown.

I don’t know the answer to the question, but there’s enough history here to listen to a prior meeting every first Saturday in May for the next 31 years. This is something I may actually do as the first one I listed to, first question in fact, was prescient when you consider what happened four years later with LTCM. https://buffett.cnbc.com/annual-meetings/

Another slug of UNH

Starter in UNH

I don’t view that as a unique insight. Look at it on several measures compared to KO and then ask yourself if this doesn’t have activist magnet written all over it. Meanwhile I get a growing yield of just over 4% to wait, and have the option of writing calls on run ups, etc. Over two decades I’ve found boring low/no revenue growth investments like this provide decent risk adjusted returns after 25-40% declines off there highs. It’s not for everyone.