KPO

Energy around loving a sell-side analyst on a value forum is unexpected. Of the 7 analysts that cover Berkshire I haven’t seen much in the way of unique insights, but good to hear that you like him.

Good list. Closing out the swap contracts would be another. At this stage I’d prefer straight buybacks or tenders like they did late last year.

GMBXF

Not sure if this applies to Greg, but it seems like the Value Line and Morningstar analysts usually have unusually broad coverage, so I pretty much ignore anything they have to say in terms of recommendations. Both are fine for historical data though.

GMBXF

I’m not all that precise on the position sizing, but they’ve been roughly equal to date.

Yeah, this one is kind of interesting as there’s probably little risk that it doesn’t close, but it’s not clear to me what I’d end up with on the CVR after taxes (despite being in tax advantaged accounts).

Thanks! I’ll check this out. Sounds like you’re in the same boat as me in not spending much time on these, but still enjoying the outcome.

Great topic. I’ve been doing this off and on for years with 5-10% of my portfolio. I always target cash deals and I hold the positions in my Roth or traditional IRA to avoid creating a tax event. On balance I’ve actually been surprised how well it’s worked out, but I don’t feel like I’ve developed a good repeatable process for sourcing ideas. It’s just sort of been randomly stumbling upon ideas from various sources. I’m actually in a spot where I need some new ideas as CNR, TEN & VG have mostly run their course. I’ve got a bit of ATVI, but if others have ideas I’d be interested.

What ever happened to this guy? I always enjoyed his stream of consciousness posts.

Thanks for sharing. This kind of made me laugh, although I suppose me knowledge of Australia isn’t any better: ”Buffett’s main renewables play so far has been through MidAmerican Energy, based in Dec Moines, Idaho”

They also act as a hedge of sorts if you have a lot of O&G exposure like I do. Do you have a preferred tire company to invest in? I own a little GT, but don’t love the balance sheet.

MTN under $215

Yeah, my thinking here is that he either rides it as a hedge for a while then peels off a division (most likely OxyChem) in an exchange or he sells once he’s ridden it up enough and potentially oil inflation peaks. That said, my own personal bias is that ESG and things like zero emission mandates by 2035 keep oil well over extraction cost. Rhetorical question: do tires not cause a form of emissions, particularly on much heavier EVs?

NTR & MOS are decent options here, but not home runs. I’ve bought a small amount of each as inflation hedges a while back, but more recently a lot of farmers are evidently reducing fertilizer this year rather than taking the unusually high prices the market offers. As a farmer this is a short term fix, which could lead to some pretty terrible humanitarian issues in the less affluent corners of the world in 6-12 months. These are buys if the war drags on another 12+ months, and will generate nice cash flow short term if it doesn’t as the supply constraints will continue for a period of time once the war is resolved.

At best timing markets is a difficult task and at worst it’s foolish for those that have a low stock allocation. I’m actually not buying here, but I understand why folks would start averaging into this and several other quality names. Who am I to question an investing legend, but I never loved the Apple position sizing and I think it carried Berkshire $30-40 per B share above fair value and is now pulling it down. Both are great companies, but that doesn’t mean they’re priceless. I last bought several times between $170 & $180 during Covid (out of pure luck), so would like to see the late 2019 prices of $210-220 before buying again….and this is partially because there are more interesting opportunities currently.

Not exactly contrarian, but there are some interesting merger arb opportunities like TEN, and of course ATVI, with 30-35% annualized profit potential. Even Y is 2% off the deal price and should close in 4 months or so. Not exciting, but should perform ok on a relative basis with less risk of principal. I also have to wonder if BA @ $115 and WBD sub-$14 will look like bargains in retrospect when we look back on them 4-5 years from now.

Is this climate change or over population in the cities that use Mead and Powell as a water source? Probably some of both, but it’s definitely bad at Mead when bodies start getting exposed from the mob sinking them in the lake back in the day.

A bit more AIV @ $6.20; Hopefully it will go sub $5.50 again so I can make more serious purchases.

Dope and quality can be two different things. Your Ford choice is probably true, but as someone that has owned two Toyota FJ cruisers, which were made 100% in Japan, I’ve only been to the dealership one time in 15 years……and this was for a door seal issue. That’s quality. The early EVs have had a lot more quality issues than the popular media let’s on….and they rip through tires at a much higher volume due to their 25-35% greater weight relative to similar ICE vehicles. Buy GT I suppose, particularly if you want a hedge for significant oil gains recently! I did.

Not sure how the margins will look once warranty related repair/inevitable GM recall costs are baked in. And is anyone else worried about the legal liability of a 9,000 lb projectile that goes 0-60 in 3 seconds? I just think mass markets auto manufacturing is a tough business to generate outsized long-term free cash flow.

I agree, this seems like an interesting exercise. Sorry I missed your initial post. Better late than never, I guess. Anyway, I like most of your list. I’d add MKL, which I was able to add during 2020 after foolishly selling after it went up about 125% several years ago only to watch it go up further. I’d also add IFF, BA, KO, PEP, UNP & TPL (which I foolishly DIDN’T buy, but seriously considered in March of 2020 at under $450). Live and learn. Investing is the ultimate exercise in continuous improvement. I’d be interested in the thoughts of others on the board.

BA

If you’re interested in this sort of thing you might consider TEN which frequently sports a 25-28% rate of return on the cash buyout price. Of course ATVI is another at a 22% potential return, but it’s close is further out and seems to have more political pushback, which is possibly just noise. I’m in on both because I have zero exposure to these businesses otherwise and am fine to own both if the deals don’t materialize and they drop 10-15%. Good luck.

He seemed familiar with Bayer when discussing the Monsanto merger arb deal, so that’s one to put on the short list.