DooDiligence Posted August 16, 2019 Posted August 16, 2019 Does anyone believe that WEB might be giving us every opportunity to buy for our own accounts before he goes on a tear?
thepupil Posted August 16, 2019 Posted August 16, 2019 I agree. Being long berkshire is kind of shorting the market, it’s the anti-valeant which was a glorious bull market vehicle. With respect to Ackman, the guys up 50% and in the process of rebuilding his reputation and track record. PSH trades for a 30% discount. In addition to genuinely thinking its undervalued, I imagine that buying Berkshire and simultaneously repurchasing PSH shares is a pretty sure fire way to crystallize and de risk gains and make money in the intermediate term. Buying Berkshire through PSH at a 30% discount is really attractive to me. He should go 100% BRK lol. To be clear I actually think berkshire is very undervalued, just saying that berkshires relative outperformance probably increases in a downmarket so I think people piling in now is potentially a bit of market timing
CorpRaider Posted August 16, 2019 Posted August 16, 2019 One advantage he didn't mention. WEB should compound in the teens and he doesn't charge 2 and 20....awwwwwkward.
Guest longinvestor Posted August 16, 2019 Posted August 16, 2019 Interesting times we live in. It was just two years ago that Buffett had the Hedge funds squirming with the embarrassing bet and now they are themselves piling in. What’s next? They go activist? Seek board seats? A la Icahn. Force buybacks? Break up the company?
gfp Posted August 19, 2019 Posted August 19, 2019 Berkshire looks about to borrow in Japanese Yen - https://www.sec.gov/Archives/edgar/data/1067983/000119312519223905/d783972d424b5.htm https://www.nasdaq.com/article/berkshire-hathaway-hires-banks-for-secregistered-yen-bonds-20190819-00018 https://asia.nikkei.com/Business/Markets/Buffett-s-Berkshire-to-issue-first-ever-yen-bonds A team! Investment decisions and all other capital allocation decisions are made for us and our subsidiaries by our senior management team which is led by Warren E. Buffett, in consultation with Charles T. Munger. Mr. Buffett is Chairman and Mr. Munger is Vice Chairman of Berkshire’s Board of Directors. And a new "conflict of interest" disclosure: We own more than 10% of the outstanding common stock of Bank of America Corporation, the parent company of Merrill Lynch International. Accordingly, this offering is being made in compliance with the requirements of Rule 5121 of the Financial Industry Regulatory Authority. Because the notes to be offered will be rated investment grade, pursuant to Rule 5121, the appointment of a qualified independent underwriter is not necessary.
DooDiligence Posted August 19, 2019 Posted August 19, 2019 Berkshire looks about to borrow in Japanese Yen - https://www.sec.gov/Archives/edgar/data/1067983/000119312519223905/d783972d424b5.htm https://www.nasdaq.com/article/berkshire-hathaway-hires-banks-for-secregistered-yen-bonds-20190819-00018 Fingers crossed that Omaha will receive interest payments for borrowing! That'd be a new twist on loan sharking. Next stop Europe?
cubsfan Posted August 22, 2019 Posted August 22, 2019 Update by Tilson on his intrinsic value calculation for Berkshire: https://assets.empirefinancialresearch.com/uploads/2019/08/Berkshire-Hathaway-analysis-Whitney-Tilson-8-21-19.pdf Today IV = $261/B share 12 months out = $284/B share At least with Berkshire, Whitney is generally spot on with the IV trend line, if not a little early.
Guest Posted August 22, 2019 Posted August 22, 2019 "the Prophet" haha I also liked this part: "Each month in the Empire Investment Report, Whitney Tilson and his team share their top investment recommendations, ideas, predictions, and warnings – in short, everything you need to know to beat the markets in the coming years." He should have been reading this over the past 10 years so he, too, could have beaten the market.
John Hjorth Posted August 22, 2019 Posted August 22, 2019 Perhaps a bit hard times for your posts, here, Mike, Thank you for sharing, and please let it go here. I always appreciate & enjoy reading your posts here on CoBF.
cubsfan Posted August 22, 2019 Posted August 22, 2019 Perhaps a bit hard times for your posts, here, Mike, Thank you for sharing, and please let it go here. I always appreciate & enjoy reading your posts here on CoBF. Thanks much John - doesn't bother me in the least. Lots of Tilson haters out there - even though Whitney's been spot on with Berkshire over the years. His analysis on BRK has been very good in the past - so I could care less if investors want to ignore it or make fun of it. My money agrees with his current view.
Guest longinvestor Posted August 22, 2019 Posted August 22, 2019 Perhaps a bit hard times for your posts, here, Mike, Thank you for sharing, and please let it go here. I always appreciate & enjoy reading your posts here on CoBF. Thanks much John - doesn't bother me in the least. Lots of Tilson haters out there - even though Whitney's been spot on with Berkshire over the years. His analysis on BRK has been very good in the past - so I could care less if investors want to ignore it or make fun of it. My money agrees with his current view. Mine too. If anything, his implied multiple of 12x is conservative and is based on the Berkshire of the 1990’s. The stellar earnings since 1999 deserves a higher multiple, more like Semper Augustus.
Swedish_Compounder Posted August 23, 2019 Posted August 23, 2019 One should also keep in mind that the tax rate has changed. If the pre tax multiple was 12x with the 35 % tax rate it should be 14,5x now I suppose.
Spekulatius Posted August 24, 2019 Posted August 24, 2019 The valuation is OK, but it doesn’t exactly take an advanced valuation method to determine that BRKB is undervalued. Even just looking at the chart gives you an idea. Traditionally, BRKB stock prices hasn’t always moved its the intrinsic value as ai see it, there wer periods, when the stock price stalled, while the IV increased. Typically, those periods lasted about 2 years. As I see it, they were from 2010-2012 ($70/share), 2014-2016 ($130) and 2018-???? ($200). simply put, since 2018 BRK has been building up “stored energy” in terms of earnings power, float, and cash (which will eventually be deployed) which at some point will lead to a rising stock price. On a side note, Wilson has a funny typo in his slide - “Fort Know”
John Hjorth Posted August 24, 2019 Posted August 24, 2019 ... Simply put, since 2018 BRK has been building up “stored energy” in terms of earnings power, float, and cash (which will eventually be deployed) which at some point will lead to a rising stock price. ... Simply put, this line of thinking by Spekulatius, has some merit, to me.
Viking Posted August 24, 2019 Posted August 24, 2019 ... Simply put, since 2018 BRK has been building up “stored energy” in terms of earnings power, float, and cash (which will eventually be deployed) which at some point will lead to a rising stock price. ... Simply put, this line of thinking by Spekulatius, has some merit, to me. Agreed. The Occidental preferred stock deal has just started to pay Berkshire $800 million per year. What i also like about Berkshire is it is likely that Buffett will be a buyer, and perhaps in volume, if shares fall much below $190. That should provide a nice floor for the stock price. I also like that they are not highly leveraged. They are the opposite, with $100 billion in cash which can be used should businesses go on sale in the next year or two. Brk, below $200, is my favourite stock pick given the current environment. Decent value. Some downside protection. $100 billion in cash.
james22 Posted August 25, 2019 Posted August 25, 2019 Not only is Berkshire selling at a large discount to our estimate of its intrinsic value, but we expect it to grow this value 8% to 10% annually over the long term. In addition, if the current discount narrows (i.e., BRK trades up from 1.26x to 1.50x book value), shares could be worth about $360 in five years, equivalent to a compound annual return of 13%. https://www.checkcapital.com/Research_Reports/BRKB_Report_0819.pdf Hat tip to mdtif. https://boards.fool.com/another-brk-bull-34280630.aspx?sort=postdate
alpha Posted August 27, 2019 Posted August 27, 2019 Some details about the hybrid electric locomotive BNSF is developing with Wabtec https://www.railwayage.com/mechanical/locomotives/bnsf-wabtec-advancing-the-future-of-motive-power/
Guest longinvestor Posted August 30, 2019 Posted August 30, 2019 Happy 89th Birthday to Warren Happy Birthday! Wishing he keep tap dancing to 100+.
John Hjorth Posted August 30, 2019 Posted August 30, 2019 Happy 89th Birthday to Warren. Cheers! Happy Birthday! Wishing he keep tap dancing to 100+. Happy 90th birthday to Mr. Buffett! - Yes, the 90th, you know, when a child reaches the age of one, it has had two birthdays - and so on! [ ; - ) ]
Guest longinvestor Posted September 1, 2019 Posted September 1, 2019 Buffett interview: Thanks for posting. Buffett looking sharp! Only thing noticeable is the heavy breathing which is somewhat familiar to me with my 90 year old mother. I wonder why Yahoo doesn’t try to edit that out. Interesting comment about being early in deploying cash during 2008-09. “Ran out of powder at the depth of the crisis”. $122B and counting = Lesson learned, ha?
John Hjorth Posted September 1, 2019 Posted September 1, 2019 Yes, interesting "out of powder"-comment related to the situation in the GFC. Cash & cash equivalents at USD 25.334 B at YE 2008. Thank you for sharing to Liberty.
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