Buffett/Berkshire - general news

[anony208]

9 hours ago, Luca said:

Like?

Black Knight Financial Services (now owned by ICE)

 

Controls more than 65% of the residential mortgage servicing technology market.

Edited February 26, 2024 by anony208

[KPO]

6 hours ago, gfp said:

 

I believe the consensus is Jimmy Haslam #3

Agreed and was surprised this reference wasn’t picked up earlier. He obviously views the Haslams as scum, which sounds about right based on the fact pattern. 

[UK]

17 hours ago, gfp said:

 

Well I would just like to say thanks for the post nwoodman!  I had just woken up, let out the puppy, and saw your post and said "What the fuck is the market doing??" and ran upstairs to start dumping BRK shares pre-market.  Sold from 430 all the way down to 424.  No clue what that market reaction was but I was like, "did they read the same report as me???"

 

Nimble move:). Curious if you sold it all / for good or until somewhat lower valuation?

[gfp]

3 hours ago, UK said:

 

Nimble move:). Curious if you sold it all / for good or until somewhat lower valuation?

 

I sold just about 10% of the total shares for accounts that still own Berkshire.  Even after selecting the highest basis shares possible (~$71.85 / b-share in these accounts) there is still a significant tax consequence to selling shares.  But 10% is a lot of money and still a lot of tax will be owed.  I don't personally own a lot of Berkshire anymore.

[UK]

35 minutes ago, gfp said:

 

I sold just about 10% of the total shares for accounts that still own Berkshire.  Even after selecting the highest basis shares possible (~$71.85 / b-share in these accounts) there is still a significant tax consequence to selling shares.  But 10% is a lot of money and still a lot of tax will be owed.  I don't personally own a lot of Berkshire anymore.

 

Thanks!

[MMM20]

3 hours ago, gfp said:

 

I sold just about 10% of the total shares for accounts that still own Berkshire.  Even after selecting the highest basis shares possible (~$71.85 / b-share in these accounts) there is still a significant tax consequence to selling shares.  But 10% is a lot of money and still a lot of tax will be owed.  I don't personally own a lot of Berkshire anymore.

 

Sounds like we're in a similar boat. I'd sold the BRK in my retirement accounts a few weeks ago to buy ~10% more FFH on the Muddy Waters report, and I just sold those extra FFH shares and bought the BRK back ~3% higher. But it's small and I sense that my return expectations are lower than most. If I can just beat cash owning a little bit of BRK as a cash substitute, I'll be happy. If BNSF and BHE are as troubled as he suggests, I might be nervous if I were one of those people with ~80%+ of my net worth in it with, like, a ~$10 cost basis... a high class problem!

 

Edited February 27, 2024 by MMM20

[sleepydragon]

Someone should do a sentiment analysis on all of WEB’s letters. When he sounds sour towards Brk’s prospects, what’s the next year’s return related to the market? I suspect this backtest will show it’s negative correlated (but it needs to be compared with years when he’s more bullish)

 

also, if what he says it’s right, it’s still better to own Brk then the Casino/market index.

[Charlie]

I also deleveraged my Berkshire shares from 105% to 100% of my portfolio.

Unfortunately I have to pay taxes, so it was not a No Brainer.

As Templeton said, if they desperately want to buy something, help them and sell it to them 

and when they desperately want to sell something, help them and buy it. 

I am ready for buying again. 

[gfp]

16 minutes ago, MMM20 said:

 

Sounds like we're in a similar boat. I'd sold the BRK in my retirement accounts a few weeks ago to buy ~10% more FFH on the Muddy Waters report, and I just sold those extra FFH shares and bought the BRK back ~3% higher. But it's small and I sense that my return expectations are lower than most. If I can just beat cash owning a little bit of BRK as a cash substitute, I'll be happy. If BNSF and BHE are as troubled as he suggests, I might be nervous if I were one of those people with ~80%+ of my net worth in it with, like, a ~$10 cost basis... a high class problem!

 

 

The only accounts I manage that still have Berkshire in them are fully taxable accounts with very large positions in Berkshire shares at very low cost basis.  The type of position those account owners intend to transfer to their heirs and chosen causes on death.  I can't do much with it without causing them a bunch of problems but it counts towards my investment performance so I do what I can around the edges and borrow against it in reasonable amounts.

[Munger_Disciple]

1 minute ago, gfp said:

 

The only accounts I manage that still have Berkshire in them are fully taxable accounts with very large positions in Berkshire shares at very low cost basis.  The type of position those account owners intend to transfer to their heirs and chosen causes on death.  I can't do much with it without causing them a bunch of problems but it counts towards my investment performance so I do what I can around the edges and borrow against it in reasonable amounts.

 

I take it you manage SMAs? Is there a web site people can get information? Thanks

[gfp]

10 minutes ago, Munger_Disciple said:

 

I take it you manage SMAs? Is there a web site people can get information? Thanks

 

Yes SMAs but no website, not a registered investment advisor and only have 10 clients and that's all I will ever have  (edit: could definitely have fewer!)

Edited February 27, 2024 by gfp

[Munger_Disciple]

1 minute ago, gfp said:

 

Yes SMAs but no website, not a registered investment advisor and only have 10 clients and that's all I will ever have

 

Got it, thanks

Edited February 27, 2024 by Munger_Disciple

[Munger_Disciple]

18 minutes ago, gfp said:

only have 10 clients and that's all I will ever have  (edit: could definitely have fewer!)

 

 I know what you mean; very much appreciate all your posts.

[John Hjorth]

Albert Einstein Medical College [Bronx,NY,  February 26^th 2024] : Montefiore's Albert Einstein College of Medicine Announces Free Tuition in Perpetuity for All Medical School Students.

 

- - - o 0 o - - -

 

Made Possible by Transformational Gift - the Largest to Any Medical School in the Country.

 

R.I.P. Mr. Gottesman.

[redskin]

On 2/25/2024 at 10:38 PM, gfp said:

 

He has received his entire cost basis back in dividends and retains an extremely profitable, durable enterprise that has comparable valuations  (UNP = $155 Billion, replacement cost ~$500 Billion ??) that are favorable and the "capital eating enterprise" continues to pay out several billions of cash every year in tax free dividends to the owner.  I think it was a once in a lifetime opportunity to buy an irreplaceable productive asset that is almost impossible to buy out of the public markets.  He was pretty psyched.

Berkshire has received $53.68 billion in dividends from BNSF since its purchase in 2009.  Did he pay $34B for it?

[villainx]

Wondering why Berkshire doesn’t have an arm in its business to do CSU type smaller deals. I know in grand scheme of things it won’t be needle moving but the company already has Sees and Diary Queen, and can do more in that space. At the least it’ll build a competent group of acquirers and managers. Maybe the risk isn’t worth the small rewards, but just waiting for an elephant to come to crosshairs leaves a lot of smaller worthwhile game to pass. 

[Xerxes]

18 hours ago, redskin said:

Berkshire has received $53.68 billion in dividends from BNSF since its purchase in 2009.  Did he pay $34B for it?

 

showing off from my new book. 
Excerpt from 2009, 2010 and 2011 letters on BNSF. 
 

$22B in cash + 6% of the company 

Excluding the stake they already had. 
 

Did Berkshire gave away too much by issuing away 6% of Berkshire. That is $54 billion on a market cap of $900 billion todays price. 

 

[keegomaster]

4 hours ago, Xerxes said:

 

showing off from my new book. 
Excerpt from 2009, 2010 and 2011 letters on BNSF. 
 

$22B in cash + 6% of the company 

Excluding the stake they already had. 
 

Did Berkshire gave away too much by issuing away 6% of Berkshire. That is $54 billion on a market cap of $900 billion todays price. 

 

Interesting, what book is this?

[Xerxes]

39 minutes ago, keegomaster said:

Interesting, what book is this?

 

great stuff 

[xboojum]

6 hours ago, villainx said:

Wondering why Berkshire doesn’t have an arm in its business to do CSU type smaller deals. I know in grand scheme of things it won’t be needle moving but the company already has Sees and Diary Queen, and can do more in that space. At the least it’ll build a competent group of acquirers and managers. Maybe the risk isn’t worth the small rewards, but just waiting for an elephant to come to crosshairs leaves a lot of smaller worthwhile game to pass. 

 

I had hoped that Marmon would turn into this for small/midsized industrials. It's not clear if it hasn't, really, or if the acquisitions are just not sizable enough, even in aggregate, to be really noticeable.

[redskin]

7 hours ago, Xerxes said:

 

showing off from my new book. 
Excerpt from 2009, 2010 and 2011 letters on BNSF. 
 

$22B in cash + 6% of the company 

Excluding the stake they already had. 
 

Did Berkshire gave away too much by issuing away 6% of Berkshire. That is $54 billion on a market cap of $900 billion todays price. 

 

So it looks like it was worth giving up the 6%

[gfp]

Greg Abel is leaving the Kraft Heinz board.  I doubt there is much to read into this, probably just time management.  Greg had a large increase in workload.  Two Berkshire designees will remain on the KHC board.

 

https://www.sec.gov/ixviewer/ix.html?doc=/Archives/edgar/data/1637459/000163745924000029/khc-20240222.htm

[Cigarbutt]

3 hours ago, gfp said:

Greg Abel is leaving the Kraft Heinz board.  I doubt there is much to read into this, probably just time management.  Greg had a large increase in workload.  Two Berkshire designees will remain on the KHC board.

 

https://www.sec.gov/ixviewer/ix.html?doc=/Archives/edgar/data/1637459/000163745924000029/khc-20240222.htm

A word about Timothy Kenesey, who may have some work to do in his main line of business.

And a word about MedPro, the gem bought by BRK in 2005 for 825M. A gem like so many others hidden in plain sight within consolidated numbers. The MedPro topic is expanded upon here slightly as there may be a correlated message to another contemporary topic here related to unrecognized value when an insurer has recently entered a hard market. 

When BRK bought MedPro, their market was in a mess but an unrecognized recovery was already under way (i guess it felt like then what is felt like now in relation to BHE's prospects?).

Retrospective look to the period before the 2005 acquisition:

The above is the total return curve for the industry's lines where MedPro has been evolving. The poor numbers reported in the 2001-3 period were affected by poor investment results but especially by bad underwriting results (both accident and calendar year reporting). So BRK bought in 2005 for 1.5x surplus value.

And then:

The above are MedPro's results in the years following the acquisition. 

Ok this may be simply boring historical stuff but the MedPro gem is very likely about to (next few years) report very strong results.

Of note: the 'premium' paid in 2005, in retrospect, suggests that what GE accepted as a 'price' was not exactly efficient.

[jbwent63]

I apologize for not remembering who was posting the NICO regulatory filings, but if they would be so kind as to do so for year end it would be much appreciated. Especially the investment section. Thanks in advance.

[gfp]

12 minutes ago, jbwent63 said:

I apologize for not remembering who was posting the NICO regulatory filings, but if they would be so kind as to do so for year end it would be much appreciated. Especially the investment section. Thanks in advance.

 

Cheers - I will post them but they are not out yet.  The Annual filings take a bit longer to be published.  I've seen quarterly filings actually come out before a company's 10Q before (which must be a no-no) - but never for a BRK sub.

 

edit:  if you are hoping to learn the "secret" financial security you will probably be out of luck (same as Q3) because it is hidden inside the Harney Investment Trust, Warren's go-to disclosure obscurer (is that a word?)

Edited February 29, 2024 by gfp