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BRK Intrinsic Value


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I have a few questions: and pardon my laziness (because I'm sure the answers that I am seeking are all in the K).

 

Buffett offers a framework for valuing BRK: per-share value of investment securities + pre-tax earnings of non-insurance subs. Throw some multiples on the second metric (and add it to the first metric) and you get a fair value range for the company. From the shareholder letter (the most recent one), these metrics were $140,123 and $10,847 respectively.

 

My questions are these:

 

1) Is the $140,123 metric pre-tax (i.e., does not deduct the DTL associated with capital gains over the years)? And if this is a pre-tax metric, why doesn't it make sense to look at this metric on an after-tax basis? I get that BRK is a long-term shareholder and a portion of its positions (KO, WFC, IBM, etc.) are permanent, but to be conservative, does it not make sense to apply some sort of discount to this # (maybe not all of the DTL but maybe subtract 25%/50% of the DTL).

 

2) Does the $10,847 metric subtract out all corporate OH (I know this # is small; but I am sure Ted/Todd are making pretty good money) and all corporate-level interest charges? If so, is it fair to assume that if I throw a 40% tax rate on this #, the after-tax earnings of BRK's non-insurance subs are c. $6,500 / share?

 

3) Final question, and sorry again for my laziness, should I add some additional amount to metric 2 (i.e., $10,847) to capture the underwriting profits generated by the insurance subs? They have been profitable for 12 straight years!

 

Thanks again. I am not sure that BRK represents great absolute value at current levels. On a relative basis, it seems OK: 10-year average P/B relative to the S&P500 is 0.61x and current P/B relative to the S&P 500 is 0.55 (low over the last 10-years relative the S&P 500 is 0.51 and high is 0.85).

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I have a few questions: and pardon my laziness (because I'm sure the answers that I am seeking are all in the K).

 

Buffett offers a framework for valuing BRK: per-share value of investment securities + pre-tax earnings of non-insurance subs. Throw some multiples on the second metric (and add it to the first metric) and you get a fair value range for the company. From the shareholder letter (the most recent one), these metrics were $140,123 and $10,847 respectively.

 

My questions are these:

 

1) Is the $140,123 metric pre-tax (i.e., does not deduct the DTL associated with capital gains over the years)? And if this is a pre-tax metric, why doesn't it make sense to look at this metric on an after-tax basis? I get that BRK is a long-term shareholder and a portion of its positions (KO, WFC, IBM, etc.) are permanent, but to be conservative, does it not make sense to apply some sort of discount to this # (maybe not all of the DTL but maybe subtract 25%/50% of the DTL).

 

2) Does the $10,847 metric subtract out all corporate OH (I know this # is small; but I am sure Ted/Todd are making pretty good money) and all corporate-level interest charges? If so, is it fair to assume that if I throw a 40% tax rate on this #, the after-tax earnings of BRK's non-insurance subs are c. $6,500 / share?

 

3) Final question, and sorry again for my laziness, should I add some additional amount to metric 2 (i.e., $10,847) to capture the underwriting profits generated by the insurance subs? They have been profitable for 12 straight years!

 

Thanks again. I am not sure that BRK represents great absolute value at current levels. On a relative basis, it seems OK: 10-year average P/B relative to the S&P500 is 0.61x and current P/B relative to the S&P 500 is 0.55 (low over the last 10-years relative the S&P 500 is 0.51 and high is 0.85).

 

If you want to figure out BRK's intrinsic value I would suggest that you do read the K and then read it again. When ur done read the past 15 Ks, then read the last 4 again. BRK is a massive company, you're not going to value it without even reading the current K.

 

Now to your points.

 

1. What Buffett did was provide some guidelines about how to think about BRK's valuation he didn't sit down to do all the calculations for you. So yes the value of the securities is pre-tax. There is a deferred tax liability associated with it which you adjust as you see fit and subtract it. There's also another liability attached to it called float. You want to account for that one too, since you know they have to pay out for insurance losses.

 

2. For the earnings of the operating subs you may want to apply an appropriate pre tax multiple to that. Of value mid-American and bnsf separately then apply a multiple to the rest (14x seems reasonable). BTW why would you apply a 40% tax rate when they don't pay that and moreover nobody pays that? Headquarters O/H is meaningless.

 

3. You should value the underwriting profits as you see fit based on your estimation of what they will be going forward. Be careful not to double count them when you value the float.

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  • 1 month later...

All of the IV discussion has focused on what can be calculated. That is, two of three pillars of IV: Investments/Share($140123)+ Earnings/Share($10,847)

 

The third pillar, which is subjective and futuristic: How the retained earnings will be deployed in the future. One-Dollar-turned-into-TBD$

Leaving aside the speculation of whether they will turn a retained dollar to more or less than a dollar, the magnitude of the retained dollars at BRK is starting to become staggering.

 

From Page 50 of the AR, Shareholder's equity table, here are the YE RE$

2011: $109 B

2012: $124 B

2013: $144 B

2014: $164 B

 

From page 123, IV today and tomorrow, "We, as well as many other businesses, are likely to retain earnings over the next decade that will equal, or even exceed, the capital we presently employ" - WEB, 2010.

 

What's this worth?

 

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BV and historical multiples are increasingly inappropriate for BRK.

 

Why?

By 2020, half or more of ALL Retained earnings since BRK came into existence would have accumulated since 2009. History, and especially going back to the 90's or before is meaningless.

 

Where are the retained earnings primarily being put to work?

Roughly half into the capital intensive businesses. These are generating tax credits as well as the deferred tax float spreading out 30 to 80 years. Even at par, that is, one-dollar-retained-produces-1-dollar, using a NPV of these multiplying rabbits is far more appropriate than the historical BV multiple. BV as a number is becoming ridiculous and divorced from IV. As a corollary, the mantra "change in BV roughly reflects change in IV" will also turn out to be ridiculous. The "roughly" will hold, nothing else in this statement. 

 

The numbers are mind boggling.

 

There is another intangible aspect to the recent RE momentum story. In the year 2020, if the RE starts to show up as predicted in the calculable pillars of IV(Investments and Earnings per share), it will largely vindicate capital allocation decisions made by the not-Buffetts within BRK. The 80-20 rule is at work. Buffett would have made 20% of the incremental decisions in the ten year period since 2009. We will see what one dollar in these folks' hands turned into.

 

All of this is subjective of course.

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TL:DR, what is your estimate for IV?

 

I have a simple spreadsheet that does a modified two-column valuation based on the current financials.  The current, imo conservative, IV estimate is:

 

Per A share = $ 219,000

Per B share = $ 145

 

Somewhere in the neighborhood of 1.5 x BV

 

I would say BRK is, at best, only modestly undervalued at current prices.  You might say it's in the low end of the range of fair value.

 

My little spreadsheet goes back to around 2001 with its calculations.  By this measure, BRK was clearly undervalued in 2011 and 2012 and has moved towards fair value since then.  Not a huge revelation given the buy-back activities around that time and Buffet's own discussion of BRK's valuation.  In mid to late 2012 you could buy BRK between $70 and $80 (per B share) while my simple estimate of IV was slightly above $100.  It was around that time that some people (including myself) were going long BRK Leaps, which turned out pretty well.

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What is your interpretation of the conventional two column approach? What about your approach is modified?

 

I don't just use the value of investments; I look at the equity of the insurance operations instead.  Then I add to it the value of the pre-tax operating earnings (annualized pre-tax earnings x 9).  It's still a simple order of magnitude measure, that is purely mechanical and partially fitted to the past data. 

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What is your interpretation of the conventional two column approach? What about your approach is modified?

 

I don't just use the value of investments; I look at the equity of the insurance operations instead.  Then I add to it the value of the pre-tax operating earnings (annualized pre-tax earnings x 9).  It's still a simple order of magnitude measure, that is purely mechanical and partially fitted to the past data.

 

I don't think this is a good way to value the company.  I believe a lot of the operating companies are owned by the insurance subsidiaries, including BNSF.  Therefore the book value of BNSF would be included in the insurance equity.  You could do this but you would need to exclude BNSF operating earnings and all other operating companies owned by insurance subs.

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What is your interpretation of the conventional two column approach? What about your approach is modified?

 

I don't just use the value of investments; I look at the equity of the insurance operations instead.  Then I add to it the value of the pre-tax operating earnings (annualized pre-tax earnings x 9).  It's still a simple order of magnitude measure, that is purely mechanical and partially fitted to the past data.

 

I don't think this is a good way to value the company.  I believe a lot of the operating companies are owned by the insurance subsidiaries, including BNSF.  Therefore the book value of BNSF would be included in the insurance equity.  You could do this but you would need to exclude BNSF operating earnings and all other operating companies owned by insurance subs.

 

I'm aware of the odd ownership structure of some of the subs, but if you look at the consolidated balance sheets, Rail, Utilities, and Energy assets are separated from the insurance operations.  The insurance assets are almost entirely financial, so I don't think I'm double counting significantly there. 

 

 

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I have a few questions: and pardon my laziness (because I'm sure the answers that I am seeking are all in the K).

 

Buffett offers a framework for valuing BRK: per-share value of investment securities + pre-tax earnings of non-insurance subs. Throw some multiples on the second metric (and add it to the first metric) and you get a fair value range for the company. From the shareholder letter (the most recent one), these metrics were $140,123 and $10,847 respectively.

 

My questions are these:

 

1) Is the $140,123 metric pre-tax (i.e., does not deduct the DTL associated with capital gains over the years)? And if this is a pre-tax metric, why doesn't it make sense to look at this metric on an after-tax basis? I get that BRK is a long-term shareholder and a portion of its positions (KO, WFC, IBM, etc.) are permanent, but to be conservative, does it not make sense to apply some sort of discount to this # (maybe not all of the DTL but maybe subtract 25%/50% of the DTL).

 

2) Does the $10,847 metric subtract out all corporate OH (I know this # is small; but I am sure Ted/Todd are making pretty good money) and all corporate-level interest charges? If so, is it fair to assume that if I throw a 40% tax rate on this #, the after-tax earnings of BRK's non-insurance subs are c. $6,500 / share?

 

3) Final question, and sorry again for my laziness, should I add some additional amount to metric 2 (i.e., $10,847) to capture the underwriting profits generated by the insurance subs? They have been profitable for 12 straight years!

 

Thanks again. I am not sure that BRK represents great absolute value at current levels. On a relative basis, it seems OK: 10-year average P/B relative to the S&P500 is 0.61x and current P/B relative to the S&P 500 is 0.55 (low over the last 10-years relative the S&P 500 is 0.51 and high is 0.85).

 

 

 

I hope this doesn't come across as rude, especially since I just joined this forum.  But, no, I don't think I can pardon your laziness.  As another commented, go back and read other letters / 10k's.  Better yet, grab the latest compilation of letters and read all 50 going back to 1965!  Use your curiosity to dig deeper.  Ask, 'Does book value include deferred tax liabilities?' Grab an accounting book, or search online. (Hint: look at the statement "Consolidated Statements of Comprehensive Income". ) I'll leave you with a Munger quote, "I can't tell you how to get rich with soft white hands." Read: It's going to require some work.

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TL:DR, what is your estimate for IV?

 

I have a simple spreadsheet that does a modified two-column valuation based on the current financials.  The current, imo conservative, IV estimate is:

 

Per A share = $ 219,000

Per B share = $ 145

 

Somewhere in the neighborhood of 1.5 x BV

 

I would say BRK is, at best, only modestly undervalued at current prices.  You might say it's in the low end of the range of fair value.

 

My little spreadsheet goes back to around 2001 with its calculations.  By this measure, BRK was clearly undervalued in 2011 and 2012 and has moved towards fair value since then.  Not a huge revelation given the buy-back activities around that time and Buffet's own discussion of BRK's valuation.  In mid to late 2012 you could buy BRK between $70 and $80 (per B share) while my simple estimate of IV was slightly above $100.  It was around that time that some people (including myself) were going long BRK Leaps, which turned out pretty well.

 

I think the intrinsic value is considerably higher than $219,000.  I like to take Buffett's advice and use a simple addition of cash/investments and (pre tax operating earnings*multiple).  $140,000 + (11,000*10) = $250,000.

 

A few other observations/questions....

 

BHE pre tax earnings were $2.7 B in 2014.  Buffett has said BHE's renewable portfolio upon completion will have cost $15 billion.  During a shareholder meeting a few years back, Buffett said he would be satisfied with 12% returns on capital in the utility business.  How much of the $15 billion investment is currently online.  This should create an additional $1.8 billion of pretax operating earnings or $1,000/share? 

 

Buffett has twice mentioned in annual letters the difference between what the tank cars are worth and the value on the books.  They currently own 105,000 tank cars on the books at $5 billion.  Buffett has said these new cars sell for over $100,000.  A difference of over $5 billion.

 

The Heinz preferred and common shares are currently on the books at $11 billion.  Once the Kraft/Heinz shares are valued at market the common will be worth approximately $21 billion using the current KFT price.  He will contribute an additional $5 billion cash at closing.  The Kraft/Heinz investment will be worth $21b + $8 b preferred= $29B.  Should increase investments and cash by $13B. $29B - ($11B + $5B cash) or $8,000/share?

 

How much is the $60 billion of cash worth?  If Buffett is able to invest $60 billion over the next few years in operating companies that produce 10% pre tax returns, pre tax operating earnings will increase by $6B or $3,650/share.

 

What will the numbers look like in 3 years? 

 

Current investments/cash (with Kraft/Heinz valuation adjustment) $148,000/share.  Subtract $60 billion cash ($36,000/share)= $112,000/share.  Buffett makes 8% annually on investments over 3 years.  $141,000/share.

 

Current pre tax operating earnings/share $10,850.  Add $1,000/share as utility projects come on line.  $11,850 increases 5% annually organically over next 3 years.  Will become $13,717/share.  Add $3,650/share as $60 billion of cash is deployed at 10% pre tax return.  Total in 3 years = $17,367/share.

 

Cash continues to build.  Even after $60B deployed, cash is approximately $50B or $30,000/share in 3 years.

 

In summary, Cash/investments/share= $171,000.  Pre tax operating earnings= $17,367/share.

 

$171,000 + ($17,367*10)= $344,000/share

 

This would be an annualized return of 17.5% on the current $212,000 share price.

 

 

 

 

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What is your interpretation of the conventional two column approach? What about your approach is modified?

 

I don't just use the value of investments; I look at the equity of the insurance operations instead.  Then I add to it the value of the pre-tax operating earnings (annualized pre-tax earnings x 9).  It's still a simple order of magnitude measure, that is purely mechanical and partially fitted to the past data.

 

You may be right.

I don't think this is a good way to value the company.  I believe a lot of the operating companies are owned by the insurance subsidiaries, including BNSF.  Therefore the book value of BNSF would be included in the insurance equity.  You could do this but you would need to exclude BNSF operating earnings and all other operating companies owned by insurance subs.

 

I'm aware of the odd ownership structure of some of the subs, but if you look at the consolidated balance sheets, Rail, Utilities, and Energy assets are separated from the insurance operations.  The insurance assets are almost entirely financial, so I don't think I'm double counting significantly there.

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I valued BRK recently and this is how I look at it.

 

In 2015 Berkshire produced Cash from Operations of $32.010 Billion. They spent $15.185 Billion in Capital Expenditures but many of these were growth capex. I come up with a rough estimate, but with the various businesses it would be hard to get a precise figure, of about $8.9 Billion of Maintenance Capex for Owner Earnings of $23.1 Billion.

 

But this number does not include Berkshire's look-through earnings which are very significant. Of Berkshire's equity securities only the dividends show up on the consolidated financial statements. So, I went through and calculated my estimate of OE for ALL of Berkshires securities, Berkshires ownership of the company, and then what their earnings would be if they were sent to Berkshire.

 

I came up with $6.6 Billion of look-through Owner Earnings, again a rough figure with lots of assumptions but I'm comfortable with it.

 

So in 2015 I believe Berkshire had around $29.795 Billion in OE. And around $37 Billion of excess cash (Buffett has said he won't got below $20 Billion).

 

If you think about what Berkshire's Earnings will look like say 5 or 10 years from now, and the current stock price I think it looks interesting. In a world where not much is interesting at the moment.

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I think the intrinsic value is considerably higher than $219,000.  I like to take Buffett's advice and use a simple addition of cash/investments and (pre tax operating earnings*multiple).  $140,000 + (11,000*10) = $250,000.

 

A few other observations/questions....

 

BHE pre tax earnings were $2.7 B in 2014.  Buffett has said BHE's renewable portfolio upon completion will have cost $15 billion.  During a shareholder meeting a few years back, Buffett said he would be satisfied with 12% returns on capital in the utility business.  How much of the $15 billion investment is currently online.  This should create an additional $1.8 billion of pretax operating earnings or $1,000/share? 

 

Buffett has twice mentioned in annual letters the difference between what the tank cars are worth and the value on the books.  They currently own 105,000 tank cars on the books at $5 billion.  Buffett has said these new cars sell for over $100,000.  A difference of over $5 billion.

 

The Heinz preferred and common shares are currently on the books at $11 billion.  Once the Kraft/Heinz shares are valued at market the common will be worth approximately $21 billion using the current KFT price.  He will contribute an additional $5 billion cash at closing.  The Kraft/Heinz investment will be worth $21b + $8 b preferred= $29B.  Should increase investments and cash by $13B. $29B - ($11B + $5B cash) or $8,000/share?

 

How much is the $60 billion of cash worth?  If Buffett is able to invest $60 billion over the next few years in operating companies that produce 10% pre tax returns, pre tax operating earnings will increase by $6B or $3,650/share.

 

What will the numbers look like in 3 years? 

 

Current investments/cash (with Kraft/Heinz valuation adjustment) $148,000/share.  Subtract $60 billion cash ($36,000/share)= $112,000/share.  Buffett makes 8% annually on investments over 3 years.  $141,000/share.

 

Current pre tax operating earnings/share $10,850.  Add $1,000/share as utility projects come on line.  $11,850 increases 5% annually organically over next 3 years.  Will become $13,717/share.  Add $3,650/share as $60 billion of cash is deployed at 10% pre tax return.  Total in 3 years = $17,367/share.

 

Cash continues to build.  Even after $60B deployed, cash is approximately $50B or $30,000/share in 3 years.

 

In summary, Cash/investments/share= $171,000.  Pre tax operating earnings= $17,367/share.

 

$171,000 + ($17,367*10)= $344,000/share

 

This would be an annualized return of 17.5% on the current $212,000 share price.

 

Redskin, thanks for your additional comments. 

 

My intent for creating my spreadsheet was to take readily available financials that could be tracked over time to ballpark IV in a simple and conservative way.  It's a relatively small adjustment to the two-column approach outlined by Buffett and produces IV estimates that are consistent and not wildly out of line.  It seems to work well enough for my purposes.  I know it's overly simplified, and probably a bit too conservative.  But, seeing how the IV pieces develop over time is interesting, as is tracking that against historical prices.

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I valued BRK recently and this is how I look at it.

 

In 2015 Berkshire produced Cash from Operations of $32.010 Billion. They spent $15.185 Billion in Capital Expenditures but many of these were growth capex. I come up with a rough estimate, but with the various businesses it would be hard to get a precise figure, of about $8.9 Billion of Maintenance Capex for Owner Earnings of $23.1 Billion.

 

But this number does not include Berkshire's look-through earnings which are very significant. Of Berkshire's equity securities only the dividends show up on the consolidated financial statements. So, I went through and calculated my estimate of OE for ALL of Berkshires securities, Berkshires ownership of the company, and then what their earnings would be if they were sent to Berkshire.

 

I came up with $6.6 Billion of look-through Owner Earnings, again a rough figure with lots of assumptions but I'm comfortable with it.

 

So in 2015 I believe Berkshire had around $29.795 Billion in OE. And around $37 Billion of excess cash (Buffett has said he won't got below $20 Billion).

 

If you think about what Berkshire's Earnings will look like say 5 or 10 years from now, and the current stock price I think it looks interesting. In a world where not much is interesting at the moment.

 

I do something very similar. I start with net income and add back looks through earnings (minus dividends that already show up in Net Income) plus intangible asset amortization minus investment capital gains/losses. Using this I get $23.3B in earnings.

 

Either way, I think we get to the same conclusion of "the current stock price I think it looks interesting. In a world where not much is interesting at the moment." With the lower of the two numbers (23.3B), Berkshire is trading at 14 P/E ratio. I much favor graham's side by side comparison of two options to trying to put a precise number on intrinsic value. Berkshire next to the S&P500 at 20x, KO at 25x or PG at 22x all seem like no brainers to me (Berkshire compared to other stable growth with strong balance sheets and diversified businesses).  The side by side comparison would include more than a P/E ratio, but I think we all get the point that in terms of large caps with very predictable futures, I have yet to see anything with similarly relatively attractive valuations.

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I valued BRK recently and this is how I look at it.

 

In 2015 Berkshire produced Cash from Operations of $32.010 Billion. They spent $15.185 Billion in Capital Expenditures but many of these were growth capex. I come up with a rough estimate, but with the various businesses it would be hard to get a precise figure, of about $8.9 Billion of Maintenance Capex for Owner Earnings of $23.1 Billion.

 

But this number does not include Berkshire's look-through earnings which are very significant. Of Berkshire's equity securities only the dividends show up on the consolidated financial statements. So, I went through and calculated my estimate of OE for ALL of Berkshires securities, Berkshires ownership of the company, and then what their earnings would be if they were sent to Berkshire.

 

I came up with $6.6 Billion of look-through Owner Earnings, again a rough figure with lots of assumptions but I'm comfortable with it.

 

So in 2015 I believe Berkshire had around $29.795 Billion in OE. And around $37 Billion of excess cash (Buffett has said he won't got below $20 Billion).

 

If you think about what Berkshire's Earnings will look like say 5 or 10 years from now, and the current stock price I think it looks interesting. In a world where not much is interesting at the moment.

 

I do something very similar. I start with net income and add back looks through earnings (minus dividends that already show up in Net Income) plus intangible asset amortization minus investment capital gains/losses. Using this I get $23.3B in earnings.

 

Either way, I think we get to the same conclusion of "the current stock price I think it looks interesting. In a world where not much is interesting at the moment." With the lower of the two numbers (23.3B), Berkshire is trading at 14 P/E ratio. I much favor graham's side by side comparison of two options to trying to put a precise number on intrinsic value. Berkshire next to the S&P500 at 20x, KO at 25x or PG at 22x all seem like no brainers to me (Berkshire compared to other stable growth with strong balance sheets and diversified businesses).  The side by side comparison would include more than a P/E ratio, but I think we all get the point that in terms of large caps with very predictable futures, I have yet to see anything with similarly relatively attractive valuations.

 

Oh yea I do subtract the dividends also. Forgot to mention that

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A billion dollars of incremental annual earnings thanks to the growing retained earnings has an NPV between $5K to $10K per share. Using 5% and 10% discount rates for 30 years. This is just with the BNSF + BHE, and it is not incorrect to NPV for 50 or 80 years. And with just the known stuff that's already in the bag, like the tax credits and deferred tax float (rabbits). 

 

1 foot hurdles for as long as the eye can see, investing in the mother lode of opportunities. 

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I agree that Berkshire looks a lot more attractive than other large caps.

 

Berkshire is growing fasterm has a great business model, and is cheaper than the market.

 

I was also struck by Munger's bullish outlook in the letter. Even with mediocre leadership post-Buffett ( which is unlikely), he expects Berkshire will do well.

 

His comment about rising activism driving more companies into the Berkshire fold will prove prescient, IMO.

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"I was also struck by Munger's bullish outlook in the letter. Even with mediocre leadership post-Buffett ( which is unlikely), he expects Berkshire will do well."

 

Munger: "The one place a death will hurt is we´re not likely to get as good an allocator of capital as Warren in the next CEO, whoever that is.

But it still will be one hell of a business."  :)

(from Damn Right! page 250)

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One other comment, I also calculated Berkshires Owner Earnings + Look-through earnings for 2004 and 2009

 

2004

OE of about $8.5 Billion or $5,522 Per A Share

 

2009

OE of about $14.3 Billion or $9,224 Per A Share

 

2015

OE of about $29.8 Billion or $18,135 Per A Share

 

So for me the question is how long does it take them to double earnings again? Probably a little longer than in the past but I suspect not by much.

 

 

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  • 1 month later...

One other comment, I also calculated Berkshires Owner Earnings + Look-through earnings for 2004 and 2009

 

2004

OE of about $8.5 Billion or $5,522 Per A Share

 

2009

OE of about $14.3 Billion or $9,224 Per A Share

 

2015

OE of about $29.8 Billion or $18,135 Per A Share

 

So for me the question is how long does it take them to double earnings again? Probably a little longer than in the past but I suspect not by much.

 

I'm bored.

 

So thought I'd calculate OE for the next 30 years. Between 2005 and 2015 OE has grown >10%. I just use the reported OE numbers from the AR.

 

Assuming 9% CAGR for the next 10,

5% for the next 10

3% for the next 10

 

BRK has gotten too big and all that!

 

NPV looks really interesting.

 

Back to being bored.

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I'm bored.

 

So thought I'd calculate OE for the next 30 years. Between 2005 and 2015 OE has grown >10%

 

Assuming 9% CAGR for the next 10,

5% for the next 10

3% for the next 10

 

BRK has gotten too big and all that!

 

NPV looks really interesting.

 

Back to being bored.

 

I'll bite, what's the result?

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