Gregmal Posted March 12, 2020 Share Posted March 12, 2020 Why not just quietly accumulate GOOG and MSFT? Link to comment Share on other sites More sharing options...
rb Posted March 12, 2020 Share Posted March 12, 2020 They won't buy MSFT because of Gates. But at this point they may as well buy OXY. Chump change. Link to comment Share on other sites More sharing options...
Jurgis Posted March 12, 2020 Share Posted March 12, 2020 They won't buy MSFT because of Gates. But at this point they may as well buy OXY. Chump change. You think Buffett would buy E&P even if it is cheap? I'd think it's too commodity and too future-uncertain. BTW, I think he might buy OXY notes or prefs or even stock as a trade. But not whole co. Link to comment Share on other sites More sharing options...
Mephistopheles Posted March 12, 2020 Share Posted March 12, 2020 If airlines I bet he takes out Southwest Super clean balance sheet, great culture, happy employees, happy customers, and he was friends with Herb Kellehar the founder Link to comment Share on other sites More sharing options...
Jurgis Posted March 12, 2020 Share Posted March 12, 2020 He explicitly said he won't buy an airline. Link to comment Share on other sites More sharing options...
Mephistopheles Posted March 12, 2020 Share Posted March 12, 2020 He explicitly said he won't buy an airline. Yes he gave an example of problems with the amex card and buying delta but I think southwest is different. He also said he'd never invest in airline (stocks) again. Never say never. Link to comment Share on other sites More sharing options...
compoundinglife Posted March 12, 2020 Share Posted March 12, 2020 He explicitly said he won't buy an airline. He said it was unlikely and cited the reasons why its complicate for BRK to buy one. I left with the impression that he might consider it in extraordinary circumstances. "It'd be very unlikely we would do that," Buffett said. "I'm not saying it's impossible, but, it's complicated. There's a lot of complications because it's a regulated industry. Anytime you get into a regulated industry, you have more complications in transactions." Link to comment Share on other sites More sharing options...
Castanza Posted March 12, 2020 Share Posted March 12, 2020 SAVE is a 3.9B EV...that's chump change. Never say never is right. Link to comment Share on other sites More sharing options...
gfp Posted March 12, 2020 Author Share Posted March 12, 2020 Yeah he really only addressed the issue with buying Delta and Delta seems like his favorite. Nothing to stop him from buying Southwest if he wanted it and they agreed. He would then likely sell all the other positions similar to how the train deal went down. Link to comment Share on other sites More sharing options...
Jurgis Posted March 12, 2020 Share Posted March 12, 2020 He explicitly said he won't buy an airline. He said it was unlikely and cited the reasons why its complicate for BRK to buy one. I left with the impression that he might consider it in extraordinary circumstances. "It'd be very unlikely we would do that," Buffett said. "I'm not saying it's impossible, but, it's complicated. There's a lot of complications because it's a regulated industry. Anytime you get into a regulated industry, you have more complications in transactions." Yeah, he's too smart to not leave himself an out. I'll bet that he won't. See him buy airline tomorrow. 8) Link to comment Share on other sites More sharing options...
compoundinglife Posted March 12, 2020 Share Posted March 12, 2020 He explicitly said he won't buy an airline. He said it was unlikely and cited the reasons why its complicate for BRK to buy one. I left with the impression that he might consider it in extraordinary circumstances. "It'd be very unlikely we would do that," Buffett said. "I'm not saying it's impossible, but, it's complicated. There's a lot of complications because it's a regulated industry. Anytime you get into a regulated industry, you have more complications in transactions." Yeah, he's too smart to not leave himself an out. I'll bet that he won't. See him buy airline tomorrow. 8) Agreed. I think a pref + warrant deal is more likely with the airlines. On the flip side, there must be some advantages to owning NetJets and major airline. For example a loyalty program that spanned both. Efficiency improvements? Speculating, I don't know enough about the businesses to know if it impact returns. Link to comment Share on other sites More sharing options...
Jurgis Posted March 12, 2020 Share Posted March 12, 2020 Agreed. I think a pref + warrant deal is more likely with the airlines. On the flip side, there must be some advantages to owning NetJets and major airline. For example a loyalty program that spanned both. Efficiency improvements? Speculating, I don't know enough about the businesses to know if it impact returns. Hmm, is NetJets a success currently? I remember it was not doing great at some point. I think it's too small to be mentioned anymore, so probably we can't know how it is doing. Link to comment Share on other sites More sharing options...
compoundinglife Posted March 12, 2020 Share Posted March 12, 2020 Agreed. I think a pref + warrant deal is more likely with the airlines. On the flip side, there must be some advantages to owning NetJets and major airline. For example a loyalty program that spanned both. Efficiency improvements? Speculating, I don't know enough about the businesses to know if it impact returns. Hmm, is NetJets a success currently? I remember it was not doing great at some point. I think it's too small to be mentioned anymore, so probably we can't know how it is doing. Your right. It’s just a blip. Internet estimates put it around 300M top line in 2019. Link to comment Share on other sites More sharing options...
CassiusKing1 Posted March 13, 2020 Share Posted March 13, 2020 Caterpillar pretty easily or Coca Cola for a stretch. Link to comment Share on other sites More sharing options...
alpha Posted March 13, 2020 Share Posted March 13, 2020 Agreed. I think a pref + warrant deal is more likely with the airlines. On the flip side, there must be some advantages to owning NetJets and major airline. For example a loyalty program that spanned both. Efficiency improvements? Speculating, I don't know enough about the businesses to know if it impact returns. Hmm, is NetJets a success currently? I remember it was not doing great at some point. I think it's too small to be mentioned anymore, so probably we can't know how it is doing. I think it's not mentioned anymore because WEB parroted the excellent management in place at Netjets for years in the annual letters, promising profit was just around the corner until losses mounted and he turfed the CEO. I don't believe it was ever mentioned again after the management transition was announced. Link to comment Share on other sites More sharing options...
whiterose Posted March 18, 2020 Share Posted March 18, 2020 maybe too small, but AER? Link to comment Share on other sites More sharing options...
Castanza Posted March 18, 2020 Share Posted March 18, 2020 So much for the DAL floor at 45 :P Link to comment Share on other sites More sharing options...
longterminvestor Posted March 18, 2020 Share Posted March 18, 2020 Regarding Delta - only spent $45MM on shares at $45. Not the end of the world. I remembered an interview and watched it again for some "words of wisdom" in turbulent times. Quoting his words he was a little early in '08. Not even Warren Buffett can catch "the bottom" however LETS HOPE HE IS WAITING FOR HIS PITCH ON THE BIG BUY!!! Excerpt from Buffett's interview with Andrew Sorkin regarding 2008 financial crisis (https://www.cnbc.com/video/2018/09/10/warren-buffett-talks-to-cnbcs-andrew-sorkin-2008-financial-crisis.html): Sorkin: "When you look back in retrospect, is there any thing you wish you had done that you didn’t do? Any investments that you wish you could have made?" Mr. Buffett: "I can look back on any week and come up with that. The situation, ah, we’d have been better off, considerably better off at Berkshire if we had waited 4 of 5 months to buy anything. I mean, the low was set in March, and it was much lower…I wrote that Op’Ed for the NY Times in late October while it was right on a long term basis but it was way off for 3 or 4..4 or 5 months at least." Link to comment Share on other sites More sharing options...
jhcap Posted March 19, 2020 Share Posted March 19, 2020 What about Petro China - $PTR? He has owned it before and made a lot of money. He has publicly said he would buy it again at the right price. It is both China and energy so the ultimate contrarian bet. Link to comment Share on other sites More sharing options...
Stuart D Posted March 19, 2020 Share Posted March 19, 2020 By my calcs. in 2001 Buffet bought Petro china at a price of: $2.2 (not including leverage) per Barrel of Oil equivalent (proven), or $3.3 (including leverage) per Barrel of Oil equivalent (proven). However, if we take inflation into consideration the 2001 prices equate to the following 2020 prices: $3.49 (no leverage) / BOE proven $5.24 (including leverage) / BOE proven Today's prices are very similar: $2.6 (no leverage) / BOE proven. (cheaper today than 2001) $6.0 (including leverage) / BOE proven. (more expensive today than 2001) note: This is just looking at the price to purchase Petro China's proven reserves. All feedback welcome (the more brutal the better). Keen to learn more about oil companies. Link to comment Share on other sites More sharing options...
Xerxes Posted March 19, 2020 Share Posted March 19, 2020 He bought Petrochina ahead of an era of unprecedented demand for oil. No such thing today Link to comment Share on other sites More sharing options...
longterminvestor Posted March 20, 2020 Share Posted March 20, 2020 Just saw news that Rent-a-Car company Enterprise is possibly seeking aide from Government. I know Mr. Buffett has coveted that business for a while and could never get owner to sell. That would be a nice buy. Large, private, and great culture. Link to comment Share on other sites More sharing options...
Guest longinvestor Posted March 20, 2020 Share Posted March 20, 2020 The mother lode of capital allocation opportunity is likely going to be in the insurance segment. Lots of the "idiot capital" that went into it over the past decade will be shown up; the longer this crisis takes to blow over, the surer it becomes. As close to the center of the circle center of competence for Berkshire as it can get! Link to comment Share on other sites More sharing options...
longterminvestor Posted March 20, 2020 Share Posted March 20, 2020 Regarding a Boeing pref shares deal or complete take over, wouldnt Berk have to sell the airline stocks in that event? Mr. Buffett is not a fan of conflicts of interest. Owning Boeing and the airline customers would be difficult. Link to comment Share on other sites More sharing options...
rb Posted March 20, 2020 Share Posted March 20, 2020 I don't think there will be deals. Government money will have significantly better terms than a Warren deal. Prices haven't even come down that much either. You take todays prices, add a control premium and the valuation sucks. If he didn't do the deal 1 or 2 yeas ago why would he do it now? I think we'll see an expanded equity portfolio. The old man is probably buying bank stocks like crazy. And why not? The equity deals you can get right now are better than the deals you would get on the private market. Link to comment Share on other sites More sharing options...
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