Jump to content

Various Buffett Comments


Parsad
 Share

Recommended Posts

Here are a few articles discussing Buffett's comments today:

 

In regards to the recent drop in price of BAC shares:

 

http://finance.yahoo.com/news/Exclusive-Buffett-not-worried-rb-69698888.html?x=0&.v=3

 

On the buyback being the equivalent of buying dollar bills for 90 cents:

 

http://www.bloomberg.com/news/2011-10-04/buffett-likens-buyback-to-getting-dollar-bills-for-90-cents.html

 

On real estate:

 

http://www.bloomberg.com/news/2011-10-04/buffett-s-homeservices-of-america-buys-alabama-real-estate-firm.html

 

Cheers!

Link to comment
Share on other sites

Oct 4, 2011

 

“If I can buy dollar bills for 90 cents, I’ll buy them,” Buffett, 81, said today at Fortune magazine’s Most Powerful Women conference in Laguna Niguel, California. “I want to warn the people that are selling to me that I believe I am buying their dollar bills for 90 cents.”

 

When I read this, it seemed rather peculiar that Warren would even consider buying dollars for 90 cents. Buying anything close to full intrinsic value leaves very very little room for error or margin of safety. So, he must be just saying it that way as to not tip his hand to reveal the true intrinsic value of Berkshire Hathaway, which is probably more like in the $150 range for the BRK.B

 

Buffett has explaned this. He would buy $1 for 90 cents if he was certain of the value of the $1. MOS is a direct correlation to Certainty.

Link to comment
Share on other sites

Oct 4, 2011

 

“If I can buy dollar bills for 90 cents, I’ll buy them,” Buffett, 81, said today at Fortune magazine’s Most Powerful Women conference in Laguna Niguel, California. “I want to warn the people that are selling to me that I believe I am buying their dollar bills for 90 cents.”

 

When I read this, it seemed rather peculiar that Warren would even consider buying dollars for 90 cents. Buying anything close to full intrinsic value leaves very very little room for error or margin of safety. So, he must be just saying it that way as to not tip his hand to reveal the true intrinsic value of Berkshire Hathaway, which is probably more like in the $150 range for the BRK.B

 

Hi Ben Graham,

 

I read it differently.  I read it as he is buying the value of something that today presently is worth $1.00 for 90 cents.  And obviously, that item at $1.00 will grow at a certain value for the next 20, 30, 40 years. 

 

Basically, he was saying that the sum of the parts or liquidation value (book value, minus any goodwill or intangibles, plus the fair value of those businesses if sold) is worth more than the 90 cents he is paying...let alone what the intrinsic value would be if you include the cash that those businesses would generate or the use of float.  Cheers!

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
 Share

×
×
  • Create New...