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Posted
Operating earnings' data-ipsquote-timestamp=' which exclude some investment results, were $1,615 a share, missing the average $1,780 estimate of three analysts surveyed by Bloomberg.[/quote']

 

Berkshire misses earnings estimates. 

 

Operating results were very good.  If you look at year over year pre-tax earnings by listed segment they were all up strongly (BNSF +15%, Marmon +21% McLane +24%, MidAmerican +7%).  Lubrizol is lumped in 'other' so that isn't a fair comparison, but operating earnings were very good for the quarter.  After a quick read, it's hard to see how this was anything but a very good quarter for BRK.

Posted

So Berkshire trades at 1.14x book value. What is the motivation to buy a generic P&C insurer which largely is a bet on a bond portfolio for the same multiples(1.1-1.2x BV) when you could be getting the ROEs off of Berkshire's great businesses and capital allocation across the investment landscape on all incremental capital generated.

Posted

So Berkshire trades at 1.14x book value. What is the motivation to buy a generic P&C insurer which largely is a bet on a bond portfolio for the same multiples(1.1-1.2x BV) when you could be getting the ROEs off of Berkshire's great businesses and capital allocation across the investment landscape on all incremental capital generated.

 

I used to hold a fair amount of insurance companies and a big part of the thesis consisted of underlevered balance sheets, unused capacity, and aggressive buybacks (AFG, HCC, TRV). The trade-off is increasing yield piggishness.

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