BRK Q1, 2012 BV

[twacowfca]

BRK's 2012 10Q1 reports BV is $175,997B up from $164,850B EOY  :)

[racemize]

I've got it at 109k per A share and 72.69 per B share.  1.1x values are 199,900 and 79.95 respectively.

[twacowfca]

I've got it at 109k per A share and 72.69 per B share.  1.1x values are 199,900 and 79.95 respectively.

 

Did you add in the noncontrolling interests?  Or just the NAV per BRK shareholders?

[Valuebo]

Quite sure he added the noncontr interests too. Without BV per A share is something of $106,650. Could be $107,000 now which makes buybacks possible from +- $118,000 and lower!

 

I've seen a post about being 50 and even 90% in cash. Guess it's a preference but I'd at least put a part of it in BRK at current prices. 90% cash rarely makes sense and even when it does your timing could be of a couple of years in the worst case. With BRK you get the upside to IV if we don't get a crash and in the worst case you sell at a 20-30% loss only to pick up lesser quality that will multiple your money over time!

[racemize]

I've got it at 109k per A share and 72.69 per B share.  1.1x values are 199,900 and 79.95 respectively.

 

Did you add in the noncontrolling interests?  Or just the NAV per BRK shareholders?

 

I may have messed it up, I did it really fast at the time.  I think I included noncontrolling interests.

[roundball100]

I guess the multiplication by 1500 gives 119,925.

 

-pvo

 

[twacowfca]

Quite sure he added the noncontr interests too. Without BV per A share is something of $106,650. Could be $107,000 now which makes buybacks possible from +- $118,000 and lower!

 

I've seen a post about being 50 and even 90% in cash. Guess it's a preference but I'd at least put a part of it in BRK at current prices. 90% cash rarely makes sense and even when it does your timing could be of a couple of years in the worst case. With BRK you get the upside to IV if we don't get a crash and in the worst case you sell at a 20-30% loss only to pick up lesser quality that will multiple your money over time!

 

I think that's right.  BRK closed about 3% above the threshold for "aggressive" buybacks.  That's not a guaranteed floor, but close.  If the market got ugly, it might take a little while to get back to 110% of BV, but probably not too long. 

 

BRK's future downside volatility at this price is likely about as low as any stock could be.  Why wouldn't any fund manager with or without a value bent want to own as much of BRK as possible?

[woltac]

If buying under 1.1 times book is important to you, sell the Dec12 $80 puts at $4.30 (Friday's close) and either have BRKB put to you at a cost of $76.64 or earn 9.6% annualized on the money you tie up until December. 

 

Not a bad result either way.  Of course if BRKB is substantially below $76.64 or substantially above $85.24 you will not be a happy camper.  Crystal ball anyone?

 

[valueinvesting101]

Seems to be trading very close or may be below 1.1x book value.

[zarley]

Seems to be trading very close or may be below 1.1x book value.

 

BRK.a buyback at around 117,260 with price at 119,750  (~2% above buyback)

I've got the BRK.b buyback price at around $78.17, so it's a little bit above that right now at $79.25 (~1.4% above buyback).

 

Q1 BRK shareholder equity = 175,997

A equivalent shares = 1.651

BV/A share = $106,600

BV/B share = $71.07

 

BV/A * 1.1 = $117,260

BV/B * 1.1 = $78.17

 

While I don't think the estimated buyback price is a real floor (Buffett isn't obligated to buy), I don't really see it getting significantly below that level.  I agree that the potential downside is somewhat limited at this point.  A market meltdown and/or significant economic downturn would shrink BV, so it's not really a one-way ticket to the upside.  But, I'd expect BRK to fare better than most in that kind of scenario.

 

I added a small amount to BRK this morning.

[Mephistopheles]

Quite sure he added the noncontr interests too. Without BV per A share is something of $106,650. Could be $107,000 now which makes buybacks possible from +- $118,000 and lower!

 

I've seen a post about being 50 and even 90% in cash. Guess it's a preference but I'd at least put a part of it in BRK at current prices. 90% cash rarely makes sense and even when it does your timing could be of a couple of years in the worst case. With BRK you get the upside to IV if we don't get a crash and in the worst case you sell at a 20-30% loss only to pick up lesser quality that will multiple your money over time!

 

Does the 1.1x cutoff include the noncontrolling interests or no? I would think not, but I'm no expert.