BRK End of Year Book Value Per Share ?

[twacowfca]

 

 

Just ran some year end values and estimates through my head.  I think EOY BV/SH is up about 1 1/2 % over Q3 BV/SH. Interestingly, BRK's gains on their BAC warrants may just about offset their losses from Hurricane Sandy. :)

 

Interestingly, BRK's share buybacks appeared to kick in in the low $89 range untill the S&P dropped somewhat during the last few days.  Repurchases may have beem made slightly lower in the mid $88 range yesterday and today until the market bounced this afternoon.  I estimate that 120% of BRK's book value per share may have dropped less than one percent below the Q3 value until the final bounce in the S&P 500 brought 120% of BRK's BV/SH back above the Q3 value.

 

Why is this important? 120% of the EOY BV/SH should be the new quasi strike price on the so called Buffett Put.  :)

[twacowfca]

 

 

Just ran some year end values and estimates through my head.  I think EOY BV/SH is up about 1 1/2 % over Q3 BV/SH. Interestingly, BRK's gains on their BAC warrants may just about offset their losses from Hurricane Sandy. :)

 

Interestingly, BRK's share buybacks appeared to kick in in the low $89 range untill the S&P dropped somewhat during the last few days.  Repurchases may have beem made slightly lower in the mid $88 range yesterday and today until the market bounced this afternoon.  I estimate that 120% of BRK's book value per share may have dropped less than one percent below the Q3 value until the final bounce in the S&P 500 brought 120% of BRK's BV/SH back above the Q3 value.

 

Why is this important? 120% of the EOY BV/SH should be the new quasi strike price on the so called Buffett Put.  :)

 

 

Meyer Shields, Stifel Nicolaus analyst estimates BRK B's EOY 120% of book value is $90.86.

[onyx1]

Gary Ramsom of Dowling & Partners (one of the insurance experts WEB picked last year to ask questions at the ASM) estimated year end BV of $75.97.  120% is $91.16.  Note that his estimate was on November 29 and we saw a meaningful improvement in general equity valuation in December, including a move in BAC from $9.8 to $11.6.  December's BAC movement alone might be worth $0.33/share after tax.

[twacowfca]

Gary Ramsom of Dowling & Partners (one of the insurance experts WEB picked last year to ask questions at the ASM) estimated year end BV of $75.97.  120% is $91.16.  Note that his estimate was on November 29 and we saw a meaningful improvement in general equity valuation in December, including a move in BAC from $9.8 to $11.6.  December's BAC movement alone might be worth $0.33/share after tax.

 

That's interesting. I wonder if he allowed anything for Sandy losses?  Today's surge in the market should conservatively take instantaneous BV/SH to about $91.50, or perhaps higher by Ramsom's methodology.

 

This is interesting as we bought a lot of short term BRK calls last week that are up double or triple what we paid for them.  :)

[onyx1]

Gary Ramsom of Dowling & Partners (one of the insurance experts WEB picked last year to ask questions at the ASM) estimated year end BV of $75.97.  120% is $91.16.  Note that his estimate was on November 29 and we saw a meaningful improvement in general equity valuation in December, including a move in BAC from $9.8 to $11.6.  December's BAC movement alone might be worth $0.33/share after tax.

 

That's interesting. I wonder if he allowed anything for Sandy losses?  Today's surge in the market should conservatively take instantaneous BV/SH to about $91.50, or perhaps higher by Ramsom's methodology.

 

This is interesting as we bought a lot of short term BRK calls last week that are up double or triple what we paid for them.  :)

Their BRK guesstimate is 3.8% of $20bln in Sandy losses, or $750mm.  But they expect late development to bring losses to a level higher than first estimates, and are assuing flooding caused a higher mix of commercial losses vs auto/home.

 

BTW, I fat fingered his name, it's spelled Ransom.

[onyx1]

Dowling & Parntners upped their estimate of BRK Sandy losses to $1.4bln this morning and now believe 2012 YE BV will be $75.44/share, 120% of that BV is $90.53/share.  With the B shares trading above the "floor" I don't see shares being purchased, which works just fine for me.

[twacowfca]

Dowling & Parntners upped their estimate of BRK Sandy losses to $1.4bln this morning and now believe 2012 YE BV will be $75.44/share, 120% of that BV is $90.53/share.  With the B shares trading above the "floor" I don't see shares being purchased, which works just fine for me.

 

The $1.4B for Sandy losses looks about right.  That's a lot more realistic than some other estimates.  What's Dowling allowing for index derivatives changes?

 

I agree that the recent bounce and resulting updraft may make the 120% of book floor less important.  :)