Money and Finance
- Fairholme Proposes To Buy Insurance Businesses Of Fannie, Freddie
UPDATE: Bruce Berkowitz was on CNBC discussing this HERE. Thanks to Will for passing this along. (Reuters) - Fairholme Capital Management has proposed to buy the insurance businesses of Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB), a move...
- Warren Buffett's 2012 Shareholder Letter
Link to: Warren Buffett's 2012 Letter to the Shareholders ………. Excerpts: Intrinsic Business Value As much as Charlie and I talk about intrinsic business value, we cannot tell you precisely what that number is for Berkshire shares (or, for that...
- Berkshire Hathaway Buys Back $1.2 Billion Of Class A Stock
With the share repurchase ceiling increased to 120% of book value, Berkshire can now buy back A shares up to a little over $134,000 per share, and B shares up to a little over $89 per share. Berkshire Hathaway Inc (BRK-A) spent $1.2 billion buying back...
- So, What's Berkshire Worth Anyway?
It seems to be pretty clear to most value investors that Berkshire Hathaway is a bargain. But, how big of a bargain is it and how much can we expect to make over the next few years by purchasing a stake in Warren Buffett's masterpiece today? I view...
- Markel Brunch Notes
I spend most of my time in investing looking for excellent dividend growth opportunities. However, there are two exceptions to this. One is Berkshire Hathaway, why should investors want a dividend from a company that has Warren and Charlie reinvesting...
Money and Finance
Wanted: Castles, Gold and Benevolent Rulers
Interview With Gifford Combs, Managing director and portfolio manager, Dalton Investments
Q: Given that context, where are you focused?
Berkshire Hathaway [ticker: BRK.A]. Think of it as the Rodney Dangerfield of companies in America.
The operating businesses are a superb collection that earn more than 25% on tangible net worth. They should be valued at 20 times earnings, or about $70 billion. I value the finance and utility businesses at 1½ times book value -- together they are worth about $26 billion.
The majority of the value at Berkshire is in the insurance entities, which hold virtually all of the investments. The insurance business depends upon the value one places on the $58 billion of "float," which are the non-interest-bearing liabilities of the insurance companies. Adjusting for the float and making allowances for deferred taxes, I value the insurance companies at nearly $200 billion. The total comes to more than $290 billion, or about $190,000 per share. More conservative assumptions about investment returns over time would lower that value; but it's hard to get to a number much below $150,000 per share.
Q: Given that context, where are you focused?
Berkshire Hathaway [ticker: BRK.A]. Think of it as the Rodney Dangerfield of companies in America.
The operating businesses are a superb collection that earn more than 25% on tangible net worth. They should be valued at 20 times earnings, or about $70 billion. I value the finance and utility businesses at 1½ times book value -- together they are worth about $26 billion.
The majority of the value at Berkshire is in the insurance entities, which hold virtually all of the investments. The insurance business depends upon the value one places on the $58 billion of "float," which are the non-interest-bearing liabilities of the insurance companies. Adjusting for the float and making allowances for deferred taxes, I value the insurance companies at nearly $200 billion. The total comes to more than $290 billion, or about $190,000 per share. More conservative assumptions about investment returns over time would lower that value; but it's hard to get to a number much below $150,000 per share.
- Fairholme Proposes To Buy Insurance Businesses Of Fannie, Freddie
UPDATE: Bruce Berkowitz was on CNBC discussing this HERE. Thanks to Will for passing this along. (Reuters) - Fairholme Capital Management has proposed to buy the insurance businesses of Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB), a move...
- Warren Buffett's 2012 Shareholder Letter
Link to: Warren Buffett's 2012 Letter to the Shareholders ………. Excerpts: Intrinsic Business Value As much as Charlie and I talk about intrinsic business value, we cannot tell you precisely what that number is for Berkshire shares (or, for that...
- Berkshire Hathaway Buys Back $1.2 Billion Of Class A Stock
With the share repurchase ceiling increased to 120% of book value, Berkshire can now buy back A shares up to a little over $134,000 per share, and B shares up to a little over $89 per share. Berkshire Hathaway Inc (BRK-A) spent $1.2 billion buying back...
- So, What's Berkshire Worth Anyway?
It seems to be pretty clear to most value investors that Berkshire Hathaway is a bargain. But, how big of a bargain is it and how much can we expect to make over the next few years by purchasing a stake in Warren Buffett's masterpiece today? I view...
- Markel Brunch Notes
I spend most of my time in investing looking for excellent dividend growth opportunities. However, there are two exceptions to this. One is Berkshire Hathaway, why should investors want a dividend from a company that has Warren and Charlie reinvesting...