Author Topic: Are you a Berkshire Hathaway Inc. investor?  (Read 4512 times)

John Hjorth

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Re: Are you a Berkshire Hathaway Inc. investor?
« Reply #10 on: January 10, 2019, 07:22:57 AM »
Welcome to you here on CoBF, TB!
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rkbabang

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Re: Are you a Berkshire Hathaway Inc. investor?
« Reply #11 on: January 10, 2019, 07:34:38 AM »
I agree with Viking that the risk is WEB age. I think the company will be differently run after he is gone. Headquarters will become bigger, because nobody can fill WEb role as a CEO if the holding with such minimal staff and ensure compliance. There is a risk that the culture will change for the worse. I could see BRK getting broken into three pieces (Insurance, Utilities, Industry), but that may not be easy, because the Insurance subs own shares in the other parts as well as the holding company and it may not be able to get the stakes consolidated. BRK is huge and May becoming too large to control for a new CEO. I am in the 5-10% bucket and wouldn’t go higher than 25%. There is always systemic risk that someone, somewhere does something and affects the whole company.

I am slightly under 5% for the reasons you and LC have articulated.  I wonder if when WEB retires or can otherwise no longer be CEO what will happen in the short term to the price?  Will there be panic selling?   At the right price I'd increase my position, but probably not higher than 10-15% unless the price was really crazy low.

Gregmal

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Re: Are you a Berkshire Hathaway Inc. investor?
« Reply #12 on: January 10, 2019, 07:36:24 AM »
After much thought, over quite a long time, I purchased a small position today. To me, the key man risks are outweighed by the sheer quantity of great businesses that run independently, and will IMO eventually be spun off. BRK trades at a discount to these, and IMO the current price, is kind of at the upper end of the "cheap" range. Not slam dunk, but with an IB account, only having to put up ~20% of capital in a margin account, it should either outperform the carry cost, or keep dropping, which will further skew my future expected returns and allow me to add into it with greater size.

Jurgis

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Re: Are you a Berkshire Hathaway Inc. investor?
« Reply #13 on: January 10, 2019, 07:40:40 AM »
I am firmly in the camp of Buffett-key-man-risk. Looking at Munger though, we can possibly expect another 7 years +/- couple of Buffett. And the company won't deteriorate immediately after Buffett dies, so it is still investable IMVHO.
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Liberty

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Re: Are you a Berkshire Hathaway Inc. investor?
« Reply #14 on: January 10, 2019, 07:43:27 AM »
I don't own any, but I manage my wife's account, and she owns some.
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John Hjorth

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Re: Are you a Berkshire Hathaway Inc. investor?
« Reply #15 on: January 10, 2019, 07:46:50 AM »
John,

What a great idea for a poll! I am really top heavy, 70%, compared to everyone else. The majority of the rest of my portfolio is BK, WFC, and BAC.

With Warren and Charlie gone, BRKB is still going to be generating great cash flow. I am not worried. Paying a large dividend, selling off parts, etc. will just increase the value--at least short term.

Mike

Thank you Mike! [ : - ) ]

- - - o 0 o - - -

Here, I'm adding a few personal thoughts - unordered, phrased short:

1. I always appreciate reading your posts, Mike. Thank you for sharing.
2. Spekulatius' concerns should not be disregarded. Doing so would be unwise. The risk is real. However, it's doable.
3. If Berkshire is broken up/starts fading/loosing its marbles, we'll leave it, seeking greener grass for our herd, whispering : "What a ride we had!"
4. This poll has been on my mind for years. Finally got my act together.
5. I'm surprised about how heavy the board in general is on Berkshire. I already knew about a few you, though - through your posts.
6. Asking about absolute capital allocation is perhaps not good form, ref. Sleepydragon. The short answer is: "A lot!" [ : - ) ]
« Last Edit: January 10, 2019, 08:02:29 AM by John Hjorth »
”In the race of excellence … there is no finish line.”
-HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai

SmoothSailor

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Re: Are you a Berkshire Hathaway Inc. investor?
« Reply #16 on: January 10, 2019, 08:00:15 AM »
Have a tiny position that I bought in 2014 to attend the annual meeting, been holding since

John Hjorth

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Re: Are you a Berkshire Hathaway Inc. investor?
« Reply #17 on: January 10, 2019, 08:14:55 AM »
At 92 votes, I'm still the lonely guy in the 40 - 35 bracket, that nobody wants to play with. And I'm a chicken. -Mike, this better go well!
”In the race of excellence … there is no finish line.”
-HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai

boilermaker75

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Re: Are you a Berkshire Hathaway Inc. investor?
« Reply #18 on: January 10, 2019, 08:21:53 AM »
I agree, I rather see share buybacks than a dividend as long as the buybacks are below IV.

WEB has already said he prefers share buyback to paying dividends. I also prefer this as it increases the value to continuing share holders. Furthermore there was a shareholder vote sometime back where 98%+ of all shareholders voted not to have a dividend

John,

What a great idea for a poll! I am really top heavy, 70%, compared to everyone else. The majority of the rest of my portfolio is BK, WFC, and BAC.

With Warren and Charlie gone, BRKB is still going to be generating great cash flow. I am not worried. Paying a large dividend, selling off parts, etc. will just increase the value--at least short term.

Mike

boilermaker75

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Re: Are you a Berkshire Hathaway Inc. investor?
« Reply #19 on: January 10, 2019, 08:31:07 AM »
At 92 votes, I'm still the lonely guy in the 40 - 35 bracket, that nobody wants to play with. And I'm a chicken. -Mike, this better go well!

John, Yes, it better go well for us! Owning BRKB is like owning stock in 75 different companies. We are well diversified by owning BRKB. Better yet, BRKB will do better in any downturn than any set of 75 companies. And you only need 15 to get rid of most of the unsystematic risk. -Mike

PS Yes I know with it all under one umbrella there is a risk. But at least while Buffett is still around I am not worried about that risk.