Author Topic: Buffett buybacks: Could Berkshire tender stock?  (Read 55761 times)

John Hjorth

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Re: Buffett buybacks: Could Berkshire tender stock?
« Reply #320 on: January 09, 2019, 11:26:48 AM »

More data! [and a bit less talk ...]:

Estimated Berkshire selfimposed acquisition capacity EOP 2018Q3 per company for AAPL and the US banks [ranked]:

AAPL : USD 50,053 M
JPM   : USD 33,438 M
GS    : USD   4,129 M
BAC  : USD   2,329 M
USB  : USD   1,293 M
BK    : USD      891 M

- - - o 0 o - -

BRK maximum volume based buybacks at price ceiling 208 [<- known for 2018Q3] for period October 1st - December 14th 2018 - a material part of 2018Q4 : USD 5,454 M.

- - - o 0 o - - -

Calculation attached.

Bumping this up by quoting, with attachment!

- - - o 0 o - - -

Anybody of my fellow board members willing to take firm, unconditional & binding  WAG [<- learned that expression from longinvestor! [ : - D ]] stab at:

  • Berkshire portfolio material [quantified by name] additions [net] in 2018Q4,
  • Berkshire buybacks in 2018Q4, measured in USD B, &
  • Berkshire liquidity EOP 2018Q4 [Total cash plus US T-Bills]
? [ : - ) ]
« Last Edit: January 09, 2019, 11:38:11 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


gfp

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Re: Buffett buybacks: Could Berkshire tender stock?
« Reply #321 on: January 10, 2019, 10:47:22 AM »
Just a quick update that I did the math on Berkshire's approximate Apple cost basis as of end of Q3 2018.  I know you did the same, John, but I couldn't really see an exact number in your spread sheet.  Maybe I am reading it wrong.

Anyway, here is the last know Apple position at Berkshire and it's cost basis:

255.16 million shares, total cost basis of $36.209 Billion, for an average cost basis of 141.91 / share.

This excludes pension fund holdings.

The first 166.713 million shares were disclosed in the AR as having a 125.73 / share average cost.

*** edit: this is kind of funny since the low from 1/3/2019 was $142/share. ***

Getting back to the Apple discussion - I concur with Stubble. Putting such a huge % of BRK's market cap into Apple bothered me from the start. I hope he's done adding. I rarely question Buffett's purchases but the bear case here is worrisome.

I've been trying to find BRK's ( most recent) cost basis in Apple. Does anyone have it?
« Last Edit: January 10, 2019, 10:53:22 AM by globalfinancepartners »

SwedishValue

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Re: Buffett buybacks: Could Berkshire tender stock?
« Reply #322 on: January 10, 2019, 11:23:13 AM »
One would have to assume that Apple is worth more now than when Buffett initially bought his stock. It's not like they've been breaking even.

For what it's worth, I'm surprised that Berkshire has underperformed Apple AND DAL since they had their profit warnings. I guess the market has its ways.

John Hjorth

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Re: Buffett buybacks: Could Berkshire tender stock?
« Reply #323 on: January 11, 2019, 01:54:16 PM »
I'm sorry for an unclear post above of mine, globalfinancepartners,

It's about my try to reverse engineer Berkshire's Apple position. To do it I had to make additional assumptions to try to triangulate it. The difference to the reverse engineering of Berkshire buybacks is we have an "extra" fixpoint based in the information in the 10-Qs about buybacks and a reasonable assumption [you did it, and what you proposed made perfect sense to me] how the buy order to the broker is bolted together.

That fixpoint we don't have for the Apple position [quarterly]. So it would be pure guesswork based on my own speculations, and what may come out of the Excel crushing the numbers would most likely be a self-fulfilling prophecy. In short, I would just be fooling myself. So I didn't try to proceed with the calculations. Also, I hope my fellow board members got a good laugh of this brainfart of mine! [ : - ) ]

Also - and especially - the fact that aws has expressed a variant expectation to mine, which is as good as mine, gave me confirmation that doing the calculations was a no-go. Better to wait to mid February to see the size of the Apple position EOP 2018Q4 and the cost of it at a later moment in the Berkshire 2018 10-K.

That said, rough estimates of the cost of the additions to the Apple position for the first 3 quarters of 2018 can still be done now, yes.
« Last Edit: January 11, 2019, 02:04:10 PM 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