Author Topic: Buffett buybacks: Could Berkshire tender stock?  (Read 147539 times)

The Investor

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Re: Buffett buybacks: Could Berkshire tender stock?
« Reply #180 on: November 02, 2018, 05:54:16 PM »
My default position is to always agree with Buffett

Same here, although I like to understand why an investment makes sense. I don't really understand Teva for example, so I haven't invested. Other than indirectly through owning Berkshire that is  ;)


SwedishValue

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Re: Buffett buybacks: Could Berkshire tender stock?
« Reply #181 on: November 03, 2018, 05:13:04 AM »
It's out.

http://www.berkshirehathaway.com/qtrly/3rdqtr18.pdf

Buybacks have been less significant than I thought. If I read things correctly, 2 805 A-share equivalents have been bought back in August and September (around 840 Million USD). For October until the 25th, there has been an equivalent of 588.4 A-shares bought back. The neat total so far is that Berkshire bought back stock for approximately one billion USD.

longinvestor

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Re: Buffett buybacks: Could Berkshire tender stock?
« Reply #182 on: November 03, 2018, 05:18:38 AM »
Earnings explosion continue

gfp

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Re: Buffett buybacks: Could Berkshire tender stock?
« Reply #183 on: November 03, 2018, 06:26:24 AM »
So the way I read it is that they were only active for 14 trading days during the quarter: August 7th - August 24th, from which you can estimate the cap price in their repurchase instructions.  During those 14 trading days they repurchased approximately $927.566 million worth of stock, for an average of about $66.25 million worth per trading day.

No further repurchase activity during the quarter.

Then, subsequent to quarter end, up until October 25th, they were back in the market, repurchasing approximately $181 million worth of stock in 8 trading days, for an average of about $22.625 million worth of stock per day.  This is consistent with the estimated cap price that can be divined by the August repurchase activity.

They did not repurchase anything the first day the were allowed to, August 6th, probably because they had a one day delay starting trading on the 10b5-1 plan I assume they are using.


It's out.

http://www.berkshirehathaway.com/qtrly/3rdqtr18.pdf

Buybacks have been less significant than I thought. If I read things correctly, 2 805 A-share equivalents have been bought back in August and September (around 840 Million USD). For October until the 25th, there has been an equivalent of 588.4 A-shares bought back. The neat total so far is that Berkshire bought back stock for approximately one billion USD.

AdjustedEarnings

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Re: Buffett buybacks: Could Berkshire tender stock?
« Reply #184 on: November 03, 2018, 06:28:18 AM »
It's out.

http://www.berkshirehathaway.com/qtrly/3rdqtr18.pdf

Buybacks have been less significant than I thought. If I read things correctly, 2 805 A-share equivalents have been bought back in August and September (around 840 Million USD). For October until the 25th, there has been an equivalent of 588.4 A-shares bought back. The neat total so far is that Berkshire bought back stock for approximately one billion USD.

I have a slightly different number, but similar conclusion to you. Total B-equivalents of 4,476,692 repurchased for $928 million during the quarter, for an average price of $207.2. I'm not sure where you are seeing the October numbers. It seems you are drawing conclusions from the reported share-count at Oct 25? I think that's reasonable, but there could easily be other factors that affect share counts aside from repurchases, as there were this quarter as well. Buyback was a little underwhelming. The rest of the earnings are rather good though. So good report overall, IMO.
« Last Edit: November 03, 2018, 06:34:33 AM by AdjustedEarnings »

gfp

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Re: Buffett buybacks: Could Berkshire tender stock?
« Reply #185 on: November 03, 2018, 06:34:05 AM »
The october repurchase activity can be estimated by using the 10/25 share counts, accounting for A to B conversions, and estimating the "missing" shares.  It won't be spot on, because like you mention there are other factors that effect share count, but when there is a reduction in the number of outstanding shares we can safely assume that is from net share repurchases.  All the other factors that effect share count would generally lead to small increases in share count.

It's out.

http://www.berkshirehathaway.com/qtrly/3rdqtr18.pdf

Buybacks have been less significant than I thought. If I read things correctly, 2 805 A-share equivalents have been bought back in August and September (around 840 Million USD). For October until the 25th, there has been an equivalent of 588.4 A-shares bought back. The neat total so far is that Berkshire bought back stock for approximately one billion USD.

I have a slightly different number, but similar conclusion to you. Total B-equivalents of 4,476,692 repurchased for $928 million during the quarter, for an average price of $207.3. I'm not sure where you are seeing the October numbers. It seems you are drawing conclusions from the reported share-count at Oct 25? I think that's reasonable, but there could easily be other factors that affect share counts aside from repurchases, as there were this quarter as well. Buyback was a little underwhelming. The rest of the earnings are rather good though. So good report overall, IMO.

longinvestor

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Re: Buffett buybacks: Could Berkshire tender stock?
« Reply #186 on: November 03, 2018, 06:48:35 AM »
"This is absolutely one of the biggest quarterly earnings reports that has ever come out of a United States corporation," said Bill Smead, chief executive of Smead Capital Management in Seattle, a Berkshire shareholder.

I believe he is talking about the headline number, but is his statement correct?

StubbleJumper

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Re: Buffett buybacks: Could Berkshire tender stock?
« Reply #187 on: November 03, 2018, 06:51:27 AM »
The exact level of buybacks might not be clear, but what is clear is that it amounts to bugger-all in the context of BRK's cash balances.  The finished the quarter with, what, $95 billion in cash and short term investments?  So dropping a bil on buybacks hardly constitutes an aggressive, high conviction move.

I say either get serious about deploying some of that cash on buybacks, or institute a considerable cash dividend.  Buying Apple sharss soaked up some cash, but it really doesnt inspire confidence in management given previous observations about circle of competence.


SJ

ander

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Re: Buffett buybacks: Could Berkshire tender stock?
« Reply #188 on: November 03, 2018, 07:16:14 AM »
I think it’s pretty clear (based on his actions), he thinks the stock is attractively priced relative to other alternatives but not substantially attractive. Seems to me that the change in buyback policy probably made because of the accounting change re: investment treatment as opposed to the stock being significantly undervalued currently.

alwaysinvert

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Re: Buffett buybacks: Could Berkshire tender stock?
« Reply #189 on: November 03, 2018, 07:37:05 AM »
If he doesn't make a sudden surprise tender like I originally speculated (and that's a low probability), it's hard to draw any other conclusions from this than that dividends are way closer than previously suspected. Barring an -08 type drawdown the idle cash will keep growing at a rapid clip. A luxurious problem to have, but these puny buybacks don't even offer a partial solution.