Author Topic: Mystery Berkshire Investment  (Read 42478 times)

Dooba

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Re: Mystery Berkshire Investment
« Reply #10 on: February 09, 2021, 04:30:21 PM »
I agree. I think it would be much more likely to be Facebook, than Google at today's prices. I thought Alphabet was a huge value relative to the rest of the FANG a few years ago when it was trading around $850 and started displaying some value characteristics. To me, it fit into Bufett and Munger's "wonderful company at a reasonable price" mantra given its cash flows, growth profile, and strong moat (although I'm sure Charlie and Warren hate its SBC practices).  I was fortunate to pull the trigger, and was able to add to it at $1100-1200s back, and then again in the $1400-1500s in Aug (making it my largest position and a long term punch card hold).  But at $2100, it's had a really nice run and I frankly hope BRK isn't buying it at these prices. I think Facebook is now looking like Google did a couple years ago (minus the significant moat), and is displaying some value characteristics relative to its growth profile, cash hoard, and free cash flows. I took a position after recent earnings when the stock didn't move. To me, FB is the more reasonable buy at today's prices.
ďI have never seen a management consultantís report in my long life that didnít end with the following paragraph: 'What this situation really needs is more management consulting.' Never once. I always turn to the last page."-Charlie Munger


Dooba

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Re: Mystery Berkshire Investment
« Reply #11 on: February 09, 2021, 04:32:03 PM »
I would also love to see Buffett snap up Markel (trading at 1.2x book right now). That would be a great cannon shot (but doubt it would a minority stake through open mkt purchases).
ďI have never seen a management consultantís report in my long life that didnít end with the following paragraph: 'What this situation really needs is more management consulting.' Never once. I always turn to the last page."-Charlie Munger

CorpRaider

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Re: Mystery Berkshire Investment
« Reply #12 on: February 09, 2021, 04:43:05 PM »
I will struggle with the self-loathing if it's Google.  Markel would be weird, but I could get enthused if he was like we're the biggest holder now, Gayner is 100% in charge.
« Last Edit: February 09, 2021, 04:44:36 PM by CorpRaider »

backtothebeach

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Re: Mystery Berkshire Investment
« Reply #13 on: February 09, 2021, 05:18:09 PM »
Could be COST (Costco) as well. The stock disappeared from the last 13F.


RadMan24

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Re: Mystery Berkshire Investment
« Reply #14 on: February 09, 2021, 05:41:08 PM »
BA

Xerxes

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Re: Mystery Berkshire Investment
« Reply #15 on: February 09, 2021, 06:03:00 PM »
i would be shocked if it was Boeing.

Of all the assets in aerospace that entity is the one you don't want to own. It has the brand, but shareholders will be taking the backseat on that asset for a longggggg while, after being showered by tens billions in the past decade.

Total of $43 billions returned via buyback since 2010.
Total of $25 billions returned as dividend since 2010.

On a cumulative free cash flow of $59 billion since 2010.
Long term debt is up from $9 billion (pre-MAX) to +$60 billion today (yes a whole bunch of its cash on B/S).

Far better, to own tier 1 assets that get their revenues in MRO and Aftermarket, than Boeing which is dependent on production delivery. Aftermarket will recover when the flight returns en masse, production deliveries will still trickle.

Lastly, in this multi-decade zero sum game that is being played between Boeing and Airbus, the former has lost this round big time. I believe the ramification will be multi-decade. As a trade, BA is probably ok, but as a long term pillar of Berkshire, i am not so certain.

RadMan24

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Re: Mystery Berkshire Investment
« Reply #16 on: February 09, 2021, 08:34:24 PM »
i would be shocked if it was Boeing.

Of all the assets in aerospace that entity is the one you don't want to own. It has the brand, but shareholders will be taking the backseat on that asset for a longggggg while, after being showered by tens billions in the past decade.

Total of $43 billions returned via buyback since 2010.
Total of $25 billions returned as dividend since 2010.

On a cumulative free cash flow of $59 billion since 2010.
Long term debt is up from $9 billion (pre-MAX) to +$60 billion today (yes a whole bunch of its cash on B/S).

Far better, to own tier 1 assets that get their revenues in MRO and Aftermarket, than Boeing which is dependent on production delivery. Aftermarket will recover when the flight returns en masse, production deliveries will still trickle.

Lastly, in this multi-decade zero sum game that is being played between Boeing and Airbus, the former has lost this round big time. I believe the ramification will be multi-decade. As a trade, BA is probably ok, but as a long term pillar of Berkshire, i am not so certain.

BA made a mistake, but that doesn't mean its future isn't bright, someone is going to have to build large structures in space some day. Plus, the odds I'm right are basically 1 in 3000.

ValueMaven

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Re: Mystery Berkshire Investment
« Reply #17 on: February 10, 2021, 04:07:15 PM »
Markel is totally random and def not it...

BA is possible.  So is GE and even something in the energy/midstream space

Xerxes

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Re: Mystery Berkshire Investment
« Reply #18 on: February 10, 2021, 05:18:11 PM »
General Electric is far more possible than Boeing, IMHO.

Larry Culp cut his teeth at Danaher and he is well known name.

Its aviation exposure is an actual positive with the recovery in Aftermarket and 737 MAX pulling its weight on production side. Think about it. The bulk of commercial aircraft flying out there either have engines from GE, Pratt & Whitney, Rolls-Royce or Safran. With the first two + Safran dominating the narrow-body market.

Its health care is a positive as well. The big question mark were on its Power division (they wrote off the bad part of Alstom) and GE Capital, the latter is being dismantled completely except for financing that is needed to supports its industrial operations. Its renewables (which i dont know much about) can only be a positive.

In 2012, GE Capital was 31% of revenues now it is less than 10%.
Aviation was 13% of sales in 2012 and now it is 34%. Long term debt has gone down from $220 billion to ~$60 billion.

I think General Electric will rip and will ride the opening economy and rotation to value trade.

 

Xerxes

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Re: Mystery Berkshire Investment
« Reply #19 on: February 10, 2021, 05:22:01 PM »
BA made a mistake, but that doesn't mean its future isn't bright, someone is going to have to build large structures in space some day. Plus, the odds I'm right are basically 1 in 3000.

Agreed.
Don't get be wrong, I believe Boeing is great American icon and will survive and do great things.

It is just that i don't see Buffet being interested in a company where shareholders have to take the back seat to bondholders for time being (counted in years).