Could have something to do with his being a fabulous business analyst?
Would you rather he post nothing at all, or post only about companies for which he is likely less of an expert?
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What about Bloomstran’s fantastical conservative IV value of $406/B share?
He tries to impress with accounting terms and granular details but the fancy analysis is wrong.
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Interesting thing to say, considering that you constantly badger him to post more about Berkshire.
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Most fund managers (Superinvestors) dont want to hold brk because their clients ask “why should I pay fees to you when i can buy Berkshire direct”
Interesting point with Li Lu investing in Brk with Mungers money.
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OK. Where’s your analysis? should be an exciting read.
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Here. is my analysis;. Buy below Book + FLOAT +1/2 deferred taxes and never sell.
Or pay less than peak price of old man.
Bloomstran puts out tombs that amount to false precision.
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As expected, your analysis is laughable.
jk
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Ok read his 306 page tomb.
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He does a good job summarizing the financials. He gets it right when the news articles (and some here) get it wrong, e.g. the “20% increase in profits”.
His IV estimates are very optimistic, bordering on fan-fiction.
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Read it. You called his out. I want to compare it to yours. If the above is an “analysis” then you should begin your next analysis of a business with a dictionary.
jk
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Simplicity is sophistication. Same formula Sandy Gottesman used
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True. But there is a difference between simplicity and complete absence, which you only have demonstrated the latter. I’m comfortable you haven’t done any. I’ll move on now.
jk
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As expected, no business analysis whatsoever. And the word you apparently mean to use is tome.
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Bloomstran makes a model out of criticizing ARK and Cathie Wood. I can’t help but wonder what the hell that’s all about. I think she is autistic and (not relatead to being autistic) also whacko. But is this his job?
Bloomstran needed a cult and he’s successful apparently with his use of Buffett. Is he really a great business analyst? Don’t make me laugh so much I throw up please.
The guy is just another…one of the endless Tilson types looking to sell something and looking for those who will latch on for dear life and never let go.
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Ya’ll are racialist. In Detroit it is tomb
Here are some posters’ comments about Bloomstran’s intrinsic value estimates for Berkshire:
DetroitBadBoy: “fantastical,” “wrong”
AdrianC: “very optimistic, bordering on fan-fiction”
Let’s take a look at the data. In each year back to 2015, Bloomstran has published conservative intrinsic value estimates in his annual letters, using multiple methodologies. He publishes his letters before Berkshire releases its annual results, so his IV estimates are based on his estimate of Berkshire’s annual financial results for the year-end preceding his letters’ publication date.
Of the valuation methods used, he prefers the “Sum of the Parts” and the “GAAP Adjusted Financials” methods. In column 3 below, I used the higher of his two preferred IV estimates. In column 4 below, I used Yahoo! Finance historical stock quotes.
| 1. Semper Augustus Letter Publication Date | 2. Based on Estimated Business Results as of | 3. Higher of Two Preferred IV Estimates per “A” Share | 4. First Date “A” Shares Closed at or Greater Than IV Estimate | 5. Duration Between Publication Date and Price Realization, in Months (column 4 minus column 1) |
|---|---|---|---|---|
| 02/01/2016 | 12/31/2015 | $295,134 | 12/04/2017 | 22 |
| 02/12/2017 | 12/31/2016 | $314,534 | 01/12/2018 | 11 |
| 02/11/2018 | 12/31/2017 | $383,049 | 03/08/2021 | 37 |
| 02/14/2019 | 12/31/2018 | $406,754 | 04/16/2021 | 26 |
| 02/14/2020 | 12/31/2019 | $462,090 | 01/04/2022 | 23 |
| 02/15/2021 | 12/31/2020 | $522,556 | 03/21/2022 | 13 |
| 02/22/2022 | 12/31/2021 | $603,882 | N/A | ??? |
It’s been less than 9 months since his most recent IV estimate, and I’ll grant you, the stock price is currently well short of that estimate. I’d note that many stocks, including Berkshire, are down in recent months. But for the remaining six IV estimates, for which the stock price has always eventually met or exceeded his estimate, it has taken only an average of 22 months for that to occur.
Value Investors Club founder Joel Greenblatt has said, “I actually have taught at Columbia for 23 years and I make a promise to my students first day of class. I promise them if they do good valuation work the market will agree with them. I just never tell them when. Could be a couple of weeks, could be two or three years. But that is the secret. To have a steady disciplined process to value companies and to be confident enough to stick with it when it’s not working in the short term. The market is very emotional in the short term.”
I disagree with the above posters’ characterizations, and I’m quite happy to take Bloomstran’s Berkshire IV estimates and sit on my arse for a couple of years, if that’s all it takes. Life is rarely that easy.
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Agree. I have seen no one more thoughtful wrt Berkshire which he has been following closely since 1999. His annual letter is incredibly thorough and entertaining and his GAAP adjusted earnings approach and valuation methodologies are very thoughtful and reasonable imo.
I really appreciate his selflessness in sharing his comprehensive Semper annual letter. Chris gave a nice talk at the Gabelli conference in Omaha and I chatted with him briefly after the Markel brunch conference at the Marriott. He was most gracious, genuine and entertaining. There was no evidence of self-promotion. His and Markel’s approach to investing certainly resonates with that audience.
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What do you do with his IV estimate? Sell when it is reached?
I think perhaps we’re approaching from opposite ends? I use my own IV estimates to attempt to get good value when I buy.
One other thing, I did read his last letter. I’m not going to go back and get the quote, but I’m pretty sure in one IV estimate he included earnings on cash that he expects to be invested soon. Not interest on the cash, but actual business earnings. That’s the fan-fiction.
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AdrianC, I agree there is a valid argument wrt this cash and other adjustments.The GAAP adjustment treatment of cash is on p.119-120 of the Semper report above. All of the adjustments are subject to some criticism but taken as a whole, they seem pretty thoughtful and reasonable imo, and Chris has followed every facet for 23 years.
Regarding selling, good question. I have just entered entered the soon to draw down phase. I suppose I would consider a trim when we approach a similar 1.55 P/Peak BV as we did in March. I did not trim, as some on this board did, at that time as I was still generating employment income at that time.
Sitting on 2-3 years cash now. Let’s hope that time frame gives us time for the market price to appreciate and reach a similar level. Sitting on some 1/25 DITM LEAPS which I hope may be fruitful. It is strange to try to change from the “when should I buy” to “when should I trim” mode and an attempt to hold myself accountable when the time comes.
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Looks like he sold a big chunk of USB.
Ownership reduced to 53 million shares from 120 million:
https://www.sec.gov/Archives/edgar/data/1067983/000119312522282565/d302279dsc13ga.htm
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