A valuation of Berkshire Hathaway. The stock has been good to me. I learned a ton from Buffett & Munger, but the current valuation lowers prospective returns.
Hello friend, I just have a question why you value all insurance businesses at 20B, I understand your thinking stating that 2B underwriting profit would be the average, but from the 2023 annual report insurance had 263B in revenue and 228B in expenses, wouldnt make sense that those 35B in EBIT, apply a multiple of 10X, or I am loosing the point here?, I was looking at progressive and that where the median value has been, thanks for the clarification, and keep the good work
This article gets me thinking to sell a part of my Berkshire Hathaway as well... I'm doubting that it'll increase as much in the upcoming years as it did in the past.
I think your position is just fine for now. Let's discuss your position in a phone call 😉
Greg Abel has been great in building Berkshire Hathaway Energy. I don't know about experience outside that. Hope he will not suffer from the man with the hammer syndrome.
Hello friend, I just have a question why you value all insurance businesses at 20B, I understand your thinking stating that 2B underwriting profit would be the average, but from the 2023 annual report insurance had 263B in revenue and 228B in expenses, wouldnt make sense that those 35B in EBIT, apply a multiple of 10X, or I am loosing the point here?, I was looking at progressive and that where the median value has been, thanks for the clarification, and keep the good work
I value the underwriting profit at $20B and the float generated by the insurance business at $168B.
In the 35B you mention are also earnings from other assets like the bond/equity portfolio (which I value separately).
Berkshire insurance is a lot more than car insurance and a one year pe multiple does not do it justice.
Thanks, indeed I wasn’t taking into account that those were also the equity/bond returns, thanks!
This article gets me thinking to sell a part of my Berkshire Hathaway as well... I'm doubting that it'll increase as much in the upcoming years as it did in the past.
What's your opinion on Greg Abel?
I think your position is just fine for now. Let's discuss your position in a phone call 😉
Greg Abel has been great in building Berkshire Hathaway Energy. I don't know about experience outside that. Hope he will not suffer from the man with the hammer syndrome.