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Berkshire Hathaway Inc. Message Board

  • dmsmithox dmsmithox Feb 24, 2010 11:26 PM Flag

    Stage set for a spectacular short squeeze

    Could happen! If you go back to the T2 Partners analysis circa February 1 and extrapolate a 4th qrtr value per A share of $100,000 in investments......and operating earnings come in at $5000+/- per share with a conservative 8 mark and bingo...you get an intrinsic value of $140,000 per A share or $93.33 per B share.
    If you look at a chart, there really isn't much stock(resistance) until you are in the high 130's. Even if there are no additional positive surprises in WEB letter Saturday morning and there may well be...this thing could gap open Monday morning and make a breathtaking run to $90 on the B shares in a few days.............make a real mess of the shorties!

    Any other best quesses on the operating earnings and investment values?

    DMS

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • In response to this excellent post and to others that are less well informed: To state that you think BRK-B's true intrinsic valuation is around 100.00 is no stretch and in fact a very credible "target". If anyone has actually done the homework and formulated the value for themselves (buy a book, learn how to do it) you'll find an amount right around 100. My appraisal puts B at 110-115 actually. Also- while paying attention to credible analysts, you'll see those folks looking at 100 also. Whitney Tilson comes immediately to mind. No matter how you slice it B is in fact on sale right now at a 20-25% discount. This is supported as well by A's true value.

      Great original post.

    • I like your analysis DMS. at least you add something constuctive to the conversation.

      • 1 Reply to truckrp97
      • Thank you truckrp......as you can tell by my other posts, I am neither pumping nor bashing...merely calling attention to a set of circumstances, a confluence of factors if you will, that could lead to a significant upside move.....
        BRK by any historical and/or rational measure is trading well below it's intrinsic value. There have been periods in the past where this has been evident, but not many and not for long.
        It has always reverted to the mean.

        The share split and S&P addition have the net effect of increasing demand dramatically....for example, there are something like 12,000 mutual funds, most of which have not had a BRK component up to this point because of the share price and liquidity issue. Thesefunds are not in the game yet...they are your future buyers and they will have, perhaps not as long a time horizon as most of us (I have been a BRK s/h for 12 years)but will not be in and out guys either.
        For this and other reasons on the supply side, this stock is still thin, and I think will remain so until much higher levels....maybe indefintely.
        Information is carefully metered out and guidance non existent (as it should be).
        Big results, good and bad, will lead to exaggerated moves in the stock.....every factor at the moment shows an overwhelming bias to the upside.
        Only a riverboat gambler would carry a short position into this week-end, IMHO.

        And yes, let's set the example on the board and continue to exchange positive information so we can increase our net worth.

        DMS

 
BRK-B
141.28+2.29(+1.64%)Sep 18 4:01 PMEDT

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