Sorry, I can't confirm what he said or didn't say this morning. I didn't listen to the CNBC broadcast for a number of reasons: I'm deaf without my electronics powered up (cochlear implant), I don't enjoy listening to anything even when the transmitter is turned on, and from what I could see, at least early in the broadcast, it wasn't closed captioned (no text).
From what I've read on the IBM board (under the topic: Dividend increase), IBM did another "Investor Briefing" last week. Their slide show is on the sec web site site, look for the Form 8-K dated February 25, 2016.
Folks on that message board who did listen in are looking for (wishful thinking?) a dividend increase of 10% (actual announcement should be at the end of April) with a commitment to buy back at least 2% of the shares per year.
If you want to follow one of Jim's option plays, read msg # 219190 on the other board.
Briefly, on the 18Sep2015 he bought an $80 20Jan2017 BRK-B Call, he paid $52.10. The closing price for the stock on that day was $129.10. That's 490 days to expiry. What do you think, will he make any money on that trade?
So it looks like you made about 3.4% on that trade, assuming you closed the contract today by buying an offsetting put at $4.75.
Check my arithmetic (on a per share basis, ignoring transaction costs).
Sell a Put, give up $120.00 in collateral to receive a Put premium of $8.60 = -$120.00 + $8.60 = -$111.40.
Buy an offsetting Put, pay $4.75 to release the collateral from the first trade = - $4.75 + $120.00 = +$115.25
$115.25 / $111.40 - 1 = 0.034 = 3.4%
Is that how you see it?
Hey hjc, want to buy IBM AND beat BRK? Here's an idea: buy SPHD. From inception, 10/18/2012, to 2/26/2016, it's XIRR of 13.16% has beat BRK's 11.83%. It's also 1.69% IBM! A portfolio of only 50 stocks which were selected by first screening for the highest 75 dividend paying stocks and then, on the second pass, screening the first list for the 50 stocks with lowest beta. Hence the name, SPHD - PowerShares S&P 500 High Dividend Low Volatility Portfolio. Oh, yeah, almost forgot, it PAYS a MONTHLY dividend. FD: I don't own it, I do have some reservations, but for you gamblers it's worth a look.
hjc, I'm afraid that your irrational hatred toward IBM is clouding your thinking. My guess is you hate IBM for having stole the limelight from BRK. But really, isn't it just human nature that folks prefer to buy whatever Buffy's currently buying (under the assumption that its current price must be a bargain) rather than what he's selling (BRK-B, indirectly via the B&MGF)? So your complaining, daily, about the obvious is not only futile but tiresome for those of us who read your posts.
I do happen to believe that BRK's IV is about 1.3X BV. So for me, Buffy's offer to buy back shares at 1.2X is at a material discount to IV.
JMO, but BRK has been trading within a few percentage points of IV and anyone who now chooses to pay more than 1.3X is setting themselves up for a significant short term loss. If you buy at 1.5X and sell five years from now at 1.2X, that'll knock 4.3% per year off of whatever the business (annualized change in book value per share) does. Buying at 1.3X drops the 5-Year annualized loss from 4.3% to 1.6%, that's far more tolerable.
« Last year at 150ish I posted that brkb had reached full and fair value, at 1.5 xs BV, it was a good sale or call sale. buffett has an obligation to make an effort to get brkb back toward. »
At 1.5X BV, BRK-B was trading at a 25% PREMIUM to what WEB has REPEATEDLY said he would pay, 1.2X BV.
WEB is under NO obligation to bail ANYONE out of their mistakes.
Live & Learn.
Back to page 3, (PDF page 5):
" ... Berkshire’s intrinsic value far exceeds its book value. That’s why we would be delighted to repurchase our shares should they sell as low as 120% of book value. At that level, purchases would instantly and meaningfully increase per-share intrinsic value for Berkshire’s continuing shareholders."