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Hidden Value Gems
RT @HiddenValueGems: Semper Augustus annual letter is out. 149 pages of financial history, stories about Charlie Munger, analysis of Berkshire Hathaway, current market conditions and expected returns.
All you can wish for to make it a fun weekend!
Enjoy 😉 $BRK
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RT @HiddenValueGems: Semper Augustus annual letter is out. 149 pages of financial history, stories about Charlie Munger, analysis of Berkshire Hathaway, current market conditions and expected returns.
All you can wish for to make it a fun weekend!
Enjoy 😉 $BRK
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Offshore
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Offshore
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Hidden Value Gems
In his latest letter, Buffett has explained the value $OXY creates for the US economy and why he owns a 27.8% stake.
I am sure he has looked at $EQNR, but surprised he has not taken a stake (or maybe it is not disclosed yet)?
In this month's Capital Markets Day mgmt promised $14bn cash distributions in 2024 (19% yield) via dividends and buyback....crazy!
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In his latest letter, Buffett has explained the value $OXY creates for the US economy and why he owns a 27.8% stake.
I am sure he has looked at $EQNR, but surprised he has not taken a stake (or maybe it is not disclosed yet)?
In this month's Capital Markets Day mgmt promised $14bn cash distributions in 2024 (19% yield) via dividends and buyback....crazy!
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Hidden Value Gems
Even if you do not own $BRK, I highly recommend reading this 16-page masterpiece. Buffett also discusses his investments in $OXY and five Japanese conglomerates.
And the Meeting is in Omaha on 4 May! berkshirehathaway.com/letter…
16/16
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Even if you do not own $BRK, I highly recommend reading this 16-page masterpiece. Buffett also discusses his investments in $OXY and five Japanese conglomerates.
And the Meeting is in Omaha on 4 May! berkshirehathaway.com/letter…
16/16
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Hidden Value Gems
1⃣6⃣Financial results: “Berkshire also reports to you what we call “operating earnings.” Here is the story they tell: $27.6 billion for 2021; $30.9 billion for 2022 and $37.4 billion for 2023.”
15/16
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1⃣6⃣Financial results: “Berkshire also reports to you what we call “operating earnings.” Here is the story they tell: $27.6 billion for 2021; $30.9 billion for 2022 and $37.4 billion for 2023.”
15/16
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Hidden Value Gems
1⃣4⃣On the Utilities business (BHE): “When the dust settles, America’s power needs and the consequent capital expenditure will be staggering. I did not anticipate or even consider the adverse developments in regulatory returns and, along with Berkshire’s two partners at BHE, I made a costly mistake in not doing so.”
13/16
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1⃣4⃣On the Utilities business (BHE): “When the dust settles, America’s power needs and the consequent capital expenditure will be staggering. I did not anticipate or even consider the adverse developments in regulatory returns and, along with Berkshire’s two partners at BHE, I made a costly mistake in not doing so.”
13/16
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Hidden Value Gems
1⃣3⃣On the value of BNSF: “Our railroad carries its 23,759 miles of main track, 99 tunnels, 13,495 bridges, 7,521 locomotives and assorted other fixed assets at $70 billion on its balance sheet. But my guess is that it would cost at least $500 billion to replicate those assets and decades to complete the job.”
12/16
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1⃣3⃣On the value of BNSF: “Our railroad carries its 23,759 miles of main track, 99 tunnels, 13,495 bridges, 7,521 locomotives and assorted other fixed assets at $70 billion on its balance sheet. But my guess is that it would cost at least $500 billion to replicate those assets and decades to complete the job.”
12/16
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Hidden Value Gems
1⃣2⃣ On the importance of domestic oil production: “Our country would be very – very – nervous today if domestic production had remained at five million BOEPD, and it found itself hugely dependent on non-U.S. sources. At that level, the SPR would have been emptied within months if foreign oil became unavailable.”
11/16
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1⃣2⃣ On the importance of domestic oil production: “Our country would be very – very – nervous today if domestic production had remained at five million BOEPD, and it found itself hugely dependent on non-U.S. sources. At that level, the SPR would have been emptied within months if foreign oil became unavailable.”
11/16
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Hidden Value Gems
🔟Today's market: “Today’s active participants are neither more emotionally stable nor better taught than when I was in school. For whatever reasons, markets now exhibit far more casino-like behavior than they did when I was young. The casino now resides in many homes and daily tempts the occupants.”
9/16
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🔟Today's market: “Today’s active participants are neither more emotionally stable nor better taught than when I was in school. For whatever reasons, markets now exhibit far more casino-like behavior than they did when I was young. The casino now resides in many homes and daily tempts the occupants.”
9/16
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Hidden Value Gems
9⃣Reasons to own $BRK: “The company now owns either a portion or 100% of various businesses that, on a weighted basis, have somewhat better prospects than exist at most large American companies.”
“Berkshire’s strength comes from its Niagara of diverse earnings delivered after interest costs, taxes and substantial charges for depreciation and amortization (“EBITDA” is a banned measurement at Berkshire). We also operate with minimal requirements for cash, even if the country encounters a prolonged period of global economic weakness, fear and near-paralysis.”
“With that focus, and with our present mix of businesses, Berkshire should do a bit better than the average American corporation and, more important, should also operate with materially less risk of permanent loss of capital. Anything beyond “slightly better,” though, is wishful thinking.”
8/16
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9⃣Reasons to own $BRK: “The company now owns either a portion or 100% of various businesses that, on a weighted basis, have somewhat better prospects than exist at most large American companies.”
“Berkshire’s strength comes from its Niagara of diverse earnings delivered after interest costs, taxes and substantial charges for depreciation and amortization (“EBITDA” is a banned measurement at Berkshire). We also operate with minimal requirements for cash, even if the country encounters a prolonged period of global economic weakness, fear and near-paralysis.”
“With that focus, and with our present mix of businesses, Berkshire should do a bit better than the average American corporation and, more important, should also operate with materially less risk of permanent loss of capital. Anything beyond “slightly better,” though, is wishful thinking.”
8/16
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Hidden Value Gems
7⃣Do not expect 15% annual growth in the future: “Doubling our huge base is simply not possible within, say, a five-year period.”
8⃣Size is the enemy of returns: “There remain only a handful of companies in this country capable of truly moving the needle at Berkshire, and they have been endlessly picked over by us and by others. Some we can value; some we can’t. And, if we can, they have to be attractively priced. Outside the U.S., there are essentially no candidates that are meaningful options for capital deployment at Berkshire. All in all, we have no possibility of eye-popping performance.”
7/16
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7⃣Do not expect 15% annual growth in the future: “Doubling our huge base is simply not possible within, say, a five-year period.”
8⃣Size is the enemy of returns: “There remain only a handful of companies in this country capable of truly moving the needle at Berkshire, and they have been endlessly picked over by us and by others. Some we can value; some we can’t. And, if we can, they have to be attractively priced. Outside the U.S., there are essentially no candidates that are meaningful options for capital deployment at Berkshire. All in all, we have no possibility of eye-popping performance.”
7/16
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Hidden Value Gems
6⃣Two things $BRK looks for: “At Berkshire, we particularly favor the rare enterprise that can deploy additional capital at high returns in the future. Owning only one of these companies – and simply sitting tight – can deliver wealth almost beyond measure.”
“We also hope these favored businesses are run by able and trustworthy managers, though that is a more difficult judgment to make.”
6/16
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6⃣Two things $BRK looks for: “At Berkshire, we particularly favor the rare enterprise that can deploy additional capital at high returns in the future. Owning only one of these companies – and simply sitting tight – can deliver wealth almost beyond measure.”
“We also hope these favored businesses are run by able and trustworthy managers, though that is a more difficult judgment to make.”
6/16
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Hidden Value Gems
5⃣$BRK goal: “We want to own either all or a portion of businesses that enjoy good economics that are fundamental and enduring. t’s harder than you would think to predict which will be the winners and losers. And those who tell you they know the answer are usually either self-delusional or snake-oil salesmen.”
5/16
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5⃣$BRK goal: “We want to own either all or a portion of businesses that enjoy good economics that are fundamental and enduring. t’s harder than you would think to predict which will be the winners and losers. And those who tell you they know the answer are usually either self-delusional or snake-oil salesmen.”
5/16
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