When reading posts, there are yellow stars against the names of the most respected Shrewds. The number of points in the star, starting at 3, represents the Shrewd'm-Star rating. This number is the average recommendation that the author received over the last 12 months.
- Manlobbi
Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A) ❤
No. of Recommendations: 0
Barron’s best guess is that assuming Berkshire bought just one stock, the target may be Morgan Stanley (MS), BlackRock (BLK), or Chubb
CB.
No. of Recommendations: 2
"" Morgan Stanley might appeal to Buffett because the firm’s main driver is wealth management, making its earnings less volatile than those at rival Goldman Sachs, and less vulnerable to the economy than those of banks. Morgan Stanley trades for around 11 times projected 2024 earnings per share, a premium to the group, and yields more than 4%.
Shares of BlackRock, the No. 1 global investment manager by assets, are about flat this year and now trade for around 19 times forward earnings, yielding nearly 3%. BlackRock is well managed under CEO Larry Fink with a leading position in exchange-traded funds and bonds. It ranks well in the industry in terms of its ability to attract net inflows of investment money.
Chubb is one of the largest and best-run property and casualty insurers. Buffett undoubtedly knows it well given Berkshire’s 50-plus year involvement in the industry.
Other top-25 financials look like unlikely targets for Buffett. Berkshire already owns Visa (V), Mastercard (MA), Bank of America (BAC), American Express (AXP), Citigroup (C), and Moody’s (MCO). Buffett sold JPMorgan, Goldman, and Wells Fargo in recent years and may not want to buy them back at a higher price.""
No. of Recommendations: 1
Chris Davis on the Board seems fond of COF
No. of Recommendations: 2
So we know the "secret" security isn't COF, because COF is a disclosed holding (likely Todd Combs).
I would bet that Barrons doesn't have any of their guesses correct either (MS, BLK, CB).
No. of Recommendations: 0
My speculation is towards Google. Warren Buffett and Charlie Munger have expressed admiration for both the company's business model and durability (to some extent). Given the decline in Google's stock in the last quarter for little while, it seems plausible that they might be directing their investment there.
The technology sector seems to be an area they are keen on expanding their portfolio in, provided they grasp its intricacies. They have repeatedly praised the exceptional qualities of Google - I believe Charlie called it best business ever.
No. of Recommendations: 1
If it is Google, they are very late and buying when it has bounced off recent lows. Could have been bought below $100 in Q1 2023 but didn't. And now he is loading up in the $130+ range. Doesn't seem likely to me.
No. of Recommendations: 2
I haven't been too impressed with the stocks that Buffett and T&T have bought (and then sometimes quickly sold) in the last few years. Airlines, banks, HPQ, VZ, GM, CHV, ATVI, Malone alphabet soup etc.
They seem more like trades made by fund managers than buy and hold great compounders forever. Apple being the sole exception in the last decade or so.
I also feel Buffett missed out on the great opportunities presented by the GFC. He made a few bucks selling preferred shares to GE and big banks, but could have done much better buying Starbucks in 2009, or Costco or Visa/MC. He did buy V/MC, but should have bought more of them instead of the big banks.
No. of Recommendations: 1
My guesses on what he might be buying are Hershey's and Dollar General.
Another possibility is Diageo, but I am not sure if it would require confidential treatment, if he was buying London shares and not ADRs.
All three stocks fell significantly in Q3, and are still reasonably priced. Maybe the recent recovery in DG and HSY share prices could be tied to his buying.
No. of Recommendations: 3
Remember when guessing that the "secret" purchase is in the category "Banks, Insurance and Finance." That is where the cost basis increased during the quarter.
No. of Recommendations: 1
Remember when guessing that the "secret" purchase is in the category "Banks, Insurance and Finance."
I missed that; thanks for pointing it out.
I just hope it is not another big bank. Buffett has a fondness for them and has a long history of owning them. But the bull case for owning them is much weaker now. Regulators keep raising capital requirements, pausing dividends and repurchases with ever stiffer stress tests. Then the self inflicted mistakes like at WFC and BAC’s recent reaching for yield with long duration bonds.
He has never been fond of the investment managers, so that seems unlikely. And BlackRock was much cheaper a few quarters ago and is close to fully valued now.
So it is likely to be an insurance company or a financial services company. Most financial services companies like SPGI and insurance brokers like AJG are expensive. A contrarian pick would be Simon Property Group, the real estate company.
I prefer my picks HSY and DG to any of the financial companies in S&P 500.
No. of Recommendations: 2
I prefer my picks HSY and DG to any of the financial companies in S&P 500.
A 10% ownership in both wouldn't make much of a scratch in Berkshire's cash pile.
Berkshire really is a behemoth.
No. of Recommendations: 0
No need to stop at 10% for an excellent company priced at a discount. Of course once ownership reaches 5%, the position will no longer be eligible for confidential treatment.
No. of Recommendations: 0
Remember when guessing that the "secret" purchase is in the category "Banks, Insurance and Finance." That is where the cost basis increased during the quarter.
I think SCHW is a real possibility, they seem to be pretty entrenched with so much hassle for advisors to move accounts. But if so it's probably a Todd Combs position. Of course I may be biased because I have a meaningful short put position.
No. of Recommendations: 0
The Motley Fool (remember them?) speculates that Berkshire is rebuilding a position in Suncor:
https://www.fool.com/investing/2023/12/04/warren-b...While there are dozens of businesses that would seemingly fit the bill, one former Berkshire Hathaway holding stands out for all the right reasons as the "confidential" stock that Buffett and his team may be buying: Canadian oil and gas stock Suncor Energy (SU -1.24%).
No. of Recommendations: 4
Which doesn't make sense since it was indicated that the "mystery" company is in the financial realm .
