No. of Recommendations: 11
2 options:
A) The reason for the higher multiple is because Berkshire under Abel is indeed a different company now, therefore said channel which applied to the old company is of no more relevance, BRK´s valuation changed permanently.
B) The multiple is higher because of external reasons: Fear and accordingly sector rotation into what is seen as safe. In that case the current higher multiple is temporary and something has to give, either price or value.
There is a third option:
C) The interest rates had bottomed in 2021 and are in a secular upswing which makes the float and value of a well-managed (meaning disciplined u/w) insurance company worth more.
And finally, it could be a combination of all three.
