When you say sustainable, are you referring to the numerator decreasing or the denominator increasing??

To neither of the two. To the pure ratio instead. A ratio which moves very reliably in a narrow channel since a quarter century, with BRK currently being at the upper border of that (percentile 80 of Jim´s list in post 21857).

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.

So much for the objective thinking - as far as I am capable of :)

My subjective opinion: That Berkshire and Markel (I didn´t look at other stocks in the same "bullet-proof safe haven" category) since 1 month are strongly rising in tandem up while especially the Nasdaq since 1 month is equally strongly falling for me clearly points to B - and provides my personal answer to your question: It´s not about a change in Berkshire´s value, therefore it´s current price is unsustainable*.


*As long as value does not catch up with price in the near future.
And without me making any forecast about when it´s price will come down again otherwise, as in the previous years it stayed at such lofty Price/BV ratios for a full 1.5 years before coming down again.
Therefore though again being fully loaded with puts I choose Mar&Jun´27 ones to give that process some time.