We Study Billionaires - The Investor’s Podcast Network TIP289: Intrinsic Value Assessment of Berkshire Hathaway by Jake Taylor (Business Podcast)
Mar 29, 2020
Jake Taylor, CEO of Farnam Street Investments, dives deep into the intrinsic value of Berkshire Hathaway, sharing crucial insights from Warren Buffett’s latest shareholder letter. He discusses the company’s financial strategies and the significance of its diverse segments. Taylor also evaluates whether Berkshire can serve as a cash substitute in investment portfolios. The conversation touches on value investing philosophies and the role of corporate culture in long-term success, alongside addressing listener queries about investing in stocks within Berkshire’s portfolio.
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Opportunistic Investing
- Jake Taylor's investment process involves seeking undervalued assets and companies with good capital allocation.
- He's been hesitant to pay high prices for compounders, even recognizing their value.
Declining Relevance of Book Value
- Warren Buffett removed the book value column from his shareholder letter, signaling its declining relevance for Berkshire.
- He highlighted the impressive long-term returns of Berkshire compared to the S&P 500.
Berkshire's Business Overview
- Berkshire Hathaway is a diversified conglomerate with major segments including insurance, railroads, energy, and a marketable securities portfolio.
- It also includes a manufacturing, service, and retail segment, representing a broad swathe of the US economy.
