The Rational Walk has published several hundred articles regarding Berkshire Hathaway. This archive displays all articles related to Berkshire except for In Search of the Buffett Premium, a research report published in 2011. In addition to browsing the list of articles, you may also search for a specific topic within the archive by using the search box below. A separate archive exists for coverage of other companies. Berkshire is sometimes mentioned in the Rational Reflections weekly newsletter which has a separate archive.

There are numerous approaches for coming up with an intrinsic value estimate for any business.  In the case of Berkshire Hathaway, many investors look at metrics such as multiples of book value, multiples of earnings, and float based models.  I personally favor a float based model and wrote about this in detail last weekend.  My view is that any valuation of Berkshire that does not examine the cash flow generating power of float will undervalue ...
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With all of the inaccurate information being reported about Berkshire's derivatives exposure, Warren Buffett apparently saw the need to devote several pages of his annual letter to shareholders to explain the situation in great detail.  Unfortunately, it appears that most articles on Berkshire's 2008 results either did not report on the contents of Buffett's letter or continued to provide misleading or inaccurate information.  Perhaps the reporters covering Berkshire are simply confused. Berkshire reported that it ...
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This is the fifth and final installment of a multi-part series covering the Berkshire Hathaway 2008 Annual Report and Warren Buffett's letter to shareholders.  In this post, I will consolidate the valuation estimates from the prior posts in the series and come up with an estimated intrinsic value for Berkshire Hathaway at December 31, 2008.  I will also briefly examine the events of Q1 2009 and determine what impact these events might have on Berkshire's intrinsic ...
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This is the fourth installment of a multi-part series covering the Berkshire Hathaway 2008 Annual Report and Warren Buffett's letter to shareholders.  In this post, I will examine the valuation of Berkshire's Non-Insurance subsidiaries.  As I noted in my earlier post, Berkshire's overall valuation must be examined by looking at the insurance and non-insurance subsidiaries as separate entities.  Berkshire has numerous non-insurance operating companies that we will examine in detail within this post. Regulated Utility Business ...
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This is the third installment of a multi-part series covering the Berkshire Hathaway 2008 Annual Report and Warren Buffett's letter to shareholders.  In this post, I will provide a valuation estimate for the insurance subsidiaries of Berkshire Hathaway.  Insurance has long been the largest driver of intrinsic value for Berkshire and I view it as the primary "engine" that will drive future growth. The valuation of the insurance subsidiaries consists of two major components:  (1) ...
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This is the second post of a multi-part series covering the Berkshire Hathaway 2008 Annual Report and Warren Buffett's letter to shareholders.  The first post in the series covered some highlights from Warren Buffett's annual letter.  The remaining posts will cover my approach to evaluating the intrinsic value of Berkshire Hathaway based on the data provided in the report.  This post outlines the valuation methodology that will be used and will be followed by a closer look ...
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This is the first of a multi-part series covering the Berkshire Hathaway 2008 Annual Report and Warren Buffett's letter to shareholders.  In this post, I will provide highlights of Buffett's annual letter.  In the following posts, I will attempt to determine the intrinsic value of Berkshire Hathaway based on the data available in the annual report and certain forward looking assumptions regarding the business. The Annual Letter Warren Buffett's annual letter to shareholders is one ...
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Published February 28, 2009 at 8:52 pm Berkshire Hathaway released the 2008 Annual Report and Warren Buffett’s annual letter to shareholders on February 28, 2009.  As a longtime Berkshire shareholder, I closely follow developments at the company and attempt to come up with an estimate of the intrinsic value of Berkshire based on business fundamentals.  At a time when volatility in the financial markets is at dizzying levels, it is useful for a value investor ...
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Berkshire shareholders are eagerly awaiting the release of the 2008 Annual Report tomorrow at 8am Eastern Time.  I am planning to review the report in detail and will update my intrinsic value models accordingly. Obviously the data in the 2008 report will only reflect results up to December 31, 2008.  Q1 2009 has been anything but uneventful so far in the financial markets.  The market carnage this quarter has not spared Berkshire holdings.  While using ...
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Should Berkshire Hathaway pay a dividend?  Just asking the question is enough to make some shareholders cringe.  After all, Warren Buffett  has one of the best long term records when it comes to intelligent deployment of capital.  However, asking this question is perfectly appropriate.  The value of any business is the present value of all of the cash flows produced by the investment from now until the end of your holding period.  For common stocks, ...
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On Friday, February 20, I wrote about the unusually high discount on Berkshire Hathaway B Class shares relative to A Class shares.  It appears that the discount persisted on Monday, February 23 as well but slightly narrowed to just over 32 Bs per 1 A share given the A share closing price of $75,600 and the B share closing price of $2,360.  There are many theories floating around regarding why this strange anomaly could exist.  After all, ...
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Berkshire Hathaway traded in an extreme range on Friday, February 20, 2009 and closed at multi-year lows. I happen to consider Berkshire Hathaway to be severely undervalued and I will have more to say about valuation when the 2008 report comes out next week.  In the meantime, it is interesting to make a few observations regarding a remarkable arbitrage situation that persisted for most of the day and a record high closing discount on 30 ...
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Berkshire Hathaway's latest 13F filing was posted after the close of trading on Tuesday, February 17.  This reports shows most positions in publicly traded stocks for Berkshire as well as its subsidiaries as of December 31, 2008.  While Warren Buffett is responsible for most capital allocation at Berkshire, it should be noted that Lou Simpson of GEICO handles a sub-set of these holdings.  Changes made in Q4 2008 can be determined by comparing the 13F ...
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Berkshire Hathaway will be a frequent topic on this blog.  Back in November 2008, I put together this brief analysis of the third quarter.  All Berkshire investors are eagerly awaiting the publication of Warren Buffett's 2008 annual letter to shareholders as well as the 2008 10K.  Publication of 2008 results is anticipated around the end of February.  Click on the link below for my impressions of Q3 2008.  This was written in November 2008 shortly ...
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