Berkshire Is the Most Attractive Blue Chip Stock According to Wedgewood Partners
- The math on the valuation is pretty easy. Fair multiple on trailing $7,000 per share in earnings is about 10. When you add the balance sheet investments to this you get to $170,000 per share.
- Thinks fair value a year from now will likely be $185,000 per share.
- Agrees that Berkshire is difficult to analyze and that Buffett isn’t Wall Street friendly, but share buyback plan shows that Buffett is shareholder friendly. Wedgewood wishes Buffett would aggressively buy back shares now.
- The share buyback literally puts a floor under the stock creating an asymmetric risk/reward scenario.