(Copy/paste from Excel, effect of even large share repurchase would be very limited? +5% intrinsic value)
| Berkshire $100b Share Repurchase effect on book value per share | |||||||
| I believe the Berskshire Hathaway "Owner's Manual" needs to be adapted. It now says: | |||||||
| We regularly compare the gain in Berkshire’s per-share book value to the performance of the S&P 500. | |||||||
| Over time, we hope to outpace this yardstick. Otherwise, why do our investors need us? | |||||||
| A share repurchase program at a price of around 1,4x book value will reduce book value per share | |||||||
| whilst increasing EPS and Intrinsic Value per share | |||||||
| Buffett has written that Berkshire intrinsica value is the sum of investments and cash including | |||||||
| insurance float plus a multiple of non-insurance subsidiaries operating earnings. | |||||||
| Using A share equivalents | |||||||
| Before share repurchase | After share repurchase | ||||||
| Price | $295.000 | $295.000 | |||||
| Book value/share | $211.184 | $189.423 | Down | 10% | |||
| Ratio | 1,40 | 1,56 | |||||
| Oper. Profit excl. insurance | $21.226.222.083 | ||||||
| Oper. Profit/share | $12.903 | $16.252 | Up | 26% | |||
| x 13 multiple | $167.739 | $211.274 | |||||
| Inv. + cash/share | $201.317 | $177.002 | |||||
| Intrinsic Value/share | $369.056 | $388.277 | Up | 5% | |||
| Number of A share equivalents now | |||||||
| 1.645.061 | |||||||
| Equity | $347.401.000.000 | ||||||
| Share Repurchase | -$100.000.000.000 | ||||||
| Equity after | $247.401.000.000 | ||||||
| Shares bought | 338.983 | ||||||
| Shares after | 1.306.078 | ||||||
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