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Strategies & Market Trends : Buy Berkshire instead of Vanguard S&P (BRKA)
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To: Jurgis Bekepuris who wrote (276)5/29/2007 6:53:22 PM
From: matherandlowell  Read Replies (1) of 313
 
"You can say that the debt is possibly "free", but you can't just deduct 80K per share from the stock price as if debt did not exist at all."

That's my entire point. The Berkshire annual report says that the $80,000/share is free of all debt. Read the report. There is no doubt that the company has debt. But that debt is balanced against other assets. The point made in the report is that $80,000 is free of debt. What I am saying is that it is reasonable to deduct that figure from the share price and calculate multiples. In other words, the $3500/share of earnings and $50,000 share of revenue should be viewed as if the company had a share price of $30,000 rather than a share price of $110,000.

j.
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