Re BA and Buffet,
I am sure I have read, in a BRK annual, Buffet say, "Good companies don't take write-offs." BA has written off $3 billion in the last two years. Buffet does not like turnarounds, either. This company has a weak board and inbred management, and the commercial aircraft part of the business competes with a non-profit organization. Not good industry fundamentals. If not for the above issues, I think Buffet would be interested given a reasonable "margin of safety." The various businesses are cyclical but should have reasonably predictable and sustainable ROE if managed well.
IMHO, two catalysts to look for(one mentioned before): 1) change in management and 2) changes in operating strategy at Airbus.
Airbus has three main shareholders. Two of them announced a merger last week. The combined company(if it goes through) will control nearly 60% of Airbus. They may enforce some discipline on the organization. In addition, Airbus management has stated its goal of an IPO. I think they would strive to appear profitable first. In other words, the market share competition could end. Pricing should improve.
Comments appreciated,
Andrew
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