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Non-Tech : Berkshire Hathaway Class B -- Ignore unavailable to you. Want to Upgrade?

To: Duker who wrote (1344)	2/12/2000 8:16:00 AM
From: Duker	Read Replies (4) \| Respond to of 1652

Lucid' excerpt from Barron's(?): ... Berkshire Hathaway continued its slide, as its Class A shares fell $5,850 last week, or 11%, to $45,200 a share, despite the company's denial that Chairman Warren Buffett is ill. Berkshire is down over 40% from its high of $81,000 last spring. Berkshire now trades for just 1.2 times its estimated 1999 yearend book value of $38,000 a share. Berkshire's price/book ratio hasn't been this low since 1987, after averaging about two-to-one during the 1990s. Berkshire's weakness reflects concerns about the insurance sector, which accounts for over 70% of the company's revenues. General Re, Berkshire's big reinsurance unit, is rumored to have experienced a poor fourth quarter because of the European storms and generally weak market conditions. Geico may have gotten squeezed by some of the same factors that have hurt its auto-insurance rivals. Schroeder says Berkshire is "cheap" but cautions that investors need to have a "long enough time horizon" given the sector's current disfavor. She pegs Berkshire's intrinsic value at more than $70,000 a share, more than 50% above current levels. Berkshire is expected to report its fourth-quarter profits shortly before it releases its eagerly awaited annual report on its Website on Saturday, March 11. Berkshire's drop has surprised veteran company watchers partly because Buffett stated in the 1998 annual report that the company's intrinsic value "far exceeds book value." But few investors seem interested in Buffett's creation because insurance is ailing and several of Berkshire's top investments, including Coca-Cola, Gillette and Freddie Mac, are under pressure. In denying that Buffett was ill last week, Berkshire also scotched rumors that it is repurchasing stock. Some Berkshire holders wonder why Buffett hasn't authorized a buyback since he likely considers the shares to be undervalued. Buffett's reluctance so far to repurchase stock is ironic given that he has successfully urged the managements of companies associated with Berkshire, including Coke and Washington Post, to do so. But some think Buffett's ego may be getting in the way, as he could view a buyback as an admission that he's out of investment ideas. ... HUH? DUH? I HOPE HE DOESN'T BUY BACK A SINGLE SHARE. --Duker