Whitney Tilson: Why I'm Super-Bullish On Berkshire Hathaway, And Betting On A 44% Surge

Vince Veneziani

Whitney Tilson is a longtime Berkshire Hathaway (BRK) bull, and nothing has changed him.

If anything, he’s gotten more bullish, it seems.

In a recent presentation, found via MarketFolly, he breaks down the company and argues that the shares have 44% upside, and could go to 153,600 per class A share.

Click here to view the presentation ->

First off, let's look at Berkshire's history

Source: T2 Partners via MarketFolly

Berkshire owns stakes in many companies, including Coca-Cola, GE, and Wells Fargo. These stakes are worth $1+ billion.

Source: T2 Partners via MarketFolly

Here's Berkshire's full capital structure.

Source: T2 Partners via MarketFolly

Here's how the company's big insurance and non-insurance businesses are holding up. Check out MidAmerican!

Source: T2 Partners via MarketFolly

Insurance profits are heading back to all-time highs.

Source: T2 Partners via MarketFolly

But Berkshire is changing.

Source: T2 Partners via MarketFolly

Energy and telecom holdings are growing by more than 25% per year

Source: T2 Partners via MarketFolly

The purchase of Burlington Northern is unprecedented in the history of Berkshire

Source: T2 Partners via MarketFolly

Now, here's where Berkshire has its money tied up.

Source: T2 Partners via MarketFolly

And now we get to valuing Berkshire.

Source: T2 Partners via MarketFolly

Berkshire continues to kill it, year after year. In his mind, Warren Buffett values Berkshire at a 12x multiple.

Source: T2 Partners via MarketFolly

But we'll use a more conservative 10x multiple.

Source: T2 Partners via MarketFolly

Berkshire is still undervalued by investors

Source: T2 Partners via MarketFolly

Investors could see 44% gains within the next 12 months

Source: T2 Partners via MarketFolly

Berkshire will continue its growth through new stock investments, hoarding cash, and trying to regain its AAA rating from Moody's

Source: T2 Partners via MarketFolly

Of course, like all investments, there are plenty of risks to be had

Source: T2 Partners via MarketFolly

...but all-in-all, Berkshire is a fantastic, safe investment

Source: T2 Partners via MarketFolly

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