Whitney Tilson is bullish on Berkshire Hathaway.
In a presentation he gave last week, Tilson reiterated his investment thesis arguing that Berkshire was worth $178,400 per share. He also noted that the company should be worth $200,000 a year from now.
The A shares currently sit at $121,800, which implies a 64 per cent return in 12 months.
Here’s the slide from Tilson’s presentation:
Photo: T2 Partners
Here are the catalysts Tilson identifies that could get shares going:
- Continued earnings growth of operating businesses, especially as $1+ billion of pre-tax earnings from Lubrizol are incorporated
- New equity investments
- Additional cash build
- Meaningful share repurchases
- Eventually, Berkshire could win back a AAA rating (not likely in the near term)
- Potential for more meaningful acquisitions and investments
- If there’s a double-dip recession, this becomes more likely
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