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This is well-stated. I worked for a Berkshire subsidiary for a good chunk of my career, and can tell you the Berkshire values really are what drive the investm
by SmellTheGlove 10y ago
This is well-stated. I worked for a Berkshire subsidiary for a good chunk of my career, and can tell you the Berkshire values really are what drive the investment. It's not so much about fundamentals, although they do need to be very sound or on the value side, as much as focused, lean management with a clear plan. In this case, I'm thinking Berkshire thinks Apple's share price represents a clear value at the moment (I agree, not that it matters what I think), and there's probably a lot of confidence in the management team going forward. Berkshire doesn't try to catch a falling knife, so they must think otherwise.
- spacecowboy_lon 10y agoDepends if its like BH foray into uk supermarkets which dint end well.
- SmellTheGlove 10y agoNot every bet pays off. That's why there is risk in investment. It doesn't mean Berkshire didn't perceive value or sound management, it just means that they were wrong. They're good because they're right more often than the other guys doing the same thing, but they won't hit on every bet.
- spacecowboy_lon 10y agoYes but the issues with the UK supermarkets where well known at the time.
- ambicapter 10y agoWhat's Apple's clear management plan?
- SmellTheGlove 10y agoCouldn't tell you. I don't follow them that closely. But I bet Berkshire does - they tend to do their homework before investing.
- Bud 10y agoMake better products than everyone else, have better supply-chain management than everyone else, and have higher profit margins than everyone else even dreams of. It's a plan that has been working out fairly well.
- snowwrestler 10y agoRight. A management plan is not the same thing as the product roadmap. Apple is secretive about their products, but not how they run their business.