Subject: Re: BRK.B performance vs Price/Book
I have P/B data for 61 arbitrary months from 10/2004 to 2/2023. 220 months.
The P/B ranges from 1.11 to 1.63.
I computed the gains for 6, 12, and 18 months for each of the 61 months, then looked at how the returns were distributed according to P/B.
P/B 6 mo. 12 mo. 18 mo.
Bucket: Count Avg Avg Avg
1.10 3 9.80% 29.56% 44.54%
1.15 1 21.13% 31.87% 37.28%
1.20 6 11.75% 21.21% 33.34%
1.25 3 8.64% 10.51% 33.94%
1.30 7 7.96% 20.24% 21.21%
1.35 16 6.84% 7.65% 18.19%
1.40 7 6.93% 5.74% 11.86%
1.45 7 5.34% 16.04% 22.53%
1.50 6 3.24% 3.35% -0.74%
1.55 5 -15.04% -12.17% -11.43%
Read: There were 3 months where the P/B was between 1.10 and 1.15.
Yes, any conclusion is questionable since there were only 61 of the 220 months of data.