So how do you view DG now are you looking on a 1-2 year basis or 5 to 10 yrs out?

Well, as mentioned, I am often dumb, sometimes predictably so. I expect I'll slightly-less-than-double my money relatively quickly and cash out. Again. 18 months, wild guess??

The time frame till I do my dumb selling depends somewhat on what's cheap at the time. For example, I've bought a whole lot of DG right now because the shortish term outlook for Berkshire doesn't seem unusually good.

The super simple case fro DG:
(1) I figure they'll probably make over $11 a share next year. If not then, then shortly thereafter.
(2) They'll probably trade at over 20 times earnings within 18 months. If not then, then probably not all that long after, and earnings are likely to trend higher till it happens.

So, 11*20= $220, which is up 42% from $155. Without any leverage, that's 19%/yr compounded if it takes two years. My baseline expectations for Berkshire's price in the next year are more in the range of inflation plus 2%, give or take a few percent. I like to be pleasantly surprised, so I certainly haven't sold out. But my near term expectations are modest.

Jim

Berkshire Hathaway FAQ

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