No. of Recommendations: 7
Thanks to this thread I am thinking about diversifying away from Berkshire too. As hard as it might be for some to believe BRK is 62% of my total assets/worth and that lets me sleep very well. I am nevertheless thinking about diversifying as while Berkshire currently isn't exactly cheap there are some others which are and from whom I expect FAR more over a 5 year stretch. Since the best time to sell in Mar/Apr Berkshire is 12% or so down but most stocks I have in mind did fall far more since, up to 40%. Which ones? As Manlobbi likes to see more than just naked ticker symbols posted I give it a try and post my assumptions for yearly revenue growth and operating margin for the next 5 years, the numbers which decide over the profit then. That in turn says what multiple of that profit in 5 years you have to pay now (IV5: as lower as better).
The ones I 'trust' longterm (though Alibaba is a very special case*)
Alibaba: Growth 20%, operating margin 30% => IV5 = 2.5
Meta: Market cap $313B, Revenue $118B, Growth 20%, op.margin 35% => IV5 = 3.0x
Carmax: Market cap $9.5B, Revenue $33B, Growth 10%, op.margin 6% => IV5 = 3.0x
Verizon: Market cap $161B, Revenue $135B, Growth 4%, op.margin 15 => IV5 = 6.5x
Google: Market cap $1160B, Revenue $282B, Growth 20%, op.margin 25 => IV5 = 6.6x
Markel: Market cap $16B, Revenue $12B, Growth 10%, op.margin 10 => IV5 = 8.3x
BRK: Market cap $675B, Revenue $276B, Growth 11%, op.margin 15 => IV5 = 9.7x
More speculative (wildly varying growth & margin numbers over the last 10+ years, so that assumptions for both are highly speculative), more in hope of a rebound, I might add a little of those:
American Airlines: Market cap $8.3B, Revenue $42B, Growth 5%, op.margin 7 => IV5 = 2.2x
VW: Market cap $70B, Revenue $281B, Growth 5%, op.margin 7 => IV5 = 2.8x
(*To buy that one is difficult for me, for several non-financial reasons: remains to be seen)
