Berkshire Hathaway Overvalued; Wait for a Dip

3 months ago

Sven Carlin, Ph.D.

"Berkshire is overvalued and I keep telling people it is a great business, one of the best business, potentially one of the best investments you can ever make because all the bitcoins and things like that will go to zero. there is no business risk. It will keep on compounding, but now it is pricey because the P ratio is in the 20s and usually it's better to buy closer to the tense. Does that sound crazy? Well, if you really want to patiently wait for an opportunity to buy Berkshire at a fair price, wait for recessions, I don't know, insurance disasters, hopefully not things that are ugly and then you can find it cheaper."

The speaker notes that although Berkshire Hathaway is fundamentally a strong compounding business, its current high valuation—with a P ratio in the 20s—makes it less attractive. He advises waiting for a recession or specific negative catalysts, such as insurance losses, to buy at a fair price.

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