Forget the annual parade of Street prognosticators rolling out their 2013 forecasts. Warren Buffett recently delivered a pretty telling commentary on market valuations. Berkshire Hathaway Inc. (NYSE:BRK.A) announced that it will commence share repurchases when the stock trades below 120% of its book value. Last fall Berkshire first authorized a buyback, but set a threshold of 1.1x book value. To date Berkshire only repurchased $67 million worth of shares (in the fourth quarter of last year.) At 1.2x book value, it sure looks like Berkshire is going to be buying back more shares starting….now.
Two books offer advice on being like Warren Buffett (BostonGlobe)
For as long as I can remember, the investment maxim that most evokes a mix of adulation and performance anxiety is “Invest like Warren Buffett.” How can mere mortals emulate a deity? In truth, most of us will never come close to “the oracle of Omaha.” He’s done all the things a stellar investor should do: He buys when there’s blood in the street, finds solid companies at great prices, and keeps them forever. Lacking Buffett’s phenomenal verve and mettle, though, most of us won’t do this. But that doesn’t mean we’re doomed. Fortunately, the multibillionaire chairman of Berkshire Hathaway Inc. has been generous with his wisdom, and two recent books compile and analyze it elegantly: “Tap Dancing to Work,” by Carol Loomis, a longtime Fortune writer and Buffett friend, and “Think, Act and Invest Like Warren Buffet,” by Larry Swedroe, director of research for Buckingham Asset Management. What key advice resonates most?
‘Triple’ tips to follow for successful sales (TheGlobeAndMail)
When Warren Buffett makes a deal, it’s usually quick, as with the purchase of Nebraska Furniture Mart. Rose Blumkin, the 89-year-old founder and owner, told him one day she was tired of fighting with her children about running the company and wanted to slow down. “Rose, I’ve always told you that when you were ready to sell, I would buy. What’s your price?” he replied.
The Snowball Part One: A Look At Warren Buffett’s Early Life (Valuewalk)
I had wanted to read this book for a long time, and I asked the publisher for a copy of the book. No copy came, and I asked years ago. Recently, Alice Schroeder came to speak to the Baltimore CFA Society, and after hearing her good talk, I decided to get a copy from the local library (12 copies available in the system). This book is complex. It’s a great book, but you have to appreciate why it was designed the way it was. Warren Buffett is a complex guy, as you might expect from the only man to become ultra-rich from investing alone. That’s why the book is long. I did not mind that; I even read the footnotes to get the nuances on when Alice’s sources did not agree.
How to Build a Portfolio With a 7.4% Yield (DailyFinance)
Super-investor Warren Buffett once said: “Put all your eggs in one basket and then watch that basket very carefully.” Buffett knows the value of diversification and the benefits of concentration. Don’t get me wrong, I think diversification is very important. But massive gains can be made by getting just a few picks dead-right. Buffett knows this. I’ve trawled the market to find a collection of high-yielding shares. The drawback is that my portfolio below contains just a few shares and is heavily biased toward insurance.
Buybacks: Now Even Buffett’s Doing It! (Fool)
Share buyback programs tend to have a poor reputation among private investors. If a company has surplus cash to disperse, many prefer to see it paid out in a dividend. So news that Warren Buffett’s Berkshire Hathaway group is buying back shares in spades sends confusing messages. The Oracle of Omaha’s words of wisdom are followed by private and professional investors alike, and in the past he’s been less than complimentary about buybacks. …There is no shortage of companies on the FTSE 100 buying their own shares at the moment. Companies such as British American Tobacco PLC (NYSEAMEX:BTI), Imperial Tobacco (LSE: IMT ), GlaxoSmithKline plc (NYSE:GSK), and Wm. Morrison (LSE: MRW ) announce purchases practically daily.
For Power and Status, Dominance and Skill Trump Likability (ScienceDaily)
Finding the next Barack Obama or Warren Buffett might be as simple as looking at who attracts the most eyes in a crowd, a new University of British Columbia study finds. For the study, which used eye-tracking technology, participants who observed groups of strangers were able to accurately predict who would emerge as leader of the group in 120 seconds or less.
