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Chris Bloomstran

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2026-04-26

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2026-04-26

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1. “I think that's right. Profit margins are durably higher than they were when we were more of a manufacturing-based economy. Warren's 1999 article in Fortune was an amalgamation of a series of species that he gave, one honoring Ben Graham, I think, at Columbia. But essentially he was saying we're in a secular peak without saying we're at a secular peak. And margins and multiples were high. And he noted correctly, but ultimately wrongly, that margins were range bound, and I think he used a range of 4% to 6.5%. And in 99, the profit margin on the SP 500 got up to 7.5% or 7.6% wherever it wind up getting. So that was above the historical norm. Now, at a moment, they hit 8.9% in 1929. But from the point of that secular peak, he was right and a high multiple to earn.”

   2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

2. “For what they do. They don't have an EBITDA structure. They run net cash on the balance sheet. They've never resorted to leverage, so you wouldn't run an EBITDA. But EBITDA, which is above all the lines, if you're motivated by EBITDA and revenue growth, I mean, you can put a whole bunch of business on the books and not have any of it make any money because if you've got a lot of interest expense and your capital intensive business and you've got big maintenance CapEx, you may throw off a lot of EBIT.cash flow, but you may not make any return on capital. And so those structures wind up being pretty poor. And more often than not, you see it in the way companies make acquisitions and how they deal with their own company shares. And so you've got to be careful with comp and make sure you're not too disaligned, but you almost always taste a little bit of your vomit with everything you own.”

   2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

3. “Flow and a return on invested capital. They don't have an opportunity set to reinvest in the business. So you want to measure the business by its operating cash flow in a cyclical business over time. The ones that I really struggle with are the ones that are adjusted EBITDA heavy or where you're motivated by sales growth with no tie to profitability. So Starbucks is in the middle of turning around. They've got a new CEO that I like couldn't stand the prior one. And I forget the name of the acronym for their program, but they're measuring comp based on back to Starbucks, based on same store sales growth and operating income. Well, there's no tie to the capital earned at each of the stores. Deckers, which we made a big position. They've been a huge growth story and they're compensated based on revenue growth and pre-tax income. It's suitable.”

   2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

4. “And so recently I took, I said, run the Simper 13F Gemini. I said, run Semper's 13F portfolio and summarized the top 20 holdings through their proxy statements on how each company's compensation systems work. And I wanted to see how accurate it was. I mean, it was absolutely accurate. I mean, it pulled out my top 20 holdings, U.S. holdings, the ones that we disclose in order, and summarized the bonus hurdles, the short-term hurdles, the performance hurdles. And it nailed the ones that I think get it right. I mean, Cummins, I've talked about Cummins many, many times and how they've got a return on capital hurdle motivation dollar general has a three-year rolling return on invested capital. Then they throw in their bonus, which uses EBITDA, which is a terrible way to do it. Ollen does an adjusted cash.”

   2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

5. “So none of these are perfect. You just don't find a comp structure might, oh, that's the gold standard. I found the Ark of the Covenant. So what I found over my 35 years managing money and reading proxy statements is you just have to get used to tasting a little bit of your vomit. And if it's too much vomit, then you need to move on. And that's generally when you found somebody that doesn't have the integrity or what have you. It's funny. You know, I love AI for its search capability.”

   2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

6. “There's a lot to integrity and morality, and either you've got it or you don't. And there's no pay package, there's no compensation structure that's going to alter behavior in how you wired. I think it's unfortunate the way most compensation systems are structured with a modest salary performance bonus that may or may not have hurdles. And then you've got longer term and shorter-term hurdles on your performance shares, your restricted shares. There's just too much short-termism that comes with the way most comm structures are structured. And it's the ones that align. Where you tend to get better behavior. But you're right, it boils down to the people”

   2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

7. “Under the Berkshire umbrella. And so Ajid is approaching his role no differently than Greg. And that's A, maintain the culture. B, never put the business in harm's way. And let's just grow the economic earning power of the business as best we can without subjecting the business to undue risk. And so I like the comp structure.”

   2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

8. “Option away to anybody they've never given a restricted share away. The board is extremely, I mean, silly how little they're paid per board meeting. A few hundred dollars per board meeting, you make a little bit more if you're on the audit committee. But the board all owns big positions in the stock. And everybody's bought them and paid for them out of pocket. Ajit owns far more than Greg, but he's been around Berkshire since 1986. Every share he bought was paid for out of pocket. And so there's an alignment when you reach into your own pocket and chunk down very real capital. Your livelihood is driven by how Berkshire does. And you could argue that Ajit's compensation should be tied to how the insurance operation does. And Greg should have been compensated by how the operating companies do. But no, I mean, they're in it for the entirety of Berkshire. And there's a benefit to having all of these businesses.”

   2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

9. “For Greg. I mean, I'm going to do everything I can to make sure that Berkshire and I are successful. What hopefully is a 20 year run. And he said, I'm not going to get as long of a run as Warndig is 1965. Warren was 35, and I'm 62 or 63. But hopefully I get a couple decades doing this thing. And because he gets the culture, he's not going to put the business in harm's way, there's no return on equity hurdle. There's no hurdle that would wind up being short-term in nature that I think would be an improvement over being paid a sum of money, a good sum of money. It's not outrageous. It's way less than a lot of CEOs make. It's not a trillion dollar pay package. And then to turn around and say, yeah, I'm going to buy the stock with all my money is essentially Warren for years and years and years and Charlie making $100,000. I don't need the money. I'm already rich. I'm motivated by the responsibility of running Berkshire Hathway. So I think in Berkshire's case, and it's rare, but they've never given an estate.”

   2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

10. “million dollars at cost of Berkshire, which on a market value basis is pushing $180 or $190 million. And presumably he's got other equity market investments. I don't think he's going to be a guy that has 30 homes and owns islands. He's going to live within his means, like Warren has. And so I don't think there's a performance hurdle that would be suitable other than the fact that Warren trusted him in a role that we hope he's in for a long time. The shareholders trust him. He's got a responsibility to Berkshire. And I think he's taken that on very positively. And so if I were in his shoes, I wouldn't want to disappoint Warren. I wouldn't want to disappoint the board. I wouldn't want to disappoint the shareholders. I wouldn't want to disappoint myself. So I'm going to exert every ounce of energy that I have. This is me speaking.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

11. “Rich. He was paid out for his modest 1% ownership position in Berkshire Hathaway Energy three years ago, four years ago, whatever it was for $870 million, so call it $600 million net attacks. He turned around. And prior to that, I was a little, I wouldn't say concerned. And I don't know how much liquidity he had. And he had that big BHE position that was illiquid. privately owned on paper. But I think he owned five A shares in just a couple B shares. And so I own more than Greg. And Greg was running around as vice chairman for a bunch of years and you thought, gosh, you really want to see the CEO or the CEO to be own more of the stock. But when he was paid for his BHE position, he turned around pretty quickly and has cumulatively bought, I don't know, 100 plus million.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

12. “To me, it's the right way to do it. When Greg and Ajit got promoted, moved up, kicked up to vice chair of operations and insurance, they had matching salaries. And I don't remember where they started, but they were $17 million and they were $18 million. And a couple years ago, they were 20 or 20, I guess, 21. Greg, now that he CEOs $25 million, I don't think there's no better way to do it. Compensation is a hard thing. He's already rich. And he's in his early 60s. I mean, he's at the age where the typical CEO who knows that he or she is going to be in that chair for four years and they're going to get an obscene amount of stock options and restricted shares. They're highly motivated to get the stock up. And then you've got these goofy compensation schemes and different performance hurdles, some of which are better aligned with shareholders than others. Greg's already.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

13. “And so at the next big opportunity, he's got to put $300 billion on the order of $300 billion to work if sufficient opportunity exists. And if you get through a cycle like that in a period and they find they can't do it, that they don't have the opportunities to buy whole companies, there are plenty of places in the stock market to put that capital to work. I mean, there are among the largest cap companies in the world in the United States. There are some really good businesses that they could buy 10% of, 15% of and that are liquid or not to do it pretty easily. But you got to do it at the right price. And so I'll judge him harshly. The shareholder community should judge him harshly if he doesn't swing hard at the next big chance.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

14. “It's not easy when you're staring down the barrel of a financial crisis. It's not that easy to pull the trigger. In retrospect, it's always really easy because you can pinpoint how ridiculously low prices were and how great the opportunity was. I think he'll do it, but I'm not going to judge Greg until after the fact. And that may be this year and maybe five years from now, maybe 10 years from now. I hope it's not 10 years and I don't think it'll be 10 years because I've got that little section in my letter about the opportunity costs to holding cash. And you will never recover if you're sitting on cash earning 3% for too long. If you compound stocks linearly at 10%, this is what my table shows. You take $100, it becomes $110. At year one, it becomes $121 at year two. It becomes $259 at year 10. I mean, pretty soon, at five or six years, and stocks don't compound linearly, nor does Berkshire. But you get to the point where you've got to have a 30 or 40 or 50% drawdown to justified owning the cash.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

15. “Greg's got to Rolodex. He's got his network of managers within the business. And so as he approaches capital allocation, it's not just Greg sitting in an office in Des Moines making decisions. He's got the Berkshire Empire at his disposal and Ted's going to wind up being an indispensable part of that. I mean, that's how, if I was running it, that's how I would do it. I think that's how it's evolved. And so I like that commentary because it confirms what I think is probably the right way to tackle the capital allocation levers, which is Rig's rolling. It's hugely important that he gets it, that he's got the willingness to swing hard when it makes sense to swing hard. And just because the media tells you, oh my God, this cash piles out of control, they're too conservative. Now, they're going to do it on Berkshire's terms. And I hope he's the right guy for the job because we're going to get those opportunities. And as you know,”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

16. “And is Greg in the letter elaborated on Ted's role? I mean, Ted's running a sizable amount of capital, but I'm certain that they're talking regularly. The next big opportunity to buy an entire business or to get a big chunk of money at cost, they got 36 billion, Warren got 36 billion invested in Apple at cost. Heads roll may be running a farm system. I think my guess would be when Greg does an Oxychem deal, one of the folks inside Berkshire, he's going to lean on for an opinion is going to be Ted. So Ted's role is beyond just running his little corner of the stock portfolio, but he's looking at deals. If they're looking at buying companies, Greg's going to have more than his own set of eyes on these deals. He'll have folks on the board that have expertise in various industries that he'll rely on. So Greg will.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

17. “I think instead of judging his letter, judging what Berkshire does at the next opportunity, and he said, we need to be opportunistic. Warren acknowledged that in 0809, he screwed up and he didn't do enough. So he got the $5 billion and the $3 billion into the GE and the Goldman preferred, got some of the Dow preferred, the warrants, later did some of the Bank of America. But on the stock port, he didn't do a lot in the stock portfolio. And Berkshire had cash reserves that have averaged about 14% of firm assets since 1998. He could have swung a lot harder and had acknowledged that he should have swung a lot harder. We're all going to judge Greg. I'm going to judge Greg by how hard he leans into opportunity when it comes. And it's only going to come in a crisis or a recession. You may get a chance to buy the one-off business, but you're going to do some of it in the stock portfolio. You're going to do some of it buying whole business.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

18. “So whether he's running 6% of $700 billion or 6% of $300 billion don't know, it's north of $18 billion. I like how Greg's role and even Ted's role have evolved in that capital allocation needs to be done by Greg. It needs to be done by Warren's replacement because when you get into the teeth of a financial crisis or a recession, you're weighing opportunity cost. And so of the $370 plus billion dollars in cash, there's probably $100 billion round number that's dedicated to the insurance operation that either needs to be held as cash or fixed income. Bersher doesn't have a lot of fixed income securities. They have mostly T-bills. So Berkshire has, call it $270 billion plus another $40 billion a year that are generated by the operating companies to put to work.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

19. “There's a few interesting notes about that. I mean, A, Warren and Charlie hired Ted and Todd, Tod Wearing different hats. He was part of the triumvirate with JP Morgan and Goldman to try to fix healthcare. And they threw up their hands and said, this is unfixable. I'm not sure that there was a role at Bercher that matched what Todd thought as role might be. And so he moved on, which was fine. I think Ted probably picked up Ted's a good investor. I think he picked up Todd's portfolio. My guess is a bunch of that portfolio has probably been sold, which we'll see. I would guess in the next 13F filing. But I like the structure. And when he said that Ted is running 6% of the investments, he didn't specify whether that was of the stock port, the $300 billion stock portfolio or the $700 billion combined assets, which are now over $120 billion at the holding company, or if it was just the 580 or whatever that are in the insurance operation.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

20. “He said he's got, I mean, you can't fill the shoes, the expectation bar is really high, and he seems humble enough that he gets it, that he knows he's not going to beat the next war, and he'll have a shorter leash with all of the Berkshire watchers, both in the media and otherwise. And he's seemingly perfectly fine with that. I mean, he gets what his role is. And I thought he conveyed it pretty adequately and nicely in this year's letter, his first of what I hope are many.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

21. “Has a lot of confidence in to be essentially the CEO just overseeing 32 of the businesses because Grade can't handle the direct reports from all those companies. Warren's approach was, I'm not going to oversee anything. I mean, I buy you. I'll let you run your thing. If you call me for help, I'll pat you on the back, say good luck, you'll solve it, you're smart guy. Greg's been much more involved. He's proven that he's much more involved. Now he's got Adam helping with that. And so I thought it was a good letter. I don't know what else the world would have expected him to get into. He spent however many pages it was, 16 or 17 pages, and he talked about culture and he talked about the big moving parts and summarized the key subsidiaries and what was going on with those businesses. I thought it was fine. I thought it was good.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

22. “Too profitable. So either profitability gets eroded for loss inflation or from too much competition, and it's probably the nature of property casualty insurance, especially auto, probably the latter. I mean, you're going to see a lot of pricing pressure and price competition from GEICO's competitors. Talk about repos, talk about Adam Johnson, Katie's going to be at the meeting, his move to have Adam, who runs netjets oversee 32 or 30, I think it's 32 of the operating subsidiaries. So this is what Greg's done. Greg has done running Berkshire effectively as its CEO since 2018 when he became vice chairman. And he's gotten his arms around all those businesses. He knows what he could handle. Warren has said the guy just lives, breathes. All he does is Berkshire, balances, still coaches hockey. So he's got to balance in his life, but he's gotten his arms around this business. And he's leaning on Adam.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

23. “Throwing off over a billion, maybe a billion for cash from operations. Talked a little bit about the Oxychem deal that was his deal, the Bell Laboratories, the pest control business they bought, addressed sherry purchases. So I think he's the right guy for capital allocation, demonstrated that he gets it, got into the nuances of some of the subsidiaries far deeper than Warren has done, especially in recent years, but even perhaps entirely, talked about insurance and some of the things that I talked about a few minutes ago with Berkshire still writing at an 87% combined. I mean, that's more profitable than they should be. And he's not going to say it like that, but he said, hey, we're still writing in an 87% combined. Talked about Geico, talked about some of the headwinds that they're going to face, which we just talked about. There's going to have pricing pressure from some of the competitors. No insurance commissioner is going to give you price increases when the industry is.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

24. “Thought it was good. First time writing, he's not going to be as funny ever as Warren. But I think he hit on all of the things he needed to touch on. He paid a nice brief early tribute to Warren as he should have done, really demonstrated that he's a Berkshire guy. I mean, he gets the culture, he gets the integrity, he gets the value system of the place. I like the fact that he took the letter that he wrote to Berkshire's almost 400,000 employees and he broke that up into a handful of sections and elaborated on each of those talking points, demonstrates that he gets it, that he gets the conservatism of Berkshire, talked about specifically some of the businesses were earning cash flow from operations basis, which I like to see Berkshire earn $44.5 billion talked about pilots improvements and that it was”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

25. “Earning power and intrinsic value by 10%, maybe instead of 570 on the B shares, they're worth 580 or 585. Shouldn't do it with precision, but the stock is trading at a reasonable discount to fair value to where maybe a little bit cheaper. Bertrand buys a bunch back. And we've got a bunch of clients that don't own it or don't own enough. And I was buying it in August on the B-shares at $460. was buying it a couple weeks ago, 480. 480 is kind of the new 60 when you're six months on. And I like the stock down and not up because we've always got cash and cash flows to put to work. And we like buying stocks cheap. And I think Greg's going to wind up doing the same thing.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

26. “Quarter century, the days of compounding at 28% a year are gone. But I think if you look at the moving parts of Berkshire, the key moving parts, they can grow the earning power of the business by 10 to 12 percent. And kind of depending on what they do with sherry purchases, you got to look at on a per share basis anyway. So that's probably more than you wanted, but I think intrinsic was up a little. And so here we are talking in mid-March. This will be out closer to the meeting. But if you linearly grow”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

27. “Insurance and some of the property lines within the surplus and the primary group. So long-winded about earnings and my gap adjusted, but even on the operating earnings, you've got to make some translations to operating earnings to actually figure out what's going on and where economic profitability is. And so if you put it all together, Berkshire did grow their earnings, operating earnings last year by over a billion dollars. I think the price to buck and the two-prong are probably a little more reflective of value today because there's an underearning in a couple of the subsidiaries that are pretty key like the railroad, which I think Berkshire has a chance to resolve some of that. But it doesn't get accounted for in some of my numbers. So some are more conservative than others, but I think 9.3% growth in intrinsic value is kind of in line with what I would expect annually on average for the next 10 or 15 years. And that would be between 10 and 12 percent, which is what it's been for the last”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

28. “In a tough market, there's too much capital and reinsurance. There's too much capital in a lot of the property lines. Even in auto, holding on to market shares is going to be tough because if the industry is really profitable, your competitors are going to lower prices. So Berkshire is now classically running off insurance business. They're not renewing policies. And they've got a history of not writing business when it's unfavorable. I've got a letter. I put the letter from the table from Berkshire's 2004, I think it was annual letter, the history of whatever they called it. Portrait of a disciplined underwriter. And so for 13 years in a row, they ran insurance premiums down from $232 million to $50 million because insurance prices were not adequate. Berkshire does that. Nobody else does it that way. And they're in the process now of shrinking insurance premiums, both in reality.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

29. “Net 400 million the prior year. So there was 1.1 billion more additional write downs in 2025 versus 24. Those are not operating. Those are simply a reflection of businesses that we bought, don't have the earning power anymore relative to what we paid for them. Most companies will exclude those from earnings. Berkshire just throws them into operating earnings. So where for the year, it looked like operating earnings declined by almost $3 billion. No, they were actually up by $1.1 billion, but the world reacted. Nobody in the media got it right. And the stock just started getting just beat up. So Greg comes in with an acknowledgement to where he and in consultation with war and things fair value is, started buying the stock back. I wish they hadn't filed and told the world they were buying it because I doubt they're going to get that much bought because the stock jumped back up. Now the reality is, and Greg acknowledged it.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

30. “Been conserved on the reserving. So they tend to have positive reserve development. In 2024, they had $1.7 billion in positive reserve development, meaning they were too conservative by a factor of $1.7 billion for all of its prior years underwriting. In 2025, it was still positive, but by only $1.1 billion. So it was $600 million less. I would make that adjustment for those differences. And then Berkshire being Berkshire in its manufacturing service retail group, they were every year, they occasionally take these small charges against Goodwill for asset impairment because they've got a gazillion businesses inside Marmon. They've taken some write-downs on one of the trucking businesses extra lease. So in 2025, there were $1.4 billion of write-offs, write-downs of goodwill. The prior year was $1.5 billion.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

31. “Policy. In Otto, it's very quick tail business in the first year, two thirds of your losses develop because you wreck your car and the insurance company pays to get it fixed right away. So 65% is paid in year one. Another 20% is paid by year two. And then the last three years are longer term resolutions of things like lawsuits and medical claims, but it's all paid out in five years. If you have a workman's comp policy, that thing might pay out over 30 years. So you establish a loss reserve and then Berkshire's got their loss triangles in the footnotes. And every year they will assess the degree to which losses are developing in line with either favorably or unfavorably against what the actuaries had originally estimated and what they re-estimate each year. Well, Berkshire being Berkshire is always conservative. And you don't find many periods where they've not”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

32. “Period of time when they couldn't get profits enough realistic price on an auto policy in California, they stopped writing business. And to do so, they stopped advertising in markets where they didn't want to write. And so their policies and force cascaded down, well, here in this hard market, last year, they put their good on the gas, which they should be when they're as profitable as they are at the moment. You want as much business as you can get. So their underwriting expenses went up by 270 basis points. They spent over a billion dollars more in 25 and 24 on auto. And so they increased their policies enforced by 5%. They didn't get price. That was all volume. And so to me, the thing is still really profitable. But then in reinsurance, if you know how the insurance game works, your actuary is establish loss reserves, which will evolve over the life.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

33. “One by one, the State Insurance Commissions gave the auto insurance companies price increases sufficient to where the industry went from suffering to minting, minting money. So Geico in 2024 underwrote at almost an 80% combined, which is incredible because they normally ride at four. I think for the year 2024, they were underwriting it 82%, which is essentially an 18% pre-tax profit margin. Well, in 2025, they still underwrote at an 85% combined. So there was some deterioration. But that's still a 15% pre-tax margin where again they would normally, they and progressive try to underwrite it for in the industry breaks even over time. So the industry is still really profitable. Well, when you get into the footnote and you know what's happening in auto, they had price increases. Nobody's getting price increases now because the industry's making a ton of money.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

34. “But the Feds started cutting interest rates in 2024. And so Berkshire is earning less on its T-bills. And so its earnings are down from those two and those naturally are driving operating earnings down. But on an underwriting basis, Geico went through a period in the pandemic where they, it was just awful. You made a whole bunch of money in the pandemic and then coming out of it, everybody was driving again. And so for a time they had to give money back. All of the auto insurance companies had to refund money in various iterations. Geico did their give back program where they give you a 15% on the roll of your six-month policy. Well, then you had a period of inflation. You had inflation in used car prices. You had supply chain disruptions. You couldn't get parts. Inflation was running 9-10%. So all of a sudden, the auto industry in Geico went from minting money for a short period of time in the pandemic to losing a bunch of money or breaking even at best. And so”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

35. “It helps the stocks, but it identically offsets the face value of the debt. Now, in a realistic basis, if Berkshire chose to just refinance or repay all that debt at the moment, And the dollar had harmed its position against the end. They would have a loss. But you have an identical offset movement in the end. So you need to strip those two out. Well, then you get into each subsidiary. If you look at the main key moving drivers, the railroad was up, its earnings were up almost 9% for the year. The energy business was up almost 7% for the year. And the manufacturing service retail group's earnings were up 4.5%. Well, those three key drivers of value are half of Berkshire's value and half of its economic earning power. They were all up, not down for the quarter. They were not down for the year. And so within each of those moving parts, in underwriting. So Berkshire's been selling Apple in a handful of other stocks. So it's Common Stock Portfolio is lower. So its dividends earned are lower. Now it's cash investments are way higher.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

36. “If the dollar declines against the yen on a translation basis, that helps on a reported basis the value of your holdings and vice versa. If the dollar arises, that harms the value of those holdings. Well, for the 2024 and 2025, in 2024, you had a $600 million change loss on currency. And then you had a $1.1 billion gain in the next year. The delta there was $1.7 billion. I stripped that out, and I think you should strip it out because the currency movement is getting translated into the stocks, but Berkshire ignores the changes in the value of the stocks from reporting their earnings, reporting their operating earnings. Well, likewise, they have to mark to market the value of the debt. So if the dollar declines again, The”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

37. “Armado's euro borrowings, and they've got even a smaller amount of pound sterling borrowings. Well, all of the Japanese debt that they borrowed at 1.2% went to finance the purchase of the five Japanese trading companies in intervals over the last few years, and they own about 10% of each of those. When you own a foreign asset that trades publicly, the Japanese trading companies trade in Tokyo.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

38. “And the world took that operating earnings release this year and said, oh my God, quarterly earnings were down 30%. And year over year, they were down by almost 7%. Well, they really weren't on an economic basis. And so there were three or four really key things that the media misses and most commentators miss on it. And so where operating earnings were $44.5 billion for the year, that was down by almost $3 billion year over year. So a number of things transpired. So one thing you've got to do is adjust for currency movement. So in the footnote to that operating earnings release, they tell you about any gains or losses on the currency translation of Berkshire's denominated and foreign currencies. So they've got a bunch of money, 15-ish billion borrowed in yen, and they've got a small”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

39. “Relative to intrinsic value, at least per my calculation, was backed down to where it was in 2024 when they stopped buying shares back. So, I mean, Greg made the announcement the stock rose. We can go down a rabbit hole for a minute if you want, but even beyond my gap adjusted earnings, simply taking operating earnings, which Berkshire has a supplemental release to the 10Ks and the 10Qs, and they'll strip out from gap earnings the earnings from the stock portfolio, and they'll break out earnings by subsidiary, so the railroad, the energy operation, the MSR group, and the insurance operations.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

40. “And what Berkshire earns on an operating basis drives the capital of the business, the book value, and the assets. And so I come up with when you just do a simple average of my four methods of progression of 9.3% year over year, which gets you to a little over 1.2 trillion, almost one and a quarter trillion by market cap would be intrinsic value. And on a per share basis, that went from the B-shares a year ago, were 522. I've got them at 570 per share now, and the A shares are up to 855,396. So at the current price this morning, the stock's trading at about 85 cents on the dollar a fair value. We had a chance to buy it a couple times, so Berkshire stopped buying shares back in 2024. Greg announced a couple weeks ago after the stock declined post the earnings release that he had initiated cherry purchases again and consult with Warren and made sense in that the valuation”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

41. “Where we all strip out earnings from the stock portfolio, both realized gains and unrealized gains and losses. I also strip out underwriting, whether it's aberrantly high or aberrantly low, and assume that Berkshire is going to underwrite over time at a 5% pre-tax. And so will they're still overearning, albeit less this year than the prior year? I don't make that adjustment. So at the moment, on an earning power basis, Berkshire looks like it's earning less than I think it probably would on a normalized basis. And then for the year, you had the stock portfolio require some work to figure out what the return was. I come up with 13.7%. You've got to take the 13F holdings, the non-13F holdings like the Japanese trading companies. And I put those together. And the portfolio was up 13.7 on a total return basis. And that drives, in addition to retention of earnings.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

42. “Earnings, and you could apply whatever multiple you wanted to each, and you could back out whatever you wanted. And so he took those out and he put them back in and he changed his methodologies. And I went back and forth with it. But I still do that. And so that'd be similar to priced a book. And I find over different periods of time some of my measures are more meaningful and more relevant than others. You tend to get distortions. So for example, the railroad and even the energy business, but the railroad in particular are underearning, I think, relative to what they should earn on a normalized basis. Well, I don't make an adjustment for the under earnings in the railroad, which is still under by a billion. Now, it's been improving in the last couple years dramatically, but they've still got a ways to go. And Greg addressed that in a letter this year. But then on underwriting, where Berkshire is still overearning what I think they would earn on a normal basis.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

43. “Zenobi's, you've read the letter for a long time and we've talked now for years. I've got four essential methods that reconcile to each other that help put Berkshire's intrinsic value in a framework. I do a sum of the parts. I do a gap adjusted financials. And those are somewhat related. The gap-adjusted financials are a great teaching tool because there are so many different moving parts inside Berkshire that require adjustments to gap earnings to kind of get to what I call economic earnings. It's just a useful section from a teaching standpoint. And then you've got a very simple price to book in recent years. I've used 175% of book value, stated Berkshire's book value before. Non-controlling interest. And then the old classic two-prong method, because for years, if you go back 25 years, 20 years, Warren would give you on a per share basis marketable securities. They would give you the operating.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

44. “They've said it's going to be shorter. I like the fact that Greg and Ajit are going to field questions about the operating companies and the insurance businesses. And then he's going to include Adam and Katie on stage as well to get a little more color from the subsidiaries. And so where Warren and Charlie would spend, well, six hours plus fielding questions, some with very little business relevance. They were able to talk about a lot about teaching and life and wisdom. I expect this to be a heck of a lot more business focused, which will be great. It's going to be shorter. But hearing from these folks that are running the subsidiaries about what's going on, what concerns them is going to be great.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

45. “I am. It's my favorite week of the year, my favorite. It used to be two days. Used to go in on Friday and back on Sunday and had my little group of friends. We'd have a glass of burgundy and have a steak dinner, go to the meeting, get up early, go to the meeting, repeat the burgundy and steak dinner, and then go home. And then started going to the Markell meeting. And anymore, I go on on Wednesday and usually have three or four speaking engagements. So it's a little more of a production and the meeting just got bigger and bigger. But the people that go, the people that I've known for years and new people you meet, there's something special about the Berkshire community that you just don't find anywhere else. There's something that Warren and Charlie created that attracts all these quirky people that share a similar value system. So it's fun and to have the changing of the guard and have Greg running the show. And Warren in the front row is going to be very different, but should be a great weekend.”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT

46. “Think we're making this an annual tradition, but always fun to catch up and look forward to the conversation. Thanks for having me”

    2026-04-26 · We Study Billionaires · TIP810: Berkshire Hathaway 2026 Valuation w/ Chris Bloomstran · IDENTIFIED FROM THE TRANSCRIPT