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Is Berkshire more like a Mutual Fund than a stock?

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  • @msf
    >> "the market" (well, 90% of it) had an average TTM P/E of 34.2 at the end of October.

    Wonder what it is at the close today. The much critiqued Shiller is above 33 again.


    @LewisBraham
    >> ... think of Apple as a high quality company with a lot of cash and a moderate to slow growth rate in 2020. It is arguably as MSF describes it—blend—a blue chip stock with its heady growth days in the past.

    Maybe, but experts have been saying this for decades, peculiarly. If you compare Apple w/ say SP500, or w/ IVW, or indeed w/ QQQ, whether from two summers ago, from spring '17, from fall '16, from last Thanksgiving, or ytd, you see no such thing. It still looks like all rock 'n' roll all the time.
  • edited November 2020
    I wouldn't compare BRK.A to anything else. Nothing typical about it.
    Apple P/E = 35.6 (link)
    Apple earning are so huge and why it has so much cash and it's harder to show growth but it still shows it and why it's amazing.
    I don't think that apple is just another blue chip.

    BTW, personally, Apple is the only company I ever banned. I never bought any of their products and would never do it in the future based on Steve Jobs behavior toward his employees, friends and family and its ridiculous product prices but Apple is a fabulous company:-)
  • msf
    edited November 2020
    I wouldn't compare BRK.A to anything else.
    FD1000 said:

    I don't see any reason to own BRK.A
    SPY beat it easily for 1-3-5-10 years and with lower voltility.

    Okay.

    Apple P/E = 35.6 (link)

    You must have a reason in mind, some point you're trying to make, by presenting this figure in isolation. Whatever it is, the point isn't clear.

    If it is to show that AAPL's P/E on Nov 25 is higher than the 33.19 P/E it had on Oct 30th, well, sure. It goes without saying that over a short period when the earnings denominator (a quarterly datum) doesn't change, P/E will move in proportion to price movements. And this month, most stock prices have been going up, so most P/E's have been going up. Nothing special here.

    If the point is to hint that AAPL's P/E is high, whatever "high" means, context matters. Certainly 35+ is high relative to historical stock market averages. But relative to the current (Nov. 25) TTM S&P 500 P/E of 41.34, it is low. Not bargain basement low, but notably lower than the typical large cap stock.
    https://www.wsj.com/market-data/stocks/peyields
    https://www.wsj.com/market-data/quotes/AAPL

    Apple earning are so huge and why it has so much cash and it's harder to show growth but it still shows it

    Certainly Apple's earnings are growing year by year. Though based on 5 year EPS growth rates, it is growing more slowly than not only the other top 10 stocks in VUG (your choice of growth index), but more slowly than eight of the top 10 stocks in VTV, including BRK.A (okay, you don't like that one), Procter & Gamble (PG), JPMorgan Chase (JPM), UnitedHealth (UNH), Verizon (VZ), Disney (DIS), Pfizer (PFE), and Comcast (CMCSA).

    Moderate, steady growth. Some people call that a blue chip. You choose to call it growth. Whatever.

  • >> ... based on 5-year EPS growth rates, it is growing more slowly than ... Procter & Gamble (PG), JPMorgan Chase (JPM), UnitedHealth (UNH), Verizon (VZ), Disney (DIS), Pfizer (PFE), and Comcast (CMCSA).

    Hmm, a remarkable fact given my more recent analyses: '... compare Apple w/ say SP500, or w/ IVW, or indeed w/ QQQ, whether from two summers ago, from spring '17, from fall '16, from last Thanksgiving, or ytd, ... It still looks like all rock 'n' roll all the time.'

    What a period this is, huh.
  • Strange but true. Figures (as I noted a few posts ago) are from Fidelity's "Key Statistics" page for the respective companies. The number represents "EPS Growth (Last 5 Years)".

    AAPL is no slouch, but everything is relative. Quite a period indeed.

    AAPL: 7.31%
    PG: 10.14%
    JPM: 15.17%
    UNH: 20.25%
    VZ: 13.95%
    DIS: 8.04%
    PFE: 15.27%
    CMCSA: 12.08%

    and the subject of this thread, BRK.A tops this collection at 32.74%.

    (I post this as much to check my previous post as to make the figures concrete. It's always possible I could have made a mistake.)
  • edited November 2020
    Maybe the following 1 and 3 years performance charts of SPY,AAPL,QQQ,BRK/A,JPM will convince you that Apple IS NOT another "blend—a blue chip stock ". If they don't I give up.
    image
    image
  • It is arguably as MSF describes it—blend—a blue chip stock with its heady growth days in the past.
    Agree with msf and Lewis assessment. The fast growing business (iPhones, computers, music, and AppleTV) since Steve Jobs's returned has plateaued. In some area Apple is trailing. However, they are still very profitable (compare to Samsung per unit phone sold) but they are in solid single digit growth. Apple today is pushing more in their service business while they have an business ecosystem is unmatched by their rivals.
  • edited January 2021
    Apple is a "blend—a blue chip stock with its heady growth days in the past"

    image
  • edited January 2021
    You are confusing price momentum with growth. A value or blend stock can also beat the S&P 500’s returns. They can also have price momentum. Growth is about revenues, cash flow and earnings versus the benchmark and industry peers and it’s forward looking, not from five or ten years ago.
  • edited February 1
    Several past posts:
    1) "MSF describes it—blend—a blue chip stock with its heady growth days in the past.
    "Agree with msf and Lewis assessment. The fast growing business (iPhones, computers, music, and AppleTV) since Steve Jobs's returned has plateaued. In some area Apple is trailing."
    2) "Growth is about revenues, cash flow and earnings versus the benchmark and industry peers and it’s forward looking, not from five or ten years ago."

    FD: reality check. After another year. Apple proved it's not just another blue chip stock. It's even more amazing to do it when it's so big already.
    Apple 2021 annual EPS was $5.61, a 71.04% increase from 2020. The price followed.

    image
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