Jan. 19, 2010 | Filed Under: BRK-A , BRK-B , BNI , ITB
Author: guruek
Is now the time to buy Berkshire Hathaway Class B shares on a split?
T2 Partners managing partner Whitney Tilson certainly thinks so.
In the latest CNBC interview, Tilson stated that he thinks BRK-A has an intrinsic value of around $14,000 per share and currently it is traded at a biggest discount to intrinsic value ever.
He thinks Berkshire Hathaway will be substitute Burlington Northern Santa Fe (BNI) in the S&P 500 after the merger and the Class B share split. That will be a catalyst for the stock to move up.
Elsewhere, he thinks housing trouble is not over and there will be more foreclosures coming into the market. The country does not need that many new houses in the next couple of years, hence, it makes sense to short the home builders. ITB is the iShares for home builders.
Tilson also thinks certain small regional banks may continue to struggle and that makes them ideal shorting candidates:
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