BRK.B rating lowered from S to S/A due to uncertainty over post-Buffett leadership and conglomerate efficiency.

It's sort of like Birkshshire. It's like you can't put it below a certain tier. But you know, we'll talk about Bur Share because there's sort of an interesting um situation there as you've got this migration from Buffett to AEL.

if you look at Bergkshire's history it might be the greatest serial choir of all time. Some of the assets that Buffett's built um they're probably going to be around 50 years from now.

Bergkshire, I think for sure will. I mean, just look like the trains for instance, you know, um with um um what's it called? Sorry. Uh Burlington Northern Santa Fe. Um so yeah, I mean I I think that that they made some really really good acquisition in the past.

I think they'll be around for a long period of time.

I think historic not without even question obviously S tier. Yes. but the question is going forward with the positioning. Um, yeah, I think uh, you know, I I as I was alluding to before, I think we found this year's shareholder meeting just a lot less inspiring.

Uh, and to Greg's credit, you know, he's considered, uh, you know, a very disciplined operator. Uh, and then yet you have, you know, Buffett kind of stepping on his toes. I I think there's genuine question marks around um you know basically the market has has long paid a premium to book value uh for Bergkshire Hathaway because you're paying this kind of Oracle of Omaha premium right you you you get the privilege of having the best capital allocator in history allocating your money for you

and so it doesn't matter if it's this um incredibly uh diverse and almost seemingly random uh collection of of companies you know what what do life insurance and and railroads and [laughter] and Dairy Queen and you know these different things uh auto insurance what do these different things have home building what do they have in common uh and um you know like I said what they have in common is that they were picked out by by Buffett and that he thought they were great bets

and um again the question is whether the this kind of mega conglomerate um whether it's it it's still as efficient and makes as much sense going forward um in the market's eyes uh when you no longer have Buffett calling the shots.

And so I think for a period of time uh you know the market is uh willing to give Birkshshire the benefit of the doubt. It's it's earned that over a long time. Um and and so I think Abel gets the benefit of the doubt.

Um but yeah, in a couple years from now, I also wouldn't be surprised if you had people um you know, if the stock were to to be flat, underperform, um I could easily see people calling for uh you know, saying that the conglomerate just doesn't make sense the way it's currently structured.

And you know, it does have a lot of high quality assets, but um maybe not as high quality as we thought. You know, we've uh saw some of the liabilities that emerge from the California wildfires.

Uh we've seen progressive take over uh market share from GEICO as the largest autoinsurer in the country.

Um, I would put Birkshshire. I can't put it cleanly in the S tier because of the the reasons um that I just cited, but I think I think S to A between the between them two.

probably feels about right where you have this in incredible pedigree. Um but definitely more uncertainty uh facing the future of the company today than um at any point in in recent history.

Yes. I mean it's hard not to just be like this goes in the S section, but I think you're completely right. Greg Ael seems really really good. Is he Warren Buffett though? I you know I think the answer to that is no. Um obviously he's gonna on the operational side of things he's maybe he is better than Buffett on that end of the uh the spectrum but um there's more to just that in inside of Berkshire to to continue having it to grow and be a good business.

So, um I think this Yes, I I I would say this probably makes sense and you know I mean we'll have to see I mean I remember we we were talking about this on the intrinsic value uh mastermind and um just from some of our takeaways and we were wondering you know what happens obviously Buffett's going to go at some point and his shares are going to go to charity which then means that um you know that there's going to be more um there's going to be less concentration of of shareholders that that are in line specifically ically with Buffett and who knows that I mean obviously we're just speculating here but there are a lot of really good assets there and if someone wanted to come in and basically change Berkshire and and make it more focused on one area who knows I mean there's there's tons of different things that could happen here

but um it's a hard job for Greg Ael and and uh I hope he does a really really good job but yeah in terms of the rating here um you know go back even five years ago and I think we probably both are just putting it this in the S tier Um, but uh with with some of the uncertainty in in that business, I think that uh that this is where it belongs.

It's a Dquality compared to Constellation Software and Birkshshire Hathway. And when you look at it through that lens, um I am more inclined to to say so it's considerably less diversified uh than Birkshshire Hathway.