In Case You Missed It:

Copart Buys ACV Auctions for $1.9bn

Big news from Copart.

Chris Bloomstran on William Green’s Podcast

The Lottery and the Leftovers - Small Cap Index Bifurcation

AI Enabled Underwriting at Berkshire’s GenRe

GE Aerospace Pays Up for Castings Supplier

Berkshire paid up for PCC and wrote it down, but the market is validating the purchase. GE is paying 18x EBITDA for a PCC competitor, including projected synergies. Note: Berkshire is NOT selling PCC. One of the current owners of Consolidated Precision Products is Berkshire Partners, which has no affiliation with BRK.

“If you’re standing still, you’re not selling shoes.”

(The kicker: He didn’t even get a commission. It was all internal motivation.)

This Week in Berkshire History

September 11, 2001: Berkshire acquires XTRA for $578 million cash.

Berkshire had the ability to walk away when the stock market closed on 9/11, but didn’t.

That’s it for this week. Hit reply and let me know what you think. What have you been reading that’s worth sharing? Let me know in the comments.

Leave a comment

Stay Rational!

Adam

Order the 2nd Edition Now!

You can build an investment toolkit with any budget. In fact, I’d argue that you might be better off keeping your budget tight and putting the rest of your capital to work.

I split the investment process into four stages represented by a helpful acronym: FARM.

• Find: Sourcing ideas / casting a wide net

• Assess: A fast filter to screen the firehose of ideas

• Research: The data collection and deep work necessary to bring an idea onto your watchlist and into your portfolio

• Monitor: Alerts and ongoing work to stay on top of new information

Two Tools for 90% of the Process

Two tools cut across the entire spectrum. What’s more, they’re free.

SEC EDGAR (link): For investors in US companies, the SEC’s filing site will be a primary source of information. Go ahead and bookmark it now. This is the central repository for all annual and quarterly statements (including the incorporated exhibits), proxies, insider transactions, debt filings, you name it.

Other countries have analogs, such as SEDAR in Canada, that I’d put here too.

CapEdge (link): This is a completely free tool I’ve built a lot of my processes around. It allows you to get notifications on new filings, search them (and compare redlined!), read transcripts, view historical financial data, and group companies in folders.

The Processing Layer

You’ll need what I call a processing layer. For most people, this will be Microsoft Office or Google’s products. I’m primarily an Office guy and do most of my work in Excel and Word. Excel is the workplace gold standard, and it makes beautiful charts.

I hesitate to assign a “research cost” to this because most people already pay for it anyway. Microsoft 365 for personal use is $99/year and gives you access to desktop apps, mobile, and 1TB of storage.

The next upgrade is Microsoft 365 Business for $14 to $22/month. Call it about $250/year. This lets you have multiple users, including your own email address, and lets you set up a ShareFile site, which is helpful for organization and collaboration.

Claude & ChatGPT: Your Research Assistants

Having used both products for a while now, there’s no going back. I pay $100/month for Claude and $20/month for ChatGPT, and it’s worth every penny.

Claude integrates with your desktop files, including manipulating them, and it works inside Excel and Word. You effectively have a research assistant or intern right there whenever you need it. Dispatch it on a mission to collect 10 years of annual reports, or input financial statements into your preferred format, or find articles, or check your reasoning. It’s wonderful.

I find ChatGPT a bit quicker on the draw with queries and a good thinking partner. It also does a good job remembering previous conversations.

The big asterisk and caution here is to use these as tools and be careful not to outsource your thinking.

Research Budgets: From $0 to $1,000 to $10,000/year

Tier 1: The Completely Free Stack:

Here’s what I’d do with no budget for research. You’d either have Microsoft Office already, or you could do very well with Google Docs/Sheets.

• Broker search tools. Every broker has built-in search tools. There are many other free or free-tier sites that have great screeners. I won’t list them all.

  • Stock Analysis

  • Finviz

  • OTC Markets

• To go deeper, CapEdge, SEC EDGAR, company IR pages, Fiscal.ai, ROIC.ai

• WhaleWisdom’s free tier is all you need to view 13F filings from well-known investors

• Quartr: This is a great source for conference calls. Unfortunately, it’s only available on mobile. They have other paid products as well.

• Skip the free message boards such as Yahoo!. For higher-quality thoughts and analysis use Corner of Berkshire and Fairfax and Value Investors Club, both of which are free to lurk/browse.

• Library Card: Seriously. Many libraries give you access to tools like ValueLine, Mergent, The Wall Street Journal, and many other publications.

• Industry publications: You can find a lot off good articles for free. Some will even send you physical copies at no charge.

  ---

Tier 2: The Starter ($25-$50/month)

• ChatGPT: The first thing I’d probably add is a ChatGPT upgrade. You’ll get access to agents and more bandwidth. While not as robust as Claude, ChatGPT will hold its own at building spreadsheets and working through data you give it.

• Subscriptions: Even a serious amateur investor needs a good flow of news and ideas. Paid services like The Wall Street Journal (~$50/mo. after the intro rate) put you in the know and with a well-respected team of journalists sourcing and curating information. The Economist is also a great source of news and ideas delivered on a weekly basis. You might also add one or two Substack subscriptions from writers you admire to get exposure to their thinking and find new ideas.

  ---

Tier 3: The Serious Amateur ($100-$250/month)

Now we’re able to get a few more tools in the toolbox.

• Claude Max: I’d go right to Claude Max at $100/month. If you’re doing serious research, you’re going to need some heavy-lifting power at your disposal. Especially if you’re limited on time, which who isn’t?

• Subscriptions:

  • Wall Street Journal digital ($50/mo.)

  • Economist digital ($29/mo.)

  • Morningstar ($35/mo. or $249/year). Morningstar has its own research team and does a good job summarizing key updates for most large and mid-size companies. Full disclosure, I’ve used it for years, but I’m phasing it out as I’m not getting enough out of it lately.

• Other Paid Tools: I use a whole suite of free versions of tools from time to time. That includes TIKR, Fiscal.ai, ROIC.ai, and WhaleWisdom, among others. You might find you particularly enjoy or spend a lot of time on them, and that might be a reason to upgrade to the paid versions.

• Industry Publications: Now you might want to upgrade your industry “rags” budget to include some specific publications that give you a pulse on one or more industries.

  ---

Tier 4: Full Stack / Professional ($300-$600/month) or more

You can certainly spend a fortune on tools, but you don’t need to. You’d be surprised at how relatively small my budget is.

Tools:

• Claude Max ($100/mo.).

• Microsoft 365 for Business

Subscriptions/Research:

• Wall Street Journal

• Economist

• ValueLine Investment Survey ($200-$700+ per year)

• Substack subscriptions

• InPractise: Insider interviews. I used to pay for this but found I didn’t use it enough.

• Additional industry publications

Note that I’ve left off several tools mostly because I haven’t used them (or don’t want to pay for them). These include Bloomberg, AlphaSense, and others that run from $5,000 to $25,000 per year or more.

Concluding Thoughts

There are so many free sources of investment information today. You can build a great process with a small budget and put your savings to work in your portfolio instead.

And sure, AI is here and can do an incredible amount of impressive work and research. But that’s not enough. I believe it’s going to come down to the same thing it always does: doing the work. There’s no substitute for sitting down and thinking about what’s in front of you, whether that’s your own spreadsheet or one put together by AI.

Taking the time to build a solid and repeatable research process is worth the effort. It will build and hone skills that allow you to better utilize the tools at your disposal. And AI isn’t perfect. Far from it. Knowing how a spreadsheet should look and analyzing its outputs requires human understanding. Otherwise, how can you have the confidence to put real money to work?

Value Investing Course

I’m building a self-directed value investing course that will teach you how to become a better investor. It’s a system you can start using today to do real research.

While it’s still in beta testing, you can purchase lifetime access starting now.

See What's In the Course

More thoughts? Let me know in a private message or leave a comment.

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Stay Rational!

Adam

Order the 2nd Edition Now!

Praise for the 2nd Edition

I’m incredibly grateful for the people who took the time to review early drafts of the new material and provided feedback, as well as praise for both editions:

“If you want to understand how Warren Buffett built Berkshire Hathaway into one of the most valuable businesses in the world, you have to read this book. This is your opportunity to stand beside Picasso as he paints each brush stroke. A must read for all Buffett and Berkshire groupies.”

- Bill Ackman, Founder and CEO of Pershing Square

“I and my teammates at the Gabelli Organization have been tracking Warren’s success for some 50 years. Adam’s book captures the work and highlights the history of Berkshire and the hard and diligent work of Buffett and Munger, Jain and Abel, and Combs and Weschler.”

- Mario Gabelli, Chairman and CEO, Gabelli Funds

“Adam Mead’s discussion of the values and virtues which have shaped Berkshire Hathaway over 50 years is a must read for those investors in search of the forces that have delivered such investment value over time.” – Thomas A. Russo, Gardner Russo & Quinn LLC

“Few activities can be more rewarding for any value investor than studying the history and evolution of Warren Buffett and Berkshire Hathaway. Adam has done us a huge favor with his yeoman efforts in producing this treatise. Since it is chronologically ordered, it is an invaluable reference guide for all things Berkshire.” — Mohnish Pabrai

“Adam continues to deliver a resource very valuable to both Berkshire fans and the investor community as a whole, his depth of knowledge is clearly demonstrated here again. I thoroughly enjoyed this latest addition.” - Dan Calkins, Chairman & CEO, Benjamin Moore

“The question must be asked, ‘Why another Berkshire book?’ When you read this monumental effort by Adam Mead, the answer will be obvious. Read cover to cover, both the uninitiated to Berkshire and its most ardent followers will derive enormous utility and satisfaction from it. I learned so many new and important things about Berkshire and its history. It is my pleasure to encourage you to enjoy this gem.”

- Christopher P. Bloomstran

“Whatever Adam writes is always first-class - guaranteed.

-Andy Kilpatrick, Author, Of Permanent Value: The Story of Warren Buffett

In Case You Missed It:

Greg Abel in Tokyo on CNBC (Podcast) (Transcript)

Some interesting details on Tungaloy, Alphabet, the Japanese trading houses, Tokio Marine, and how Berkshire is going to integrate Taylor Morrison with Clayton Homes.

Berkshire Robbed! Twice!

Robbers broke into a BNSF train and stole Brooks shoes.

Squishmallows Movie

More Korean Net Nets

Sung Capital

All Korean net nets #2: who’s holding the keys?

As promised in the first batch, the Google Sheet tracking every net net in this series is now live: the price and multiples on the day I wrote each one up, my score from 1 to 5, and the return since, updated live. Premium subscribers will find the link at the end of this post behind the paywall…

Read more

10 days ago · 10 likes · Oliver Sung

The Smart Phone Era 2010s to 2020s

Scenic Route Investing by Wagner Road

TTS Part 2 Continued: The Smart Phone Era

See footnotes for links to parts 1 and 2…

Read more

17 days ago · 5 likes · Andrew Wagner

This Week in Berkshire History

August 30, 1930: Warren Edward Buffett born

August 31, 2005: Recreational vehicle manufacturer Forest River acquired.
August 31, 2020: Berkshire announces it has taken a 5% stake in five of the leading Japanese trading companies (sogo shosha).

September 1, 2023: Berkshire Hathaway Energy pays $3.3 billion for an additional 50% interest in Cove Point LNG, increasing its ownership to 75%.

September 4, 2002: Berkshire acquires Garan, Incorporated, maker of GaranamalsR

That’s it for this week. Hit reply and let me know what you think. What have you been reading that’s worth sharing? Let me know in the comments.

Leave a comment

Stay Rational!

Adam

Order the 2nd Edition Now!

The course is designed to teach a rigorous and repeatable process for researching investments, from deciding whether an idea is worth pursuing to analyzing the business, valuing it, and deciding whether it belongs in a portfolio.

Most of the course is already built. Before I consider it finished, I want a few more serious investors to go through it and tell me what works, what doesn’t, and what needs to be improved.

Beta testers will get lifetime access to the course for $99.

The eventual price will be significantly higher.

In return, I’m looking for real feedback:

• What was especially useful

• What was confusing

• Where I moved too quickly

• Where I spent too much time

• What felt unnecessary

• What was missing

• What would make the course materially better

The course uses real companies, actual filings, and practical examples throughout.

I’m going to keep the beta group small, so I can incorporate the feedback quickly.

If you’re interested, you can sign up here: Beta Tester Signup

Here’s the high-level outline and a snapshot of the Research module (click for the full syllabus):

Disclosure: Long MED (prior analysis)

About to Get Interesting?

Medifast’s enterprise value has languished below the value of its cash and investments since early 2025. As this letter from Steamboat Capital Partners notes, the market is valuing it more dead than alive.

Is that about to change?

With an activist gaining two board seats and revenue stabilizing over the last three quarters, I think things are about to get interesting.

Steamboat Capital

Steamboat arrived on the scene with that March 19, 2026 letter laying out the case for a turnaround and disclosing a 6% stake in the company.

Then, on March 20, the company announced a cooperation agreement with Steamboat, including that the company would nominate two Steamboat principals, Parsa Kiai and Jeff Rose, to the board at the upcoming AGM, replacing two existing directors. Additionally, Steamboat agreed to a standstill and voting arrangements through the 2027 AGM.

Subsequent open market purchases during August have brought Steamboat’s stake to 7.1%.

Profitability in Sight?

Alongside the leadership transition from Dan Chard (to non-exec. chairman) to former president, Nick Johnson, Medifast replaced its flagship OPTAVIA weight loss program with a new metabolic health brand called Trilivy. There are some encouraging signs of a profitable coexistence with GLP-1s.

• For starters, revenue has stabilized at $75 million over the last three quarters.

• While active earning coaches declined by almost half to 11,700, revenue per earning coach increased 41% to $6,529. The company points to its historical pattern of increasing productivity leading to coach growth and ultimately to revenue growth.

• The company expects to regain profitability in Q4 of this year. It launched an aptly named Catalyst program to rationalize costs across the organization, including AI-related efficiencies.

Q2 Operational Highlights

• Revenue of $76.4 million, down 27.6% compared to Q2 2025

• Gross profit down 30.3% to $53.4 million

• Gross margin 69.9% down from 72.6%, with most of that attributed to loss of operating leverage on lower sales

• Loss from operations of $4.3 million (-5.7% margin)

• Free cash flow turned positive in Q2, at $728 thousand.

Valuation

Read more

Over the past year, I’ve had the opportunity to work one-on-one with a number of investors with very different backgrounds and levels of experience.

At some point, you have to work through real companies, build the models, make judgments with imperfect information, and have someone challenge your thinking.

That’s what I’ve tried to build with my private investment coaching.

The program is completely customized around the individual investor. We work on companies you actually want to understand and focus on the areas where you can make the most progress, whether that’s reading financial statements, researching businesses, building models, valuation, developing a watchlist, or making better portfolio decisions.

There’s no canned curriculum. The goal is to help you develop a practical, repeatable investment process and ultimately become a more capable and independent investor.

I’ve particularly enjoyed seeing how differently the program can develop depending on the person. I’ve worked with newer investors building their foundation, experienced investors looking to sharpen their process, and business owners interested in becoming better investors while also learning more about businesses in their own industries.

I’m opening a few spots for investors interested in working together.

I’ve put together a new page explaining the program in more detail, including how the coaching works and comments from several investors I’ve worked with.

Learn more about Private Investment Coaching

If it seems like it might be a fit, you can also schedule a free introductory conversation from that page.

Adam

Private Investment Coaching is offered by Watchlist Investing, LLC and is educational in nature. Nothing discussed as part of the program should be considered investment advice or an offer to buy or sell securities.

Disclosure: Long SAM

Highlights

• Q2 depletions down 6%, shipments down 4.5%. Jim Koch noted in the earnings call that the beyond beer market is down 1% and traditional beer is down 4%.

• 2,047,000 barrels in Q2; TTM volume of 6,928,000, down 8.4% YoY

• Revenue per barrel of $278, up 1.2%; TTM of $278/barrel up 2.5% yoY

• Q2 showed declines in Twisted Tea, Truly, Sam Adam, Hard MTN Dew, Dogfish Head; offset by gains in Sun Cruiser and Angry Orchard. Twisted Tea and Sun Cruiser combined were slightly flat (Sun Cruiser is cannibalizing TT; but better in house than competitors).

• SAM’s net revenue declined 3.3% to $568 million

• On the positive side, gross margin improved 60bps YoY to 50.4%

• Reported operating profit came in at $70.8 million, but it included a $19.4 million benefit from a litigation adjustment.

• Adjusted operating profit was $51.6 million, a margin of 9.1%. Adjusted operating profit was 41% below Q2 2025.

• $265.5 million cash on the books at quarter end with no long term debt

• Repurchased $54 million in shares through the end of July

Some additional notes from the earnings call:

• Twisted Tea is under pressure but still commands an 85% market share, with no single competitor over 5%.

• In-house production was 84% vs 76% last year

• On-premise is 12% of the company’s volume

Big Takeaways

Boston Beer is swimming against a modest industry headwind. Koch himself described a 1-2% chronic long-term pressure on per capita consumption, offset by premiumization. What does this mean for SAM? It probably means continued experimentation (the company’s strong suit) and a relatively flat top line, with pricing offsetting volume pressure.

SAM probably owns the most respected sales organization in the industry and has two heavyweights in its dominant Twisted Tea franchise and its #2 position in hard seltzer with Truly.

Management runs a pristine balance sheet with $265 million cash at last count and no debt (just $32 million of lease liabilities).

The company is highly cash-generative and is using that cash flow to repurchase shares. Repurchases are running at about $25 million per quarter, or about 5% of its current market cap per year.

The one black spot is its supplier lawsuit stemming from a pandemic-era supply contract that led it to underbuy cans between 2021 and 2026. After losing in court in April, SAM owes Ardagh Metal Packaging $191 million for the judgment and accrued interest and has a total of $192.6 million accrued as a liability as of Q2. The company says it will appeal the verdict, but I see this as nothing more than additional legal expense and distraction. After tax (say 25%), the company is looking at a ~$145 million hit. That’ll hurt, but it’s not a mortal wound.

Another item of concern is that the company’s CFO, Diego Reynoso, will be stepping down on September 14. Matt Murphy, the company’s chief accounting officer, will temporarily fill the open spot. This adds to some concern over governance with Koch in the CEO spot and no clear succession plan in place. (Speculation here: this could set up an eventual sale to one of the majors.)

Valuation

Read more

In Case You Missed It:

Triumph CEO on The Freight Pod

Pilot Flying J EV Charging Hits 300 Locations

Korean Net Nets

Sung Capital

There are ~180 net nets in Korea, and I'm writing up all of them

I’m confident that Korea is the best pond to fish in right now…

Read more

24 days ago · 19 likes · 2 comments · Oliver Sung

This Week in Berkshire History

August 18, 1991: Warren Buffett elected as interim chairman of Salomon, Inc.

Read more about the saga in this excerpt from my book:

That’s it for this week. Hit reply and let me know what you think. What have you been reading that’s worth sharing? Let me know in the comments.

Leave a comment

Stay Rational!

Adam

Order the 2nd Edition Now!

They need more practice applying what they already know to build confidence in their decision-making.

That’s a big part of what I’ve learned from working one-on-one with investors over the past several months, with clients ranging from newer investors still building a process to more experienced investors looking to sharpen their judgment and gain confidence in applying what they already know.

The questions that come up in coaching are rarely abstract. They’re things like:

• How should I actually work through a new company?

• What belongs in the model and what doesn’t?

• How do I know whether an accounting adjustment is improving the analysis or just making it more complicated?

• What should I pay attention to on an earnings call?

• How do I use AI without outsourcing my thinking?

In one recent session, we walked through my process for taking a company from a quick first look to a deeper read of the 10K to a working research file and, importantly, where I try to find reasons to stop researching rather than convince myself I’ve found a good idea.

With another investor, the work was much more hands-on: spreading several years of financial statements into Excel, comparing the economics of similar businesses, and then using those same ideas to think about his own company.

Example:
A client started by manually spreading several years of a company’s financial statements into Excel. That gave us a base of high-quality financial data to compare margins, capital intensity, and returns across similar businesses. From there, we used the same framework to think about the economics of his own company. The point wasn’t just to get the spreadsheet “right,” but to build confidence in knowing what the numbers were actually saying.

Depending on where you are and what we’re working on, I may also assign readings, filings, or specific companies to study between sessions so we can use our time together to go deeper.

That’s really what I want the coaching to be: not another course or set of lectures, but a chance to work through real businesses together and develop the confidence, judgment, and repeatable process to do the work yourself.

Clients also get access to the kinds of templates and workbooks I use in my own research. Not as finished answers to copy, but as examples of how I organize the work, think through the numbers, and build a repeatable process over time.

Meeting You Where You Are

There’s also no expectation that you arrive with a certain level of sophistication. I’ve worked with investors at very different stages, and the goal is to meet you where you are, without judgment, then push you from there. What matters most is that you’re willing to do the work and improve your process.

If you’d like to see whether the coaching might be a fit, you can either schedule a conversation or learn more about the full program below.

Schedule A No-Cost Introductory Call

See The Full Coaching Program

What Others Have to Say — In Their Own Words

Disclosure: Long HTLD

Q2 Results

Heartland posted a solid improvement in operating results, though with a bit of an asterisk. The company posted a Q2 adjusted operating profit of $17.8 million on operating revenues (ex fuel) of $152 million, compared to a loss of $11 million on $186 million of operating revenues in the same quarter last year.

Its GAAP operating ratio improved to 91% and its non-GAAP OR to 88.3%.

The asterisk here is that the operating results include gains on asset sales, though to be sure they are a recurring feature of the P&L. The gain on sale in Q2 was 13.6% of revenue compared to a 2015-25 average of 4.1%. Making this adjustment, Heartland’s operating margin went from -2.9% in 2025 to -1.2% in Q1 to +0.2% in Q2. A worthwhile improvement, yes. But not as strong as it first appears.

There are a couple of ongoing forces at play in the industry:

• Freight volume and pricing are up, in part thanks to tighter industry capacity

  

• Related, Heartland continues to right-size its own fleet, leading to better utilization of assets

Heartland continues to shrink its fleet. The company reduced its net PP&E from $667 million at the end of 2025 to $627 million (-$40 million) at Q1 to $571 million (another $56 million) at Q2.

This is necessary to regain profitability, and it frees up cash, but it also represents a reduction in earning power that must be recognized in our valuation.

Sales accelerated in Q2 as used Class 8 prices firmed, though sales also included an unspecified amount of real estate sales during the quarter.

Note that the roll-forward uses figures from the cash flow statement. The $25 million difference between the actual ending figure is, I believe, due to assets being moved into current assets while they’re sold (I have an email to the company to confirm this).

Here’s another look, this time at the capital employed calculation. We have seen the same effect since 2022, the year the company acquired Smith Transport and CFI.

Capital Allocation

On the plus side, Heartland used its positive cash flow to reduce debt and leases and return capital to shareholders via regular dividends and share repurchases.

Net debt is down to just $84 million at the end of Q2 2026 from a high of $384 million at the end of 2022. If operational trends continue, I wouldn’t be surprised to see Heartland with no net debt by the end of 2026.

Share Repurchases

The company spent $2.3 million buying back 172,061 shares during Q2 at an average price of $13.62, with most of the purchases made in May at an average price of $13.61.

To sum up the major capital allocation moves during the quarter:

• Shrunk its investment in PP&E by $56 million

• Spent $2.3 million to repurchase shares

• Paid $1.5 million in dividends

• Reduced debt/leases by $6.7 million

• Increased cash by $17.9 million

Valuation

Read more

In Case You Missed It:

Fed Report on Household Credit

“Boomer Candy” (WSJ)

Sounds like a free lunch to me. The downside protection has to come from somewhere. Future returns, most likely. Increased counterparty risk, perhaps. I don’t like it…

CRA Overall for Banks Under $10B Assets

The Book That Helped Bill Ackman Grow Howard Hughes Holdings

That book sounds familiar…

Additional Detail on Brooks’ Q2 Results

Buyback Tracker from Manana. I Love These Charts!

Housing Legislation Analysis

Construction Physics

How Will the 21st Century ROAD to Housing Act Affect Housing Supply? Part II

This is the second installment of my look under the hood of the recently passed 21st Century ROAD to Housing Act, looking at what each provision actually does and trying to suss out its actual impact on housing supply. You can read my previous essay on Title I of the Act…

Read more

a month ago · 54 likes · 3 comments · Brian Potter

This Week in Berkshire History

Nothing this week.

That’s it for this week. Hit reply and let me know what you think. What have you been reading that’s worth sharing? Let me know in the comments.

Leave a comment

Stay Rational!

Adam

Order the 2nd Edition Now!

Disclosure: Long BRKB

Valuation Update

Subscribers have access to the valuation model on Google Sheets, which includes a per-share valuation and earnings calculator.

High-Level Capital Allocation

Greg Abel is wasting no time putting his mark on Berkshire.

• $11.6 billion net purchases of stocks ($39.4 billion purchases less $27.8 billion sales)

• Growth capex of $3.5 billion

• Acquisitions of $9.7 billion, including $9.4 billion spent on OxyChem on January 2. The deal was technically arranged during Buffett’s tenure as CEO, but Greg should get credit as it fell under his purview as vice chairman of non-insurance operations.

• Share repurchases of $4.762 billion. Note that the cash flow statement shows $4.444 billion; however, this is only the cash outlaid for purchases during the period. The difference was settled after the quarter ended.

• These add up to about $30 billion or $6 billion more than the $24.3 billion operating earnings during the period.

• Total cash (including BNSF and BHE) declined $8 billion from $373 billion at year-end 2025 to $365 billion as of June 30, 2026. Cash fell from 31% of total assets to 29%, and Berkshire ended the quarter with a net cash position (including all BNSF and BHE debt) of -31%

Q3 Capital Allocation

But wait, there’s more…

• The figures above don’t account for the $6.8 billion Berkshire laid out for homebuilder Taylor Morrison on July 24, 2026. Nor does it account for additional buybacks that we can glean from the filing date share count.

• Berkshire had 1,427,140 shares outstanding as of July 29 compared to 1,431,693 as of June 30. This implies another 4,553 A-equivalent shares were repurchased during the month of July. At an average price of $745,000 per share, that’s another $3.392 billion.

• These two actions alone (not considering any additional repurchases) will likely consume most of Q3 cash generation.

Thoughts on Q2 + H1 Operating Results

• Overall, Berkshire had a good quarter, with operating earnings adjusted for forex coming in at $12.7 billion, or 5.2% greater than last year. On a TTM basis, operating earnings were 12.9% greater at $51.3 billion.

• Float increased to $177.5 billion.

Read more

In Case You Missed It:

Salt Batteries (WSJ)

Amazon’s Entry into LTL Shipping

Dan Carlin Alexander the Great - Part IV

h/t I listened to the first three of these in succession and can’t wait to dig into this one!

Why Boring Businesses Win - The fight against entropy.

This Week in Berkshire History

August 7, 2003: Berkshire acquires Clayton Homes for $1.7 billion.
August 7, 1998: Berkshire acquires Executive Jet Aviation (later changed to NetJets). August 8, 2000: U.S. Investment Corporation or USIC, parent of U.S. Liability, acquired.
August 8, 2005: The Public Utility Holding Company Act (PUCHA) repealed.
August 8, 2019: Berkshire invests $10 billion in an 8% preferred stock deal with Occidental Petroleum to assist it in financing the acquisition of Anadarko.

That’s it for this week. Hit reply and let me know what you think. What have you been reading that’s worth sharing? Let me know in the comments.

Leave a comment

Stay Rational!

Adam

Order the 2nd Edition Now!

Highlights

I can only tease this for non-subscribers given the size of the bank and relatively low liquidity (I may release the post at a later date).

• Offering will take some chips off the table for the founding family but still leave 47% insider ownership post-sale.

• Valuation is fair at 1.18x June 30, 2026 book value

• Five-year average ROA: 1.31%

• Five-year average ROE: 15.0%

• Net charge-offs average -0.02% since 2018 (meaning small net recoveries)

• 90% of loan book in CRE with concentration in multi-family

• Average LTV of 39%

• Tangible book value per share CAGR of 13.7% over 10 years

  

Disclosure: No position as of this writing.

Drumroll…

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In Case You Missed It:

Berkshire Hathaway Completes Acquisition of Taylor Morrison

Home Services 2026 Mid-Year Report (Summary)

Full Report Here

Mid-Year Property/Casualty Report

Prices down 20-25%

Deep Thoughts from Brian Cox

Brian is one of my favorite scientists. This really got me thinking about the preciousness of life.

Construction Physics

Why Is Everyone Trying to Build a Solid-State Battery?

A battery technology that’s getting a lot of attention is solid-state batteries, lithium-ion batteries that replace the liquid electrolyte with a solid material. Chinese battery manufacturer CATL alone had more than 1,000 people devoted to solid-state battery research as of 2024, and battery manufacturers like…

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a month ago · 150 likes · 6 comments · Brian Potter

This Week in Berkshire History

July 31, 2001: 90% of MiTek acquired for $400 million cash.

August 1, 2000: Justin Industries acquired for $570 million (all cash).

That’s it for this week. Hit reply and let me know what you think. What have you been reading that’s worth sharing? Let me know in the comments.

Leave a comment

Stay Rational!

Adam

Order the 2nd Edition Now!

Disclosure: Long PAM.LON

Highlights

• Flat revenue at £53.8 million (down 0.4%) masks a meaningful shift in the business

• Gross margin reached a 4-year high at 44.9%

• Operating profit fell 24% to £2.87 million. Operating margin fell from 6.5% to 5.0%.

• Net cash position (including all lease liabilities) of £1.05 million.

• Shares trade at a nearly 40% discount to book value and just 7.5x earnings.

FYE March 31, 2026 Analysis

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In Case You Missed It:

Jake Taylor’s Essay on AI (Long, But Worthwhile)

100-Ton Wave Energy Buoy

A Detailed View of Precision Castparts

AviationOutlook

Precision Castparts - Company Analysis and Outlook Report 2026 (Updated)

Executive Summary…

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5 months ago · Dipesh Dhital

More Behind NetJets’ First Fatal Crash

Lowering Construction Costs

Construction Physics

Can We Lower Construction Costs with Cheaper Labor or Materials?

Last time in our series on the nature of the construction productivity problem, we looked at economies of scale, finding that capturing economies of scale in homebuilding is difficult. Economies of scale primarily operate on the difference between the costs of the material inputs to some process and the cost of the fi…

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2 months ago · 123 likes · 14 comments · Brian Potter

A Look Into Berkshire’s Investment in Apple

Anomaly Investment Partners

Our Approach to Business Valuation

Most will agree that, to do well in investing, a basic requirement is to invest in businesses at a lower price than what they’re worth, or than their intrinsic value. The idea is simple enough: if something is worth 100 and sells for 60, then we have an investment opportunity. The selling price is always easy to find. The intrinsic value of the business…

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2 months ago · 5 likes · 1 comment · Anomaly Investment Partners

This Week in Berkshire History

Another quiet week in Berkshire’s history.

That’s it for this week. Hit reply and let me know what you think. What have you been reading that’s worth sharing? Let me know in the comments.

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Stay Rational!

Adam

Order the 2nd Edition Now!

Disclosure: Long HIFS.

Q2-2026 Updates

Hingham released its Q2 earnings last Friday and its 13F on Monday.

The bank continues to make meaningful progress returning to a normalized level of profitability.

• Q2 annualized core ROA and ROE were 0.94% and 8.55%

• H1 annualized core ROA and ROE were 0.94% and 8.60%

The positives:

• Continued net interest margin expansion driven by impressive growth in noninterest-bearing deposits

• Continued overhead discipline

• Resolution of a Washington, DC loan relationship and progress on another

• Changes to the investment portfolio, including a new position in a bank, elimination of another bank holding, and reduction in Alphabet

The negatives:

• Two one-time, non-recurring expenses

• Additional reserves booked against the large WMA project

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In Case You Missed It:

I was on two podcasts last week:

Full Warren Buffett CNBC Interview

How America Got Its Banks

Jamie Dimon Interview

A $1.2 million Dam - Built By Beavers

Robert Miles on Talking Billions

Bogumil Baranowski's Substack

Robert P. Miles: What 20 Berkshire CEOs Taught Him About Character, Inside the Temperament, the Moat, and the Culture that Keep Compounding

Robert P. Miles is an author, educator, and the world’s foremost authority on Berkshire Hathaway’s management culture. Robert has written three bestselling books on Warren Buffett, created the only graduate MBA course dedicated to Buffett’s philosophies, and founded the Value Investor Conference in Omaha. His journey from an entrepreneur to a globally r…

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2 months ago · 1 like · Bogumil Baranowski

This Week in Berkshire History

July 17, 2018: Berkshire’s board of directors authorizes an amendment to the share repurchase program, allowing purchases if Buffett and Munger believe the shares to be undervalued, conservatively estimated.

That’s it for this week. Hit reply and let me know what you think. What have you been reading that’s worth sharing? Let me know in the comments.

Leave a comment

Stay Rational!

Adam

Order the 2nd Edition Now!

Disclosure: None

Revisiting BKSC

I first looked at BKSC in February 2023 (original analysis).

It recently came back on my radar, and I decided to take a cursory look to see what had changed over the past three years.

The stock price hasn’t gone anywhere over that time and, in fact, is down 12% over the past five years. Today’s market cap of $88 million is essentially unchanged from $92 million three years ago. In terms of the business…

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