Tim Eriksen

Diamond Hill Investment Group: A Wounded Wildebeest?

Diamond Hill manages over $5.5 billion and you pick a tiny $50 million of their AUM (assets under management), in a sector that everyone knows has gotten creamed in the last year, and then based on its performance you draw generalized conclusions about the company as a whole.

Then you brilliantly look at YoY comparisons in EPS and find it falling despite rising AUM. Well if you were smarter you would have also seen how operating income rose YoY and that the lower EPS results were solely due to investment income incurring a loss, which is understandable based on how the market has performed so far this year. It is quite obvious that earnings power is continuing to grow at Diamond Hill.

Then you compare current performance to Buffett's historical performance. So you are using different timeframes in your comparison and in addition most of the time period for Buffett tracks changes in book value not investment performance (meaning it includes operating companies Berkshire owned). If that isn't comparing apples to oranges, I don't know what is.

Keep up the crappy work. I guess it just goes to show that anyone can get their thoughts published on the web these days.