CaptainJJack

Riding the Rails: Why BNI Was Berkshire's Best Bet - And Vintage Buffett

Overpaid? Chinese Railroads?

I own BNI, and while I bought it at $74 - 80, I sure looked at it when it was over $100, and oil was at $130.

BNI has a relatively high P/B, at around 2.5, but the Chinese railroads have P/B north of 30! And, I would argue there is more than a little political risk involved.

As for Buffet being too old and past his prime, let's see, there are the Goldman warrants, the Preferreds he did with GE and Harley. There is the Wrigley deal, the Mars deal, and the rail car deal (I forgot the name of the family that sold to him) -- all in the last year.

I also own BRK. I don't think he's lost it.


On Nov 04 12:10 AM Mark Anthony wrote:

> My comment is Warren Buffet has good big picture view, bad timing
> and bad pricing. Every one in the world has known for two years that
> Warren Buffett loves railways. He openly talked about it more than
> two years ago. So why why he picks a time to pay nearly the higest
> price? Way over-paid.
>
> If he likes railway, Chinese railways are way much better play. The
> capacity of China's railways transportation is stretched tot he extreme.
> Whole America's railway system has excessive capacity that is idled.
>
>
> If he likes commodity and transportation play, he should be buying
> coal mines, and he should be buying dry bulk shippers. Both sectors
> are dirt cheap compare with railways.
>
> seekingalpha.com/autho...
>
> I am afraid Warren Buffett is getting too old to calculate relative
> valuations correctly. There are so many good under-valued assets
> around at dirt cheap price. Railway will be the last thing I will
> pick up. It's going to be good, but just not as good as other things.