Markel's cost of float, like Berkshire's, is negative. Image by DonkeyHotey via Flickr Creative Commons, Every investor dreams about owning the next Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B) , as the. This makes Markel similar to how Berkshire Hathaway (NYSE:BRK.A) (NYSE:BRK.B) operates, in that Berkshire Hathaway also owns an array of privately-held businesses. This expanded their investment portfolio size from just $9.3 billion to $17.6 billion. The company has a structure which is fairly similar to Berkshire Hathaway and has a stunning track record of compounding its business over time. Berkshire Hathaway and Markel are both one-part "active mutual fund". Lawrence A. Cunningham is a professor at George Washington University, longtime shareholder of Berkshire Hathaway, and publisher, since 1997, of The Essays of Warren Buffett: Lessons for Corporate America. The Motley Fool owns shares of Berkshire Hathaway, Loews, and Markel. Berkshire's price to book we know should be higher over the next 10 years in a rational market given that IV is growing slightly ahead of book value per share. They write insurance and invest the float. If you’ve never been to the Berkshire Hathaway (BRK-A, BRK-B) annual meeting, make it a priority—and include a virtual visit this year. Markel builds the next Berkshire Hathaway in the Richmond area Diamond Healthcare Corp.: . Markel Corporation has been discussed frequently on this website not because the company might be the “next Berkshire Hathaway” but because management has consistently adopted many of Mr. Buffett’s principles in substance while retaining their own unique style of operations. Berkshire Hathaway needs no introduction, but what many investors might not know is the existence of several “Mini-Berkshires” or “Baby-Berkshires”, companies that are much smaller but in many ways similar … Softbank is trying to be the Berkshire of tech and has managed to create a nearly 100B VC fund that is buying things left and right. If you couldn't attend, you can still follow up on the weekend's festivities as reported on Twitter: #BRK2012. Its insurance business is profitable despite a challenging quarter, and the ventures segment has shown strong growth. And Markel’s largest holding may be Buffett’s own Berkshire Hathaway (898 Class A shares valued at about $91 million and 31,418 Class B shares, worth about $106 million). Its insurance business is profitable despite a challenging quarter, and the ventures segment has shown strong growth. Nor do Markel shares trade in the stratospheric levels as Buffett's Berkshire Hathaway. This model has confirmed profitable, as Markel’s complete return over an prolonged time period has outpaced that of the S&P 500. This strategy has worked well for Markel over an extended period of time, and Markel has outperformed the S&P 500 over a 25-year period. Markel shares have returned 127% over the past 10-years, slightly below Berkshire's 160% gain, but a healthy outperformance of the S&P 500's 81% gain. Is Markel Corporation (MKL) The Next Berkshire Hathaway Inc. (BRK.B)? Markel has all the elements that made Berkshire great: A … Published on April 30, 2013 at 1:24 pm by The Motley Fool in News Share Tweet Email There will be no new Berkshire. Image above shows how well Markel have perform against the S&P and Berkshire Hathaway. Valuation. Disclosure: as noted above, I own shares of Berkshire Hathaway (BRK.B) and Markel (MKL) personally, but don’t own any of the other stocks mentioned above. Last Updated on March 6, 2021 by Oddmund Groette. Markel has a differentiated model of investing its retained cash flows into different firms, thereby making it just like how Berkshire Hathaway operates. Liberty Media and John Malone SUMMARY Markel is a diverse financial holding company serving a variety of niche markets with their principal business in the underwriting of specialty insurance products. They have a huge insurance arm that nearly doubled in size in 2013 with the purchase of Alterra. It’s no wonder that investors are ever watchful for “the next Berkshire Hathaway.” (And it’s why this headline always works). At $530.0 billion in market cap, rival Berkshire Hathaway can’t continue growing at the rate it once did–it’s simply too big. Need to Know This FAANG stock looks like the next Berkshire Hathaway — a smart bet for the next 25 years Published: July 26, 2018 at 10:46 a.m. Editor's Note: Berkshire Hathaway's annual meeting convened on May 5, 2012. Berkshire Hathaway’s holdings could surge as the economy continues to … Investing Management (Tom Gayner) The investment portion of Markel is… The Next Berkshire Hathaway? It’s always an intriguing question, isn’t it? In my study of 100-baggers since 1962, Berkshire Hathaway came out on top. But Markel stock is the highest priced on the Richmond index, trading for about $380 a share. Berkshire Hathaway often does the remarkable and makes money on its float. Markel has seen tremendous growth throughout the years by copying the business structure of Berkshire Hathaway. Markel Corporation (NYSE:MKL)’s market cap is just over $5 billion, less than 2% of the massive Berkshire Hathaway Inc. (NYSE:BRK.A). Valuation metrics suggest that the shares are undervalued at the moment. Share Tweet Email Page 1 of 2 Clearly Markel is a great candidate for the next Bershire Hathaway. The baby Berkshire. Though there may never be another, it’s fun to think about what made Berkshire such a success and to try to find similar set-ups. Markel has a differentiated model of investing its retained cash flows to buy other companies, similar to how Berkshire Hathaway operates. Experienced attendees, join in too. Markel has a differentiated model of investing its retained cash flows to buy other companies, similar to how Berkshire Hathaway operates. I think the highest rate of growth in book value per share you can hope for Berkshire Hathaway over the next decade is 10 percent. I expect the stock market to return no more than seven percent over the next decade. If the company continued to grow at the 20% clip, the business would be larger than the entire global economy in 15 years. Makels has had a long term total return of 4.52K % far outperforming Berkshire Hathaway. A contract manager, facilities developer and clinical service provider in behavioral health,... ParkLand Ventures Inc.: . Try any of our Foolish newsletter services free for 30 days . Google's attempt to diversify with the conglomerate structure and Alphabet hasn't been nearly as successful as I'd have hoped, given that - aside from Waymo - the "other bets" have largely been disappointing. Berkshire's "fund" is managed by Warren Buffett (and to some extent these days, Ted Weschler and Todd Combs); Markel's "fund" is managed by the highly respected (though less well-known) Thomas Gayner. These 5 Stocks Could Be the Next Berkshire Hathaway Our contributors think these five stocks should produce steady, market-beating returns for years to come. Searching for the next Berkshire Hathaway is the investor’s equivalent of the quest for the Holy Grail. ET Owner and operator of manufactured housing communities in the U.S., based in Henrico. In other words, it makes good money on its float. W. R. Berkley Corp, in contrast, is only a fraction of Berkshire… by Chris Mayer. Berkshire Hathaway stock had a disappointing 2020, but the outlook for 2021 seems promising. Thomas S. Gayner in many ways is the Warren Buffett of the Richmond area. To get updates, including an invitation to his exclusive webinar during Berkshire Hathaway’s 2021 Annual Meeting, sign up here. Where others have mimicked Berkshire Hathaway, Markel Insurance may be a carbon copy. As a holding company, Markel operates in a very similar manner as Berkshire Hathaway. Markel (NYSE: MKL) is often referred to as a "Baby Berkshire" in reference to Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B), the massive conglomerate led by Warren Buffett.. One reason many investors make this comparison is because both Markel and Berkshire Hathaway are -- at least in part -- insurance companies that, like all such businesses, invest their float to earn a return. Prefer a different member of the long list of anointed “next Warren Buffetts?” Let us know with a comment below. 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