Professor Glen Arnold

We’ve already established (in the last two newsletters) that TClarke’s (LSE:CTO) shares are priced low relative to earnings through the economic cycle, and that the company is unlikely to suffer from financial distress (unless things go very wrong with the pension deficit).  Today I want to examine its competitive position with a particular focus on […]

We have already established that TClarke’s shares (LSE:CTO) are lowly priced relative to the earnings per share it has produced when averaged over the last 13 years (see Thursday’s Newsletter).  But Mr Market is obviously nervous about this company so we need to check a few more things to establish if that hesitancy is justified. […]

I bought TClarke (LSE:CTO) in November 2015, a time when it was still struggling to get over the construction industry recession.  Back then it had many unprofitable legacy contracts for the installation of the electrical and mechanical parts of buildings: prices in the industry had been held down by competing sub-contractors too keen to maintain […]

Laura Ho, Staff Writer, from the leading investment magazine in Taiwan is preparing an article(s) to coincide with the launch of my Warren Buffett book in Taiwan, HK and Singapore (in Chinese).  I’ve already done an interview but she asked supplementary questions.  You might find something useful in my answers so I’ve cut and pasted […]

Now that we are up to date with the GEICO story – but definitely not at the end of the story:  it still has a great future ahead of it – it is useful to remind ourselves of the key lessons Buffett learned or reinforced through this experience, and, by extension, what we can take […]

Despite Buffett’s standard non-interventionist stance when it comes to interacting with his managers he can sometimes become so excited by an idea that he encourages his managers to implement it. Such was the case with credit cards for GEICO customers.  After all, the company already had contact with millions of car owners, data on the […]

The vast majority of managers who come into the Berkshire Hathaway fold never leave, except through illness or retirement (often long delayed).  These people are usually multimillionaires and so do not need to work.  However, they feel valued by Buffett and Munger.  They feel part of a larger family of likeminded people.  They feel that […]

Even great businesses take the wrong path from time to time, and in the early 1990s the senior managers at GEICO stumbled.  Yet again, they saw visions of things being better on the other side. Thus they expanded away from their core competitive advantage in auto insurance with a low cost distribution model, into aviation […]

Lou Simpson, like his friend Warren Buffett, developed his investment approach through trial and error, evolving over decades.  Certainly, earlier in his career, long before being hired by GEICO, he was a “growth investor” often failing to properly consider whether that growth was being offered at a reasonable price.  He was aiming for a spectacular […]

GEICO is probably the best investment Buffett ever made. Much of this success is linked to what we looked at in the last newsletter: the terrific performances coming from the underwriting side of GEICO’s business.  But what turbo-charged the return for Berkshire Hathaway was the amazing amount of wealth creation generated by the person in […]