- Semper Augustus with an annual update on Berkshire (among other things) suggesting an IV of $265
- A thoughtful valuation of Markel suggesting an IV less than $1000.
As outlined in my first post on MKL, I use three different valuation methods.
The first (most conservative) method gives me a value of $834 by using the leverage ratio (2.1) to determine an appropriate P/B ratio (1.28) to apply to BVPS ($654).
Modeling three separate units using updated numbers for premiums ($7864), invested capital ($19,238), Ventures EBITDA ($170) gives me a value of $1165.
Finally, the two column method, which is the most aggressive method, adds the net investments/share ($1168) with a suitable multiple to capitalize Ventures earnings (~$100) to arrive at $1266/share.
The average of these three is $1,090. An 80% discount would imply a buy price of around $900. Note that the IV seems to have fallen by about 10% since the last valuation.
Objectively, 2018 was not a good year for MKL. and 12/31/2018 may be a bad day to measure BVPS; its probably up meaningfully since the last reckoning.