Thai VI

คิดถึงบริษัทอะไรกันครับ มีข้อเหมือนและแตกต่างอย่างไร

อัญเชิญเซียนครับ

ผมไม่ใช่เซียนครับ แต่ขอตอบนะครับ เมื่อพูดถึง Geico ผมนึกถึง SMK ครับ เป็นบริษัทประกันภัยรถยนต์เหมือนกัน

ผมนึกถึง บ. ซิลค์สแปน ครับ บ. นี้ไม่อยู่ในตลาดนะครับน่าจะคล้ายกับ GEICO แต่อาจจะต่างกันเล็กน้อย
คือ บ. นี้จะมีหน้าร้านเป็นเว็บครับ และรับทำประกัน (นายหน้า) คอยส่งงานให้กับ บ. ประกันชื่อดังต่างๆ
กินค่าคอมฯ รวมถึงบัตรเครดิต และอื่นๆ (ร่ายไปร่ายมา รู้สึกว่าน่าจะตรงข้ามกันเลยนะครับ)
ส่วนในตลาด บ. แบบนี้ยังไม่เห็นชัดเจนครับ แต่จะมีก็แต่ TIP มั้งครับ ซึ่งฐานลูกค้าส่วนใหญ่ เป็นราชการ
และ รัฐวิสาหกิจ ช่องทางการขายหน้าเว็บยังไม่มีเหมือน บ.ซิลค์สแปน ซึ่งถ้าทั้ง 2 รวมร่างกัน ก็จะเป็น
GEICO ดีๆนี่เองครับ คือ ไม่ต้องเสียค่าคอมให้ใคร + ราคาจะถูกลง + ฐานลูกค้ามั่นคง แต่ข้อเสียคือ TIP
ยังมีกลิ่นไอของ ราชการ อยู่ครับ ซึ่งอาจทำให้หลายคนยังไม่มั่นใจเรื่องความรวดเร็วในการให้บริการนัก

มาจาก long run way..รันเวย์ที่ยาว
Post subject: Re: 10 Questions to Ask Before You Buy a Stock
http://board.thaivi.org/viewtopic.php?f ... 6&start=30

ทำไมลุงบัฟถึงบอกว่า นับblessing นับพรของเขา จะขอนับ GEICO 2 ครั้ง

1)
2012ar
When I count my blessings, I count GEICO twice.

GEICO led the way, continuing to gobble up market share without sacrificing underwriting discipline.
Since 1995, when we obtained control, GEICO’s share of the personal-auto market has grown from 2.5% to
9.7%. Premium volume meanwhile increased from $2.8 billion to $16.7 billion. Much more growth lies
ahead.

....





2)
source: กลับ 1950 โมเดล..
http://gregspeicher.com/?p=1368

“Point 1. Does the company have products or services with sufficient market potential to make possible a sizeable increase in sales for at least several years?”

As I have pointed out, Buffett’s 1951 article on Geico provides one of the clearest examples of an investment thesis that passes this test.

In his article on Geico, Buffett shows Geico’s track record of growth over the prior fifteen years: premiums written up 36% per year and policyholders up just under 30% per year, albeit from a small base. Then Buffett writes one of the most important sentences of the article and one that investors should focus on in their own analyses.

“Of course the investor of today does not profit from yesterday’s growth.”

It’s a simple sentence and a simple idea, but it encapsulates a great deal of wisdom. It’s the reason that investing can never be reduced to a spreadsheet or a database. It’s the reason why there is no substitute for thinking. As Buffett points out, it’s the reason that all librarians aren’t rich.

Buffett next lays out his case that Geico still had the potential for strong growth. He cites two areas of growth:

1) geographic expansion – prior to 1950 Geico operated in only 15 states,
and 2) increased market share in states where they already operated – they only had 3,000 policyholders in New York State.

Equally important, Buffett explains why Geico could expect to capture business in these markets. Geico had no agents or branch offices and could offer policies at discounts of up to 30% off competitors’ rates. These savings would be amplified in periods of recession and would be even more meaningful as Geico expanded in states where the cost of insurance was high, such as New York State.

You did not need an MBA or CFA to understand why the odds were stacked in Geico’s favor.

Geico also enjoyed excellent profit margins (Fisher’s Point 5 – “Does the company have a worthwhile profit margin?) and a formidable Chairman of the Board, Ben Graham, whom Buffett trusted completely (Fisher’s Point 15 – “Does the company have a management of unquestionable integrity?”).

..
3) model model

GEICO is a very interesting model. It's another one of the 100 or so models you ought to have in your head. I've had many friends in the sick business fixup game over a long lifetime. And they practically all use the following formula—I call it the cancer surgery formula:

They look at this mess. And they figure out if there's anything sound left that can live on its own if they cut away everything else. And if they find anything sound, they just cut away everything else. Of course, if that doesn't work, they liquidate the business. But it frequently does work.

And GEICO had a perfectly magnificent business submerged in a mess, but still working. Misled by success, GEICO had done some foolish things. They got to thinking that, because they were making a lot of money, they knew everything. And they suffered huge losses.

All they had to do was to cut out all the folly and go back to the perfectly wonderful business that was lying there. And when you think about it, that's a very simple model. And it's repeated over and over again.

And, in GEICO's case, think about all the money we passively made.... It was a wonderful business combined with a bunch of foolishness that could easily be cut out. And people were coming in who were temperamentally and intellectually designed so they were going to cut it out. That is a model you want to look for.

And you may find one or two or three in a long lifetime that are very good. And you may find 20 or 30 that are good enough to be quite useful.
http://ycombinator.com/munger.html

4. ปัจจุบัน Oct. 7, 2011
How GEICO Is Delivering Shareholder Value To Berkshire Hathaway
source:http://seekingalpha.com/article/298261- ... e-hathaway
GEICO spends more on advertising than its competitors.
ตอบโดย Mike Campbell, CFO of GEICO,
4.1 "The U.S. automobile insurance market is growing by only 1% per year. "
4.2 "Therefore, GEICO’s growth is coming primarily from attracting new customers from its competitors through its advertising campaigns and lower prices."
4.3 "1995, a year before GEICO was acquired by Berkshire Hathaway (BRK.A) (BRK.B), it spent $30 million on advertising. Currently, GEICO is spending $900 million per year on advertising {$30Mไป$900Mเพิ่ม30เท่าใน16ปี}

อ่านได้หน้า เดียว อ่น ต่อต้องไปเป็น สมาชิกเขา..แฮ่ะๆ

...
กาแฟหมดไปครึ่งถ้วย
...

5.)
ส่วนประวัติเต็มๆ
ตั้งแต่ ปู่เบน มาลุงบัฟ
ย้อน
ปี 50
ปี 70
จนกระทั้ง ปี 2012
ที่ market share 9%

By 2012, the growth at GEICO had been simply superlative under the Buffett-Nicely Murderer’s Row reign. Market share was up almost four-fold to 9.6%. Annual auto premiums had grown five-fold to $17 billion. Accumulated underwriting profit (pre-tax) clocked in at just over $10 billion. Gecko, GEICO’s reptilian ad man, plus the Caveman would make their debuts in 1999 and 2004, respectively. By 2012, these two pitchmen would happily spend approximately $1 billion each year hawking GEICO - or three times as much as the company’s three largest rivals combined. GEICO is on course to become the nation’s second largest auto insurer.

source

http://www.gurufocus.com/news/218282/ge ... sentation-

"spend approximately $1 billion each year hawking GEICO - or three times as much as the company’s three largest rivals combined"

ถ้าจำไม่ผิด เบน แกรม ก็ชอบ

รันเวย์ที่ยาว ผมตีโจทย์ไม่แตก

ถ้าตีแตก ผมถือตัวเดียวทั้งพอร์ตเลย

ขอแปะ

Becky Quick (CNBC): “If you could keep one company that Berkshire owns, either a wholly-owned subsidiary, or that Berkshire owns a common equity in, which one would you keep and why?”

Warren Buffett: “I would keep GEICO. It goes back to the -- 62 years ago it changed my life. It's also a wonderful company. I would have both things going for me, but that if I hadn't of gone to GEICO when I was 20 years-old and had a fellow there explain the insurance business to me, my life would be vastly different. So I just have to - - I'd have to choose GEICO.”

- CNBC interview March 13, 2013


Two of the greatest "Value" investors of all-time owe a substantial part of their wealth and public reputations – and deserved accolades - to a singular great “Growth” company, the Government Employees Insurance Company (GEICO). In the vernacular of investing, “Value” and “Growth” are most often associated with competing, mutually exclusive investing styles. It shouldn’t be so, but as a +27-year veteran in the investing “business” I can assure you that this investing-style division is deeply embedded in the investment management industry. Benjamin Graham’s deserved sobriquets include the “Father of Security Analysis” and the “Dean of Value Investing.” Of course Warren Buffett is known around the globe as the “Oracle of Omaha,” as well as Benjamin’s Graham’s “greatest” student.

Like many of us in our chosen profession, we sit on the shoulders of the greats. We hope to never stop studying and learning from the masters. I was ever fortunate to get hooked on the stock market my junior year in college in 1984. My Investments 334 professor introduced me to, and encouraged me to read about the likes of Benjamin Graham, John Templeton, Warren Buffett, Philip Fisher, John Maynard Keynes, etc. The guiding principles of our investment philosophy at Wedgewood Partners are the classic tenets of both “Value” and “Growth” investing.

Buffett’s evolving investment philosophy has oft been self-described as “85% Graham and 15% Fisher.” Charlie Munger’s “Growth” influence on Buffett deserves special mention on this score. Anyone who has studied the careers of either Graham or Buffett has surely come to recognize the notable influence and impact that GEICO has had on both of these masters. Indeed, the nearly fourscore history of GEICO is a barnburner tale of birth, incredible growth, tragic near-failure, unlikely rebirth and then incredible growth once again. GEICO may have bonded Graham and Buffett even more than their significant professor-student bond. The long history of GEICO offers students of investing plenty of lessons on of both “Value” and “Growth” investing. Dare I say that the investment lessons of the GEICO story alone are so poignant and instructive to apply to one’s own investment education that even a caveman can do it!

Government Employees Insurance Company

Leo and Lillian Goodwin founded GEICO in 1936. At the time 50 year-old Goodwin was an accountant at San Antonio-based United Services Automobile Association (USAA). USAA was founded in 1922 by a group of U.S. Army officers to self-insure each other’s automobile insurance. Apparently at the time, Army officers were considered reckless drivers. Goodwin’s brilliant insight was an expansion of USAA’s concept - bypassing commissioned insurance salesmen and selling low cost auto insurance through the mail at discounts of 30% to 40% directly to Federal, State and municipal government employees and certain categories of enlisted military officers, who statistically had lower claims than the public as a whole. The military list of potential customers would soon expand to include active and reserve commissioned officers and the first three pay grades of non-commissioned officers, plus veterans on active duty. Government defense contractors and faculty members of colleges and universities were soon solicited.

Goodwin founded GEICO with Ft. Worth banker Cleaves Rhea. Goodwin put up $25,000 in seed capital, Rhea and his relatives put up $75,000. Goodwin and his wife worked literally around the clock, twelve hours every day with nary a day off. On the weekends, Mr. Goodwin drove to military bases to pitch his car insurance to young service families. Their combined salary was $250 per month. Within their first year they had written over 3,700 policies and collected $104,000 in premiums. $27.62 for car insurance - ah, the good ‘ol days! In 1937 the Company’s operations were relocated to Washington, D.C. in order to be closer to the country’s largest pool of government workers.

By 1940 policies in force would grow to over 25,000 and premiums grew to $1.6 million, plus the Company had finally booked its first underwriting profit of $5,000 – 35 consecutive years of profits would then ensue. In the fall of 1941, a massive hailstorm descended upon the D.C. metro area damaging thousands of cars. Goodwin had the good business sense to quickly arrange with local auto repair shops to work around the clock exclusively for GEICO. In addition, Goodwin trucked in huge truckloads of auto glass. GEICO’s reputation for customer service left an indelible mark with the locals.

By 1946 and 1947, the Company was earning premiums of $2 to $3 million per year. Earnings per share of $1.29 in 1946 boomed to $5.89 per share in 1947. With the Company’s significant low-cost advantage, plus the emerging post-World War II automobile boom, the Company would go on to consistently post underwriting profit for the next 35 years in a row. The Company’s low cost advantage in their core automobile insurance offering would persist and endure for decades to come. Indeed, GEICO’s underwriting and loss adjustment expenses typically amounted to just 25% of premiums – at times 10-15 percentage points lower than their competitors, including such direct insurance writes as Allstate and State Farm.

Graham's journey with GEICO began in 1948. At the time the insurance industry was reeling from the sharp post-World War II inflation induced underwriting losses. In addition, the Rhea family was looking to sell part of their 75% of their ownership stake. After being spurned by larger investment houses, GEICO’s investment bankers and lawyers found their way to the Graham-Newman investment partnership. Graham was able not only to put aside his long-held disdain for insurance company investments, but then he did the inexplicable – he broke his own investment rules. Graham rarely allocated more than 5% of his investment portfolio to a single investment. Graham, breaking badly, so to speak, put 25% of his partnership in GEICO. Thus, in 1948 Graham’s investment partnership purchased 50% of GEICO for $712,000. Graham’s one-half purchased interest amounted to a purchase of 1,500 shares at $475 per share (a 10% discount to book value). Graham became Chairman of the Board. The investment banker in the deal (Lorimer Davidson) joined the company as part of the transaction - and would succeed the retiring Goodwin in 1958 as CEO.

Later in 1948, the SEC determined that an investment fund was not permitted to own more than 10% of an insurance company. The SEC demanded that the sale be nullified. The Rhea family refused to take their shares. In what would turn out to be a second stroke of luck for Graham-Newman, the SEC then ruled that the sale could stand as long as Graham-Newman shares were purchased directly by the partnership’s shareholders. The shares in GEICO were then distributed to the partners/shareholders of Graham-Newman in the summer of 1948 in the over-the-counter market. GEICO became a publicly traded stock. The original distribution was approximately $27 for one share of GEICO.

In 1949, the Company’s profits surged past the $1 million mark. As an example of the low-cost advantage wielded by GEICO, in 1949 the ratio to underwriting profits to premiums was 27.5%. The same measure for the 135 stock casualty companies as calculated by A. M. Best was 6.7%. By 1950, the Company had nearly 144,000 policies in force and $8 million in annual premiums – and licensed in just 15 states (and of course D.C.). In 1958, the Company’s addressable market more than tripled when they began to solicit nongovernmental, managerial, technical and administrative workers with the requisite outstanding driving records.

Over the next 25 years, GEICO would continue to grow, and grow… and grow. At the time of Goodwin’s retirement in 1958, an investment of $1,000 in GEICO had grown to $47,500. Graham and his colleagues would serve on the GEICO board for seventeen years. In 1965, Graham resigned from the board. In 1971, Jerry Newman retired. Newman nominated Warren Buffet to take his place on the GEICO board. Graham wrote the following recommendation to the board on Buffett’s behalf:

“…I am 100 percent for that idea. I have known Buffett intimately for many years, and I must say that I have never met anyone else with his combination of high character and brilliant business qualities. His record an investment fund manager is probably unequalled. In addition, I can recommend Warren as a good-humored, easy-to-get-along-with person, who can liven up your directors meetings. He would be sure to supply more than his share of worthwhile ideas for the benefit of the GEICO companies.”

By 1972, at the Company’s then peak operating level, a single original Graham-Newman share of $27 had grown in worth to $16,349 – not quite the classic single cigar-puff, textbook Graham and Doddsville stock. Graham-Newman’s original 1948 investment of $712,000 was worth over $400,000,000 25 years later. Graham had scored a Peter Lynchian 500-bagger. The gain in GEICO would come to represent a much larger percentage of the firm's profits than its other investments combined.The GEICO peak in 1972 would be short lived, and would not reach that level again over the next 10-plus years. Graham added the following postscript to the 1971/1972 edition of his seminal book The Intelligent Investor:

We know very well two partners who spent a good part of their lives handling their own and other people’s funds in Wall Street. Some hard experiences taught them it was better to be safe and careful rather than to try to make all the money in the world. They established a rather unique approach to security operations, which combined good profit possibilities with sound values. They avoided anything that appeared overpriced and were rather too quick to dispose of issues that had advanced to levels they deemed no longer attractive. Their portfolio was always well diversified, with more than a hundred different issues represented. In this way they did quite well through many years of ups and downs in the general market; they averaged about 20% per annum on the several millions of capital they had accepted for management, and their clients were well pleased with the results.

In the year in which the first edition of this book appeared an opportunity was offered to the partners’ fund to purchase a half-interest in a growing enterprise. For some reason the industry did not have Wall Street appeal at the time and the deal had been turned down by quite a few important houses. But the pair was impressed by the company’s possibilities; what was decisive for them was that the price was moderate in relation to current earnings and asset value. The partners went ahead with the acquisition, amounting in dollars to about one-fifth of their fund. They became closely identified with the new business interest, which prospered.

In fact it did so well that the price of its shares advanced to two hundred times or more than the price of the half-interest. The advance far outstripped the actual growth in profits, and almost from the start the quotation appeared much too high in terms of the partners’ own investment standards. But since they regarded the company as a sort of “family business,” they continued to maintain a substantial ownership of the shares despite the spectacular price rise. A large number of participants in their funds did the same, and they became millionaires through their holding in this one enterprise, plus later-organized affiliates.

Ironically enough, the aggregate of profits accruing from this single investment-decision far exceeded the sum of all the others realized through 20 years of wide-ranging operations in the partners’ specialized fields, involving much investigation, endless pondering, and countless individual decisions.

Are there morals to this story of value to the intelligent investor? An obvious one is that there are several different ways to make and keep money on Wall Street. Another, not so obvious, is that one lucky break, or one supremely shrewd decision – can we tell them apart? - may count for more than a lifetime of journeyman efforts. * But behind the luck, or the crucial decision, there must usually exist a background of preparation and disciplines capacity. One needs to be sufficiently established and recognized so that these opportunities will knock at his particular door. One must have the means, the judgment, and the courage to take advantage of them.

Of course, we cannot promise a like spectacular experience to all intelligent investors who remain both prudent and alert through the years. We are not going to end with J. J. Raskob’s slogan that we made fun of at the beginning: “Everybody can be rich.” But interesting possibilities abound on the financial scene, and the intelligent and enterprising investor should be able to find both enjoyment and profit in this three-ring circus. Excitement is guaranteed.

*Veracity requires the admission that the deal almost fell through because the partners wanted assurance that the purchase would be 100% covered by asset value. A future $300 million or more in market gain turned on, say $50,000 of accounting items. By dumb luck they got what they insisted on.

The Security I (Still) Like Best

Buffett entered the GEICO tale in 1950. While attending graduate school at Columbia University Buffett ran across an insurance filing that listed Graham (his professor and burgeoning mentor) as GEICO’s Chairman. Here Buffett's tells his story of that fateful visit in his 1995 Chairman’s Letter:

I've had a 45-year association with GEICO, and though the story has been told before, it's worth a short recap here. I attended Columbia University's business school in 1950-51, not because I cared about the degree it offered, but because I wanted to study under Ben Graham, then teaching there. The time I spent in Ben's classes was a personal high, and quickly induced me to learn all I could about my hero. I turned first to Who's Who in America, finding there, among other things, that Ben was Chairman of Government Employees Insurance Company, to me an unknown company in an unfamiliar industry.

A librarian next referred me to Best's Fire and Casualty insurance manual, where I learned that GEICO was based in Washington, D.C. So on a Saturday in January, 1951, I took the train to Washington and headed for GEICO's downtown headquarters. To my dismay, the building was closed, but I pounded on the door until a custodian appeared. I asked this puzzled fellow if there was anyone in the office I could talk to, and he said he'd seen one man working on the sixth floor.

And thus I met Lorimer Davidson, Assistant to the President, who was later to become CEO. Though my only credentials were that I was a student of Graham's, "Davy" graciously spent four hours or so showering me with both kindness and instruction. No one has ever received a better half-day course in how the insurance industry functions nor in the factors that enable one company to excel over others. As Davy made clear, GEICO's method of selling direct marketing gave it an enormous cost advantage over competitors that sold through agents, a form of distribution so ingrained in the business of these insurers that it was impossible for them to give it up. After my session with Davy, I was more excited about GEICO than I have ever been about a stock.

When I finished at Columbia some months later and returned to Omaha to sell securities, I naturally focused almost exclusively on GEICO. My first sales call on my Aunt Alice, who always supported me 100% was successful. But I was then a skinny, unpolished 20-year-old who looked about 17, and my pitch usually failed. Undaunted, I wrote a short report late in 1951 about GEICO for "The Security I Like Best" column in The Commercial and Financial Chronicle, a leading financial publication of the time. More important, I bought stock for my own account.

You may think this odd, but I have kept copies of every tax return I filed, starting with the return for 1944. Checking back, I find that I purchased GEICO shares on four occasions during 1951, the last purchase being made on September 26. This pattern of persistence suggests to me that my tendency toward self-intoxication was developed early. I probably came back on that September day from unsuccessfully trying to sell some prospect and decided despite my already having more than 50% of my net worth in GEICO to load up further. In any event, I accumulated 350 shares of GEICO during the year, at a cost of $10,282. At yearend, this holding was worth $13,125, more than 65% of my net worth.

You can see why GEICO was my first business love. Furthermore, just to complete this stroll down memory lane, I should add that I earned most of the funds I used to buy GEICO shares by delivering The Washington Post, the chief product of a company that much later made it possible for Berkshire to turn $10 million into $500 million.

Alas, I sold my entire GEICO position in 1952 for $15,259, primarily to switch into Western Insurance Securities. This act of infidelity can partially be excused by the fact that Western was selling for slightly more than one times its current earnings, a p/e ratio that for some reason caught my eye. But in the next 20 years, the GEICO stock I sold grew in value to about $1.3 million, which taught me a lesson about the inadvisability of selling a stake in anidentifiably-wonderful company.

Upon graduating from Columbia, Graham refused to hire his only A+ student in his 27 years teaching at Columbia - even for a salary of $0. (Buffett has oft quipped that Graham had perfectly calculated Buffett's true intrinsic value at the time.) So, from 1951 through 1954, Buffett tried his hand at being a stockbroker at his father’s small brokerage Buffett-Falk & Co. Finally, in 1954 Graham relented and hired Buffett as a security analyst at Graham-Newman. Buffett would then form the Buffett Partnership after leaving Graham-Newman in 1956.

Buffett’s hiatus from GEICO as an investor would last over the proceeding two decades, yet the Company’s fortune - and later misfortunes - were never far from his mind. The GEICO under Graham’s tenure would dissolve into a morass by the 1970’s. The Company’s unbridled growth had begun to sow the seeds of its demise. By 1974, the Company was reeling. The government had begun to legislate no-fault insurance and mandated price reductions. Concomitant with new regulations and inflation, the Company’s underwriting executives had made a series of egregious pricing errors extending its clientele to higher risk categories. Inadequate provision for future claims had raised their ugly head too. The Company was woefully under reserved. Thus began a stream of significant losses. In 1975, the Company lost $126 million and $40 million during the first half of 1976. Bankruptcy was a very real risk – and the Washington, D.C. insurance commissioner was poised to declare GEICO bankrupt. Buffett even interceded in 1975 with a visit to then CEO Norm Gidden. Yet inexplicably Gidden turned a deaf ear to Buffett’s entreaties and warnings. GEICO was on the brink of the largest insolvency in the history on the U.S. insurance industry.

The Company’s shares, which had traded as high as $61 in 1972 and $42 in 1974, were down to just under $5. By the time of the 1976 annual shareholders meeting at the Washington Statler Hilton, panic was in the air and pitchforks were drawn. Within a month, CEO Peck was booted. By then, the stock was little more than $2 per share. (A sad aside: The Goodwin’s had bequeathed their stock to their son Leo, Jr., who had margined the stock to the hilt. Tragically, after the stock crashed, he took his life.)

Enter the “The Babe Ruth of Insurance.” In May 1976, the GEICO board of directors hired former Traveler’s executive John Byrne as chairman, president and CEO. Byrne, brusque as they come, had recently cemented his industry chops at Traveler’s home and auto insurance lines. Byrne wasted little time in turning around GEICO’s operations. “Operation Bootstrap” commenced post-haste. Byrne was ruthless in cutting costs, increasing rates and re-underwriting the Company’s entire book of business. These measures included firing 4,000 of the Company’s 7,000 employees, closing 100 offices, exiting the Massachusetts and Jew Jersey markets and immediately raising rates by 40%. Byrne was also uniquely successful in putting together a consortium of 27 of the Company’s competitors to jointly reinsure GEICO’s existing book of business.

Byrne was so successful that GEICO’s statutory capital by the end of 1976 was back up to $137 million and the Company’s surplus topped $250 million – the highest level in the Company’s then 43-year history. GEICO returned to profitability in just one year. In the same year, 1977, the Company declared a dividend – just $.01. By 1979, the Company’s profits reached $220 million. Buffett’s Ruthian sobriquet of Byrnes proved quite fitting.

Shortly after taking the reigns at GEICO that May, Buffett reached out to his then dear friend Kay Graham, CEO of the Washington Post, to broker a meeting with Byrne. Kay Graham reached out to Byrne, yet Byrne apparently snorted, “Who’s Buffett?” The next phone call that Byrne received was from none other than Lorimer Davidson (who would live to 97 years of age) who’s choice and off-colored words quickly convinced Byrne to accept the Buffett meeting. Buffett and Byrne met long into the night at Kay Graham’s Georgetown residence discussing the intricacies of GEICO and Byrne’s plan for GEICO’s survival.

Buffett was so impressed by Byrne that he started buying GEICO stock the very next morning. The first order was for 500,000 shares at $2 1/8. Buffett opened up Berkshire’s thick wallet for even more. He ultimately invested $19 million in a Salomon Brothers led convertible preferred stock issuance of $75 million, plus $4.1 million at an average price of $2.55 per share. Buffett’s fully converted cost-basis was just $1.31 per share. Byrne was instrumental with Salomon in the convertible deal after eight other investment banks balked at the deal. Buffett played no small role himself parlaying his growing reputation to help sway insurance regulators at bay from pulling GEICO’s state licensees.

By 1980 Buffett had sized-up Berkshire’s investment in GEICO to $45 million (one-third of all of GEICO). By 1981, GEICO would represent 31% of Berkshire’s entire equity portfolio. (Shades of Buffett’s 1964 career score in American Express’ salad oil scandal.) At the close of 1982, Berkshire’s 35% ownership of GEICO represented approximately $250 million of annual insurance premiums – an amount larger than Berkshire’s own direct premium volume. As 1984 rolled around, GEICO continued to impress and accelerate. Berkshire’s GEICO ownership had reached 36%, and their interest in GEICO’s direct property/casualty volume of $885 million amounted to $320 million – more than double Berkshire’s own premium volume. 1985 would mark the peak of GEICO’s stock market value as a percentage (50%) of Berkshire’s common stock portfolio. Over the course of the next ten years, GEICO would prosper. Mirroring the Company’s rebirth of profitable growth, cash dividends would be increased for the next seventeen consecutive years. By 1994 the dividend would reach $1.00 per share. GEICO’s rising stream of dividends would buttress the coffers of Berkshire to the tune of $180 million dollars – more than four times Buffett’s investment in just dividends alone! Along the way too was Buffett’s growing desire to own GEICO lock-stock-and-barrel.

In Buffett’s 1987 Chairman’s Letter he informed Berkshire shareholders that GEICO, along with Capital Cities/ABC and The Washington Post would now be deemed “permanent” holdings. He wrote:

However, our insurance companies own three marketable common stocks that we would not sell

even though they became far overpriced in the market. In effect, we view these investments exactly like our successful controlled businesses—a permanent part of Berkshire rather than merchandise to be disposed of once Mr. Market offers us a sufficiently high price. To that, I will add one qualifier: These stocks are held by our insurance companies and we would, if absolutely necessary, sell portions of our holdings to pay extraordinary insurance losses. We intend, however, to manage our affairs so that sales are never required.

By year-end 1987, the incredible success of Buffett’s GEICO investment (15X bagger), The Washington Post (27X bagger) and the size of his Capital Cities/ABC investment had a combined market value of $1.7 billion – or approximately 75% of the net worth at Berkshire. The after-tax operating earnings growth at GEICO by 1987 had increased to $9.01, far eclipsing Buffett’s average stock cost of $6.67 per share. Fast forwarding to 1995, Berkshire’s marketable securities per-share over the previous thirty years had grown from $4 per share to $22,088 per share – a stunning compounded growth rate of 33.4%.

On and off again informal discussions of a Berkshire-GEICO combo had taken place for quite a few years; however, the first formal acquisition discussions would have to wait until late summer in 1994. Buffett had proposed a tax-free stock swap. GEICO executives Sam Butler and Lou Simpson balked at the proposal for dividend and tax-related reasons. The next proposal by Buffett (reluctantly) was a new issue of Berkshire convertible preferred. This proposal was nixed by GEICO on price. Negotiations continued into the spring and summer of 1995. GEICO countered that they would accept an all-cash deal at $70 per share. Simply put, GEICO wanted cash and Buffett didn’t have $2 billion in pocket change. While Buffett and Munger negotiated with GEICO on the east coast, events were stirring on the west coast.

The Magic Kingdom would soon turn Berkshire Hathaway (BRK.A)(BRK.B) into an even greater magic kingdom of its own. On August 1, 1995, Disney announced their acquisition of Cap Cities/ABC for $19 billion. At the time, Berkshire owned a cool 20 million shares of Cap Cities/ABC (13% of the Company). The cash portion of the deal was $65 per share (plus 1 share of Disney stock). Buffet’s $345 million investment in Cap Cities/Disney was now worth nearly $2.5 billion. Buffett’s elephant gun was now cash-cocked and he and Munger quickly agreed to GEICO’s $70 non-negotiable price. On August 25, brought the announcement of the GEICO acquisition. Buffett’s mentor once bought 50% of GEICO for $712,000 – Buffett upped the ante nearly 50 years later by $2.3 billion. From the real panic low’s set in the spring of 1976 of $2.25, by the fall of 1995, GEICO’s stock had soared to over $300 (split-adjusted).

By the end of 1995, Berkshire’s ownership in GEICO had increased to 51% via share buybacks. Buffett’s purchase of the remaining 49% in GEICO for $2.3 billion had thus created an effective 48-bagger on Berkshire Hathaway’s earlier GEICO investment of $46 million.

At the time of the GEICO acquisition, GEICO had grown to the nation’s 7th largest automobile insurer, insuring over 3.7 million autos. So now as a wholly owned subsidiary of Berkshire, Buffett gets his hands not only on GEICO’s underwriting profits, but also the Company’s growing float of $3 billion. Buffett on the GEICO acquisition (and a tutorial on float):

Since 1967, when we entered the insurance business, our float has grown at an annual compounded rate of 20.7%. In more years than not, our cost of funds has been less than nothing. This access to "free" money has boosted Berkshire's performance in a major way.

Any company's level of profitability is determined by three items: (1) what its assets earn; (2) what its liabilities cost; and (3) its utilization of "leverage" that is, the degree to which its assets are funded by liabilities rather than by equity. Over the years, we have done well on Point 1, having produced high returns on our assets. But we have also benefitted greatly to a degree that is not generally well understood because our liabilities have cost us very little. An important reason for this low cost is that we have obtained float on very advantageous terms. The same cannot be said by many other property and casualty insurers, who may generate plenty of float, but at a cost that exceeds what the funds are worth to them. In those circumstances, leverage becomes a disadvantage.

Since our float has cost us virtually nothing over the years, it has in effect served as equity. Of course, it differs from true equity in that it doesn't belong to us. Nevertheless, let's assume that instead of our having $3.4 billion of float at the end of 1994, we had replaced it with $3.4 billion of equity. Under this scenario, we would have owned no more assets than we did during 1995. We would, however, have had somewhat lower earnings because the cost of float was negative last year. That is, our float threw off profits. And, of course, to obtain the replacement equity, we would have needed to sell many new shares of Berkshire. The net result more shares, equal assets and lower earnings would have materially reduced the value of our stock. So you can understand why float wonderfully benefits a business, if it is obtained at a low cost.

Our acquisition of GEICO will immediately increase our float by nearly $3 billion, with additional growth almost certain. We also expect GEICO to operate at a decent underwriting profit in most years, a fact that will increase the probability that our total float will cost us nothing. Of course, we paid a very substantial price for the GEICO float, whereas virtually all of the gains in float depicted in the table were developed internally.


1_1367865907qGib.png
[ Enlarge Image ]


GEICO hit the ground running in 1996. Under the direction of 35-year GEICO veteran Tony Nicely (by 2012, maybe the most named Berkshire manager in Buffet’s annual Chairman’s Letter) – and with the influence of Buffett, GEICO quickly instituted a most effective and elegant company-wide bonus plan to enhance the company’s moat-like low-cost advantage. Henceforth, the annual profit sharing contribution and employee bonus plan would be calculated by two metrics – growth in voluntary auto policies and underwriting profitability on policies on GEICO’s books for at least one “seasoned” year. 1996 would turn out to be GEICO’s best year since 1976 as their voluntary auto policies grew 10%. The single best year during the previous twenty had been an 8% growth in policies. 1997 saw only accelerated growth on all fronts at GEICO. New voluntary policies clocked in at over 900,000 – nearly triple from 1993’s level of 350,000. Policies in force almost reached 3,000,000 – up about 50% from 1993. GEICO employees enjoyed a whopping contribution of 27% of their base contribution to their profit sharing plan. 1998 saw a dramatic increase to expand the gospel of GEICO’s low-cost auto insurance as the company’s marketing budget was increased to nearly $150 million – almost three times the amount spent in 1997.

Buffett didn’t let Tony Nicely take his foot off the gas pedal in both 1998 and 1999. The year before Buffett acquired GEICO; the company spent $33 million in marketing and had a force of 652 telephone counselors. By the end of 1999, GEICO spent $242 million in marketing and grew their counselors to over 2,600. GEICO’s growth went nearly ballistic. New annual auto policies grew nearly 1.25 million and 1.65 million in 1998 and 1999, respectively. Auto policies in force at yearend 1999 exceeded 4.3 million. GEICO’s market share had been stuck at about 2% the decade before Nicely took the reigns in 1993. At the end of 1999 it had quickly doubled to 4.1%. GEICO’s gain in market share had come at the expense of State Farm and Allstate. The year-over year growth of policies in force at State Farm has been flat since 2003. Allstate has fared even worse. Their cumulative policy in force growth has been -8% since 2008, and flat late since 2005. The table below chronicles the growth in GEICO over the next decade.

1_13678659077Q5v.png
[ Enlarge Image ]


Source: Rational Walk

By 2012, the growth at GEICO had been simply superlative under the Buffett-Nicely Murderer’s Row reign. Market share was up almost four-fold to 9.6%. Annual auto premiums had grown five-fold to $17 billion. Accumulated underwriting profit (pre-tax) clocked in at just over $10 billion. Gecko, GEICO’s reptilian ad man, plus the Caveman would make their debuts in 1999 and 2004, respectively. By 2012, these two pitchmen would happily spend approximately $1 billion each year hawking GEICO - or three times as much as the company’s three largest rivals combined. GEICO is on course to become the nation’s second largest auto insurer.

1_1367865907hql7.png
[ Enlarge Image ]


Near and dear to Buffett’s heart is float. By 2012, GEICO’s float had increased to $11.5 billion from 1995’s level of $3 billion. In addition, by 2012, GEICO’s underwriting profits had accumulated to $9 billion. How much of this float and profit over the years was then in turn invested into the likes of Coca-Cola? Although Berkshire holds a slug of Coca-Cola stock via GEICO’s float, we’ll never know the exact and full extent of the history of the Simpson-Buffet GEICO investments, but we do know that the totality of GEICO’s impact on Berkshire Hathaway have been manifold.

Buffett’s all in cost of GEICO on Berkshire’s books is about $2.4 billion. A comparable company is Progressive Corporation. GEICO and Progressive are similarly sized in both annual premiums written and policies in force. The market capitalization of Progressive is nearly $14 billion. We take Buffett on his word that when he states that the book cost of GEICO is a fraction of its economic worth.

Some may offer up Buffett’s investment in Coca-Cola as his greatest. They would have a compelling argument. By any measure, Buffett’s two and half-decade investment of $1.3 billion in Coca-Cola, currently worth just over $17 billion, certainly merits consideration. Throw in the not-so-minor matter of about $4.6 billion in accumulated Coca-Cola dividends since 1988 and perhaps the scale does tip in Coca-Colas’ favor over GEICO. Heck, the approximate flow of $3 billion in dividends from 1998 through 2011 certainly soothed the pain waiting for Coca-Cola’s stock to recover back to the 1998 exuberant highs of $33. Buffett’s current dividend yield to cost is a mind-numbing 34%. While Buffett’s investment in Coca-Cola is perhaps second to none for him in terms of raw size, the transformative nature of his GEICO investments, surely trumps Coca-Cola.

David A. Rolfe, CFA

Chief Investment Officer

"15 minutes could save you 15%"


[youtube]UPkCJTSqAj0[/youtube]




~~~
สรุปว่า
1. ถ้ามีโมเดลที่ทำให้
market share เพิ่มขึ้น จาก 2% เป็น 9% ได้ ในเวลายาวนาน {ขอตัดแค่ช่วงลุงบัฟGEICO’s market share had been stuck at about 2% the decade before Nicely took the reigns in 1993. At the end of 1999 it had quickly doubled to 4.1%. } 1993-2012 หรือ 19ปี ได้
แสดงว่า model นี้ wide moat deep moat ...
คำว่า long runway ..แปลว่า จาก 9% ไป 18% ยังอีก มาก


2. ใน
Post subject: 'Wide Economic Moat'
http://203.150.20.122/~thaivi/board/vie ... =1&t=52403
..
พูดถึง
e. in the economic downturn + still have plenty cash/earning + still widening moat
แปลว่า โมเดลของ Geico นั้น ไม่ใช้ตัวแทน agent ก็เลยถูกกว่า ขายตรง ว่า งั้น และยังมี auto renew
ลดต้นทุนต่ำ แถมเจาะกลุ่ม ความเสี่ยงต่ำ loss ratio - efficient

GEICO vs. Progressive: Selected Ten Year Metrics
Published on June 20, 2009 at 5:46 pm

Since Berkshire acquired full control of GEICO in 1995, the company has advanced from seventh to third position among auto insurers according to Warren Buffett’s latest letter to shareholders. (As an aside, Warren Buffett’s account of Berkshire’s purchase of GEICO in his 1995 shareholder letter is well worth reviewing.)

GEICO’s main competitive advantage is derived from its low cost operations which are made possible by the direct sales model the company uses to sell insurance policies. By selling products over the phone and online, significant efficiencies can be captured compared to a traditional agency distribution model. Progressive also employs a direct channel (although they also have a sales channel through independent agents) and the company has a strong long term track record.

While this article is not in any way a complete review of Progressive, I thought it would be interesting to compare GEICO and Progressive over a ten year period in terms of overall volume of premiums earned, underwriting results, and operating efficiency.

Ten Year Records

The following exhibit shows selected underwriting results for GEICO and Progressive over the past ten years:

GEICO vs Progressive


Both Progressive and GEICO show strong results by nearly any measure during this timeframe. GEICO’s compounded annual growth rate in premiums earned over the ten year period was 10.1% while Progressive grew at a 9.1% rate. GEICO’s average underwriting loss ratio was 75.8% while Progressive’s average loss ratio was a bit better at 71.4%. GEICO had the distinct advantage when it came to underwriting expenses with a ten year average of 17.8% versus 20.9% for Progressive.

...

Over the past two years in particular, we can conclusively see the benefits of GEICO’s low cost model. Despite having higher underwriting loss ratios in both years as well as lower levels of premiums earned, GEICO ended up with higher pre-tax underwriting profits due to significantly lower underwriting expenses compared to Progressive.

...

ได้ภาพชัดขึ้นยัง
(ถูก-ผิด ขออภัย ไว้ก่อน)

n the economic downturn
ยิ่งเวลาเศรษฐกิจไม่ดี .. model น่านี้จะยิ่งขายดีขึ้น..

แปลว่า เวลา econ
ไม่ดี คู่แข่ง moat แคบลง
แต่ Geico moat กว้างขึ้นลึกขึ้น

ดูเหมือน ตารางข้างบน ลืม link..
GEICO vs. Progressive: Selected Ten Year Metrics
http://www.rationalwalk.com/?p=2020

..

กลับมาที่
ad speding
ดูว่า Geico vs Progressive เป็นไง

1. Geico had spent about $994 million on advertising in 2011

2. Progressive spent $536 million

Buffett likes to say the Berkshire Hathaway unit can spend so aggressively because it keeps expenses low and can therefore advertise more to increase market share. The data showed, though, just how much more aggressive Geico is willing to be.

SNL found that Geico’s ad budget represented 6.5 percent of the premiums it wrote in 2011. Among the rest of the five largest auto insurers in the country, none spent more than 4.9 percent of premiums on ads. State Farm spent 1.7 percent of premiums on advertising.

For the whole industry, in fact, the average is just 2.4 percent.

[Allstate spent $745 million or 3.0 percent on advertising; Farmers spent $718 million or 4.9 percent and Progressive spent $536 million or 3.9 percent, according to SNL.]

Over the last 20 years, Geico’s share of the market has roughly quadrupled, for which the advertising program usually gets much of the credit.

source:
http://www.insurancejournal.com/news/na ... 252905.htm

ad speding
แก้
ad spending
งบโฆษณา

update ranking
at Q3/2013



source:
http://www.insurancejournal.com/news/na ... 314530.htm

ปรากฏว่า
พอกับไป อ่านทบทวน
หาที่สรุป
กระทู้นั้น
http://board.thaivi.org/viewtopic.php?f ... 6&start=30
มันยาวไป 8 หน้า หาไม่เจอ
จึงจะดึงเฉพาะส่วน geico มาแปะอีกครัง เด๊๋ยวนานไปยิ่งหาไม่เจอ
.........................

imerlot เขียน:กลับมาวิเคราะห์
เรื่อง วารีเอเบิ้ล ตัวแปร simple few controlable variables

source:
http://www.insurancejournal.com/news/na ... 314530.htm


1. จะเห็นว่า direct incurred LOSS RATIO %ของอุตสาหกรรมindustry 3Q อยู่ที่ 62.47-65.71
แต่ของ Geico สูงกว่า คือ 63.70-71.02 ความสามารถที่ว่า Geico มีฐานลูกค้าที่มีความเสี่ยงน้อยกว่า
เช่นเป็นกลุ่มลูกค้า government employee นั้นจึงไม่ชัด หรืออาจจะไม่จริง

2. yoy Premium change% แต่ Geico โตได้ 9.65-11.14 สูงสุดของทั้งกลุ่ม
ค่าเฉลี่ยอยู่ที่ 4.01-4.6 เรียกว่า โตชัดเจน สูงกว่า peer 2 เท่า
{บ. ยอดเยี่ยมในอุตสาหกรรมยอดแย่}

3. จาก1-2 สรุปว่า โต ไม่ได้มาจาก LOSS RATIO แต่มาจาก บ.ต้นทุนส่วนที่ไม่ใช่ LOSS RATIO ประมาณ 30-40% ได้ดีกว่า
โดยสามารถจัดสรร เป็น งบโฆณษณา ถึง 6.5% {Geico’s ad budget represented 6.5 percent of the premiums it wrote in 2011}ในขณะที่ อุตสาหกรรมใช้งบแค่ 2.4%{For the whole industry, in fact, the average is just 2.4 percent.} ใช้งบ3เท่าคู่แข่ง
ถ้าไม่เทียบกับ Progress ซึ่ง model คล้ายกัน กับ Geico. บ.อื่นๆเวลาได้รับ Premium มา 100 อาจจะต้องจ่ายไป10-15% ค่าคอมให้เอเยนต์ ทำให้ต้นทุนสูงกว่า Geico ผู้บราหารเน้นในขาดตัดต้นทุนส่วยภายใน บ. เพราะ controlable varible ส่วน LOSS RATIO uncontrolable จากยอดขายที่โตต่อเนื่อง market share เพิ่มต่อเนื่อง สรุปได้ว่า model นี้ ยังประสบความสำเร็จอยู่จนกว่า คู่แข่งจะปรับโมเดลตาม เท่าที่มีตอนนี้คือ Progress

4. free float growth
แน่นอน Premium รับโต 9.65-11.14% ทำให้กองทุน free float โตในระดับเดียวกัน
รายได้จากเงินลงทุนย่อมโตไปด้วย และจะมีใครเชี่ยวชาญสุดในโลกในการลงทุนขนาดยักษ์และยาว เม่าลุงบัฟกับลุงชาร์ลี ตอนนี้

http://board.thaivi.org/posting.php?mod ... &p=1616898
........................

imerlot เขียน:
ต.ย3
นักผ่าตัดโรคเมร็ง-ตัดเนื้อร้ายไม่ให้เหลือ

Model #3: The cancer surgery formula - a la GEICO.

Munger: GEICO is a very interesting model. It's another one of the 100 or so models you ought
to have in your head. I've had many friends in the sick-business-fix- game over a long lifetime.
And they practically all use the following formula - I call it the cancer surgery formula:

They look at this mess. And they figure out if there's anything sound left that can live on its own
if they cut away everything else. And if they find anything sound, they just cut away everything
else. Of course, if that doesn't work, they liquidate the business. But it frequently does work.

And GEICO had a perfectly magnificent business - submerged in a mess, but still working.
Misled by success, GEICO had done some foolish things. They got to thinking that, because they
were making a lot of money, they knew everything. And they suffered huge losses.

All they had to do was to cut out all the folly and go back to the perfectly wonderful business
that was lying there. And when you think about it, that's a very simple model. And it's repeated
over and over again.

..................................................................................................




http://board.thaivi.org/posting.php?mod ... &p=1617724

chaitorn เขียน:สรุปความของ อ. IMERLOT ครับ

สรุปถึงตอนนี้ทั้งหมด ซึ่งสะท้อนการลงทุนของ VI สาย บัฟเฟท ที่เน้นการลงทุนใน model ยุคของหุ้นที่เป็น Great Company โดยเริ่มมีการลงทุนที่ให้ความสำคัญในแนวทางดังกล่าวประมาณปี 1988 โดยมีการทดลอง Model ก่อนหน้าในการซื้อหุ้น Geico ในช่วงยุคแรกที่ใช้แนวคิดแบบ เกรแฮม ที่เน้นหนักเฉพาะหุ้นราคาถูกกว่ามูลค่าที่แท้จริง
โดยแนวคิดดังกล่าวมีประเด็นดังต่อไปนี้ที่เราได้คุยกันในหลายกระทู้

1. เราต้องมีความเชื่อก่อนว่า ผลของราคาหุ้นระยะยาว มาจากเหตุ และเหตุที่จะทำให้ราคาหุ้นในระยะยาวมีราคาสูงต่อเนื่อง และยั่งยืนได้ คือ พื้นฐานที่สำคัญที่สุดคือการทำกำไรที่สูงและต้องมีการเติบโตของกำไรอย่างสม่ำเสมอ ต่อเนื่องในระยะยาวด้วย จึงจะทำให้มูลค่าหุ้นที่แท้จริงในระยะยาวเติบโตตามไปเรื่อย ๆ ตามศักยภาพของการทำกำไรในอนาคตระยะยาว และทำให้เราสามารถถือหุ้นที่คัดสรรเชิงคุณภาพดังกล่าวในระยะยาวได้ เพราะมูลค่าหุ้นในระยะยาวมันยังเพิ่มสูงขึ้นด้วยตามเวลาที่เราลงทุน ซึ่งหุ้นหรือบริษัทที่เราคัดสรรจะต้องมีเคล็ดลับที่สำคัญคือต้องเป็นบริษัทที่มี moat หรือคูเมืองที่เข้มแข็ม ยิ่งคูเมืองฝังลึกในระยะยาวเพียงใด ยิ่งกันข้าศึกได้สูงมากเพียงใด และยิ่งสะท้อนกำไรที่เติบโตสูงต่อเนื่องในระยะยาวมากเพียงใด ก็จะยิ่งทำให้การลงทุนของเราหุ้นนั้นมี runway ระยะยาวให้เราได้ลงทุนต่อเนื่องระยะยาวได้ตามนั้นอีกด้วยโดยไม่ต้องเปลี่ยนตัวหุ้นลงทุนเหมือนยุคแรก ๆ เพราะพื้นฐานหุ้นในระยะยาวของหุ้นที่เราลงทุนมันไม่เปลี่ยนได้โดยง่ายนั้นเอง

2. พื้นฐานของหุ้นขึ้นกับ Business model ซึ่งไม่เหมือนกันแต่ขึ้นกับอุตสาหกรรมของหุ้นหรือกิจการที่เราลงทุนนั้นๆ สิ่งสำคัญที่เป็นตัวจำแนก หรือ ตัวกำหนดความแตกต่าง และเราต้องหาให้เจอ นั้นคือ Key Variable ที่เป็น Key success ของความสำเร็จขององค์กรนั้น ๆ ประกอบด้วย
2.1 ความสำเร็จของผู้นำธุรกิจในด้านต้นทุนที่ต่ำสุด ซึ่ง เราได้เห็น บริษัท commodity business เช่น บริษัทประกันภัยGeico มี model ธุรกิจแบบหมอผ่าตัดมะเร็งร้าย กล่าวคือ เป็นธุรกิจที่ตัด Logistics cost ที่ไม่จำเป็นออกไปให้มากสุด เช่น ไม่มีค่าcom ให้กับนายหน้าประกันภัยแบบการขายดั้งเดิมที่ผ่านตัวแทน ทำให้สามารถกำหนดราคาเบี้ยประกันภัยแบบลดสุด ๆ จนยากที่คู่แข่งจะแข่งขันได้ แม้ว่าบริษัทจะมีการโฆษณาสูงกว่าคู่แข่งขันหลายเท่าก็ตาม ซึ่ง Model แบบนี้ได้รับการพิสูจน์ให้เห็นถึงการเติบโตของธุรกิจที่ยาวนานได้ จนเป็นผู้นำในธุรกิจอันดับ 2-3 ในอุตสาหกรรมประกันภัย ตลอดจนเราได้เห็น Model ของ ธุรกิจปั้มน้ำมัน 2 แห่งที่ติดกัน ซึ่งจะพบว่าแม้จะเป็นปั้มน้ำมันแห่งหนึ่งที่วางกลยุทธ์ที่ดีมากจนลูกค้ามาใช้บริการมากขึ้น แต่คู่แข่งก็กลับไม่ตอบโต้ยอมให้ปั้มที่ติดกันขายได้ดีต่อเนื่องต่อไป
2.2 เราได้เห็น Business model แม้จะเป็น บริษัท commodity business ได้แก่ bnsf railway ซึ่งใช้โมเดล toll bridge สะพานเก็บค่าผ่านทาง ซึ่ง โมเดลนี้ ไม่ใช่ จะสำเร็จได้ง่าย ต้องเข้าปัจจัยสนับสนุนหลายอย่างที่เหมาะสม
2.3 เราได้เห็น Business model ซึ่งถือเป็น Superstock ที่เป็นบริษัทที่มี BRAND ระดับโลกที่เข้มแข็ง แบบ Coke ว่า ธุรกิจเขามี Runway ยาวขนาดไหน Key Variable ที่สำคัญของธุรกิจนี้อยู่ที่ ปริมาณการดื่มต่อคนต่อวัน ของประชากรโลก และการเป็นสินค้าที่สามารถขายไปทั่วโลกได้ โดยอาศัย Brand และ รสชาดที่อยู่ในใจของ คนหลายเชื้อชาติ หลายประเทศ จำนวนหลายพันล้านคน โดยการสำรวจพบว่า Brand ของ Coke มีมูลค่าสูงติดอันดับ 1-3 ในรอบ 2003-2013 และยังสามารรถขยายการจำหน่ายไปยังประเทศที่มีพลเมืองสูง ที่สะท้อนความสำเร็จของ coke ในประเทศจีน แม้ประเทศจีนจะได้ชื่อว่าเป็นประเทศที่ copy ผลิตภัณฑ์ได้ทุกอย่าง และเป็นสมรภูมิการแข่งขันที่รุนแรงมากของหลายธุรกิจ ซึ่งแม้แต่บริษัทธุรกิจของอเมริกาที่เข้าไปจำหน่ายในประเทศจีนก็ประสบความล้มเหลวมาแล้วจำนวนมากก็ตาม
2.4 เราได้เห็น Business model ของบัตรเครดิต คือ Model Closed Loop ซึ่งช่วยสร้างกำไรมากมายให้กับAMEX ที่ คุณ chaitorn ได้เปรียบเทียบแนวทางการดำเนินธุรกิจได้ชัดเจนว่า เหมือน IOS ของ apple นั้นเอง
แต่ยังมีจุดอ่อนของ AMEX ที่ต้องปรับปรุงโดยเฉพาะ Brand ซึ่งผลการสำรวจตกอันดับลงมามาก แต่ก็ยังอยู่เป็น top 20s Brand ชั้นนำอยู่
2.5 เราได้เห็น Business model ของ Well Fargo หุ้นธนาคารชั้นนำในอเมริกา ซึ่งอายุยาวนานกว่า 100 ปี แล้ว แต่ก็ยังสามารถพัฒนาจนใกล้เคียงกับธนาคารสมัยใหม่ ที่มี รายได้ non-interest income มากกว่า 40% และยังมีแนวโน้มการเติบโตของรายได้ส่วนนี้ เป็นเลข 2 หลัก หรือ double digit และ มีมูลค่า Port ของธนาคารที่สร้างรายได้จากการลงทุนกว่า 2แสนล้านเหรียญ ซึ่งมากกว่าบริษัท Berkshire Hathaway Inc ของ บัฟเฟทด้วย

3. เราได้ชี้ให้เห็นว่า พื้นฐานของธุรกิจที่สำคัญนั้น เราต้องดูปัจจัยสำคัญคือการเปลี่ยนแปลงของ พฤติกรรมผู้บริโภคให้ออก ซึ่งเป็นปัจจัยที่ชี้เป็นชี้ตายถึงความอยู่อยู่รอดของธุรกิจ ด้วยการวิเคราะห์ประเด็นสำคัญง่าย ๆ ดังนี้
3.1 เราอาจจะตั้งคำถาม และวิเคราะห์ให้ได้ว่าธุริกจนี้ในอนาคตจะมีความเสี่ยงต่อการเปลี่ยนแปลงในเรื่องอะไรที่จะทำให้ runway ของธุรกิจยาวขึ้น หรือ สั้นลง เช่น กล้องฟิลม์ มีความเสี่ยงจากกล้อง Digital จนทำให้ Runway ของ ธุรกิจไม่ยืนยาว แต่ธุรกิจงานศพ กลับมี Runway ที่ยาวนาน ไม่เปลี่ยนแปลง มันมีเหตุผลอะไรที่ทำให้เป็นเช่นนั้น นี่เป็นเหตุผลหนึ่งที่ทำให้ บัฟเฟท ไม่สนใจในหุ้นเทคโนโลยีหรือไม่ เพราะไม่เข้าใจความเสี่ยงในเรื่อง Runway ของธุรกิจนั้นเอง

4. ผู้ที่สนใจในธุรกิจธนาคารเก่าแก่ Well Fargo มีข้อแนะนำให้หาตัวอย่างการวิเคราะห์ ในหนังสือชื่อ Security Analysis ของปู่เบน เกรแฮมเจ้าพ่อ Value investor ท่านหนึ่ง ซึ่งในบทความของหนังสือนี้มีหลายเรื่องที่มีการวิเคราะห์มุมมองของธนาคารต่าง ๆ ในมิติต่าง ๆ ที่หลายคนอาจไม่เคยรู้มาก่อน จะทำให้เข้าใจมากยิ่งขึ้น

5. ในการซื้อหุ้นอย่างไรไม่ให้ขาดทุน เราควรรู้ว่า เส้นทางที่จะไปสู่การขาดทุนนั้น เป็นอย่างไรจะได้เข้าใจความเสี่ยงของธุรกิจที่เราจะคัดเลือก หรือลงทุนไปแล้วจะได้รู้ว่าจุดตายของธุรกิจอยู่ตรงไหน เมื่อรู้แล้วเราจะได้หลีกเลี่ยงเส้นทางนั้นเสีย ซึ่งเราควรจะศึกษา metal model ของลุงชาลีซึ่งมีหลายบทความที่พูดถึงการวิเคราะห์เรื่องดังกล่าวที่น่าสนใจไว้
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ตกหล่นหรือผิดตรงไหน
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มาแก้อีกทีแล้วกันครับ

http://board.thaivi.org/posting.php?mod ... &p=1617916

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imerlot เขียน:คุณ Mohnish บอกว่า
ลุงบัฟตอบว่า GEICO เพราะ runways is so long
นาที 1:05:39
moat is keeping wider n wider deeper n deeper
competiotor can not come up w any response
10% market share now
in a lifetime GEICO may be 1/3 of auto business
....
โอ้ว นึกว่า บ ประกัน ธรรมดาๆ
...
สงกะสัย Well Fargo คงมีอะไร stable แบบนี้ เหมือนกัน ถึงซื้อ เอาๆ
...

http://board.thaivi.org/posting.php?mod ... &p=1616624

...

imerlot เขียน: ...
ไม่เป็นไร วันนี้ จะอังกฤษ อินเดีย มาฟังกัน แบบเป็น นักเรียน columbia school เขาฟังเลย
https://cbs360.gsb.columbia.edu:8443/es ... 26360f1369
ผมยอมรับว่าฟัง echo360ไปสองรอบ แล้ว ก็ฟังไม่จบซักที
ถึงแค่ 1:08:53
...
เอาเรื่องสำคัญคัญสุดก่อน (แปลแบบลัดสั้น-แบบที่เข้าใจเอง เช่นเคย)
ใน Q&A session ประมาณ นาที 40ขึ้นไป ฟังไปเรื่อยๆจนถึง ประมาณ1:05:47
คุณ Mohnish Pabrai
บอกว่า ตอนเขาทานข้าว $650,100 กับลุงบัฟ
เขาถามลุงบัฟว่า "of all the business that you own which one is the most STABLE business?"
ภายใน 5 วิ
ลุงบัฟ บอกว่า GAICO
(ผมแอบนึกว่าเป็น coke อยู่ตั้งนาน)
.............


แต่จะกลับมาสนใจว่า
key word
STABLE business มันสำคัญไง?
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related linked
http://basehitinvesting.com/mohnish-pab ... -my-notes/

http://board.thaivi.org/posting.php?mod ... &p=1616607

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imerlot เขียน:คนนี้ทำสรุปไว้คล้ายกัน
more reading at
http://www.gurufocus.com/news/144627/gr ... -investing

The key cost and metric for evaluating GEICO can now be described as its advertising efficiency. Exactly the same is true for its arch rival Progressive. The moat has receded and the cost of defending its moat has increased as well.

http://board.thaivi.org/posting.php?mod ... &p=1616903


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imerlot เขียน:ต.ย.

ลองมาดูสัดส่วนของงบ ของ ALL
อันดับ 2-3 กัน
ว่า
1. loss-ratio กี่%
2. investment income กี่%
3. underwriting commision จ่าย กี่%

1.


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2.

....
http://board.thaivi.org/posting.php?mod ... &p=1616915

source:
http://www.marketwatch.com/investing/st ... financials

imerlot เขียน:ปี 2013 ALL

a.
1. รายได้รวม 34.19B เอาเป็นฐาน 100%
2. ซึ่ง มาจาก ค่า Prepium Earned 29.97B หรือ 87.65%
3. ซึ่ง มาจาก Total Investment Income=3.4B หรือ 9.94%


b.
4. เอา ค่า Prepium Earned 29.97B ตั้งเป็น ฐาน 100%
5. เอา Losses, Claims & Reserves 21.11B หารตัวฐานในข้อ4=70.43% LOSS RATIO{โดยประมาณเพราะอันนี้รวม reservesไว้ด้วย}


c.
6. เอา ค่า Prepium Earned 29.97B ตั้งเป็น ฐาน 100%
7. เอา Underwriting & Commissions 4B หารตัวฐานในข้อ6=13.34%
แปลว่าจ่าค่าคอมมิชั่นให้เอเย่นต์ ประมาณ 13.34%

d.
8. รายได้รวม 34.19B เอาเป็นฐาน 100%
9. Selling, General & Admin. Expenses & Other 8.4B หารตัวฐานในข้อ8 จะได้ 24.56%
ซึ่งในนี้ได้ รวม 4B ค่าคอมมิชั่นไว้แล้ว

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http://board.thaivi.org/posting.php?mod ... &p=1616919