Steven Check, founder of Check Capital Management Inc., a Costa Mesa registered investment adviser with $1.4 billion assets under management, for the 24th straight year attended Berkshire Hathaway’s famous annual meeting in Omaha, Neb., last month. Check and Jeremy Saltzberg, senior investment officer, spoke about Berkshire, their biggest holding. Their edited responses:
What did you learn that was different from prior years?
Each year seems similar but different. One huge change is attendance: from 5,000 people 24 years ago to more than 40,000 this year. Another: when Berkshire takes big positions—Disney 15 years ago, Apple in recent years—you see the CEOs in the audience. This year, Tim Cook was there listening to Warren Buffett and Charlie Munger.
You brought a group of 21. Were you the largest contingent from Orange County?
We probably were. Half of our group has gone before and half are newcomers. We make the newbies wake up early to wait in line for us; doors open at 7 a.m. We had one guy who got there at 3:30, so we got good seats.
Did you listen to the whole eight hours Buffett and Munger spoke? What tips did you glean?
I caught every word.
Because I’ve gone so many years, I’ve heard the questions and answers before, but there’s always something new. So, the question came up that Berkshire Hathaway stock has performed the same as the S&P 500 for the last decade, whereas it’s typically doubled the S&P. The takeaway is that even if Berkshire Hathaway performed the same as the S&P 500, it’s done it in a safer manner. I believe it will outperform the S&P 500 in a tougher market.
We also learned they signed a new 20-year lease. Buffett’s company will remain in Omaha and we heard a lot more this year from Greg Abel and Ajit Jain (potential successors to Buffett). We feel increasingly comfortable with the succession planning.
Are you buying or selling Berkshire after the meeting?
Berkshire has been our largest holding for a long time, one of 20 investments in our portfolio. We do change the size of our position sometimes. At the time of the meeting, the B shares were $218, an OK value. Recently they hit $202, which makes them a very good value. With fresh money, we’ll definitely be buying at $202.
Why go to the meeting when you can watch live on the internet?
If you had a chance to see Benjamin Franklin in person or watch him on YouTube, you’d go see him. It won’t last much longer. When you’re there, you’re among people who are like-minded about investing. It’s a lot of fun. You meet people from around the country. And it’s Omaha: there are a lot of excellent steak dinners. You have to make reservations three to six months in advance. All the hotels are already sold out for next year.
Are you going back next year?
It will be my 25th so I plan on it.
There’ll be no repeating Warren Buffett and Charlie Munger. That’s a once-in-lifetime deal and very funny. So the meeting is quite entertaining in addition to informative.
