Looks like a great company, but I'm not sure I buy a comparison to Berkshire. It's hard to run the Berkshire playbook while also buying back shares and increasing dividends every year. Unless I'm misunderstanding something, there is no free float being invested. Instead they are using their cash flow to diversify to other areas, which I don't think is much different from other financial companies.
Fair point. We are trying to make a clickable title, but I think this company is more like Berkshire Hathaway than not. They are a conglomerate with a single directional head at the top with a long track record of success without associating with Wall Street. Oh, and they are from Nebraska. Sure they don't have float but that is only one part of the Berkshire business (I get that it is important).
For sure. Again, not knocking it as an investment. Nelnet is clearly doing the right things. My only concern would be that, as it transitions to more of a bank, or more of a payment provider, it rerates down to where the regional banks trade, or where Global Payments trades (the most analogous comp in education payment software). Going from a 24 PE to 10 would be a serious contraction.
Looks like a great company, but I'm not sure I buy a comparison to Berkshire. It's hard to run the Berkshire playbook while also buying back shares and increasing dividends every year. Unless I'm misunderstanding something, there is no free float being invested. Instead they are using their cash flow to diversify to other areas, which I don't think is much different from other financial companies.
Fair point. We are trying to make a clickable title, but I think this company is more like Berkshire Hathaway than not. They are a conglomerate with a single directional head at the top with a long track record of success without associating with Wall Street. Oh, and they are from Nebraska. Sure they don't have float but that is only one part of the Berkshire business (I get that it is important).
For sure. Again, not knocking it as an investment. Nelnet is clearly doing the right things. My only concern would be that, as it transitions to more of a bank, or more of a payment provider, it rerates down to where the regional banks trade, or where Global Payments trades (the most analogous comp in education payment software). Going from a 24 PE to 10 would be a serious contraction.
I think P/E is misleading at the moment. Look at SOTP and book value. Financials division is definitely trading below book value at the moment