Casey: Study Buffett, Tan, and Howley for capital allocation mastery
Mark Casey · Mark Casey (Capital Group): Public Market and Macro Perspectives · Jul 23, 2024 · at 22:41
Mark Casey, Partner and Portfolio Manager at Capital Group, recommends three public company CEOs as the ultimate exemplars of capital allocation discipline during an a16z Fintech event.
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“There's three people who I think are just the best. Warren Buffett at Berkshire Hathaway, obviously the GOAT, When he took over, ah, Berkshire Hathaway at 19 dollars a share 59 years ago, and now it's 641 thousand dollars a share, and it was all capital allocation, not R&D. But kind of closer to home for people who aren't gonna buy public stocks and insurance companies like Buffett did Hawk Tan at Broadcom, ah, has just done an un, unbelievably good job. When, his company went public at like four billion dollars in 2015 maybe and now the, you know, stock has gone from 16 to 1300 in 15 years, and the dividend now per share, 21 bucks, is more than the IPO price. All capital allocation. And the last one would be Nick Howley at Transdime, this aerospace components company. Same type of thing. 25 dollar stock to 1200 dollar stock. Paid a couple hundred different dollars of dividends along the way. And so, I would take those people, Buffett, Howley, Hawk Tan, read their annual reports, listen to their earnings calls, and Just try to figure out why they were so much better than everybody else, and that's what I try to do, and I think it's a learnable thing.”
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