Munger Mode rating: 2 out of 5 — Sell. Our own rating from the research report below, on business quality first: moat durability and management, with price separating the top three.
Warren here, with Charlie looking over my shoulder. PG&E is a fascinating case study — a legal monopoly serving one of the richest territories on earth, trading at roughly ten times earnings while promising 9% annual growth. On the surface it looks like a dollar selling for sixty cents. But we've spent sixty years learning the difference between a business that looks cheap and a business that is cheap, and the difference usually comes down to one question: who controls the economics? At PG&E, the answer is not the shareholders, and not management. It's the California legislature, the CPUC, a strict-liability legal doctrine called inverse condemnation, and ultimately the weather. This company has been bankrupted twice in twenty-five years — once by regulators (2001) and once by a fire (2019).
Recent filings analysed: 8-K (2026-08-04), 10-Q (2026-07-23), 8-K (2026-07-23), 8-K (2026-06-23).
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