Andrew Bary
Charlie Munger was the longtime chairman and effective chief investment officer for Daily Journal, a California legal publishing and software company.
Daily Journal stock could pique the interest of value investors after hitting an air pocket recently. The stock, which was up 0.3% Tuesday at $375.71, fell 10% Monday on no apparent news and now is off 33% so far this year.
The company now is valued at around $520 million, a small premium to the June 30 value of its marketable securities of $443 million. The portfolio, which was assembled by Munger, contains four publicly disclosed stocks: Alibaba Group Holding, Bank of America, Wells Fargo, and U.S. Bancorp.
That means investors aren't paying much for the Daily Journal's other businesses, notably a legal software business called Journal Technologies that had $41 million in revenues and about $5 million of pre-tax income in the first nine months of the company's fiscal year that ended on Sept. 30.
Munger, who died in 2023 at age 99, was chairman of Daily Journal from the late 1970s until 2022, when he gave up the chairman's role and remained a director until his death. He ran the investment portfolio, which accounts for most of the value in the company.
Munger was best known as the long-time vice chairman of Berkshire Hathaway, as well as a friend and advisor to its CEO Warren Buffett.
Munger generally deferred to Buffett at Berkshire's annual meeting, often saying "I have nothing to add" when Buffett answered shareholder questions. When he spoke, his tart comments on a range of topics -- such as Bitcoin, Robinhood Markets, and diversity, equity, and inclusion -- could delight Berkshire shareholders.
Munger took center stage at the Daily Journal annual meeting, often answering questions and holding forth for an hour or two.
Munger ran the Daily Journal portfolio and there was some overlap with Berkshire Hathaway's equity holdings. Bank of America is in both companies' equity holdings; Wells Fargo was a longstanding Berkshire investment until Buffett unloaded the stock in 2020 and 2021 in an ill-timed move at about a third of its current price.
Daily Journal held on to its Wells Fargo stake, which is now worth over $100 million. Bank of America and Wells Fargo account for the bulk of the value of the company's portfolio.
Together, Daily Journal's stakes in Alibaba Group Holding, Bank of America, Wells Fargo, and U.S. Bancorp are now worth an estimated $270 million -- and account for more than half of the company's marketable securities, with undisclosed investments making up the rest. Those investments could be foreign stocks.
Asked about undisclosed investments at the 2022 annual meeting, Munger replied that "we disclose what we have to" and that the company likes to keep confidential what it legally can, as does Berkshire.
Daily Journal was highlighted Monday on X by Ohio Capital Ideas, which is a private investor, investment analyst, and writer from Ohio, according to a profile on Seeking Alpha.
Ohio Capital Ideas posted that Daily Journal is trading for "30% to 40% less than the company's worth which is worthwhile but not generational or anything like that." Ohio Capital adjusted the marketable securities for deferred income taxes on the gains and a $25 million margin loan and came up with a value of around $400 million.
The company will provide updated portfolio information when it releases its earnings for the September quarter.
It's not easy to value the Daily Journal software business. Munger expressed optimism about it, saying at the 2022 annual meeting there was a "huge market" opportunity to streamline antiquated paper-based court processes. He did caution that the transition could come slowly. In his 2024 shareholder letter, Daily Journal CEO Steven Myhill-Jones noted that the software business's annual recurring revenues -- a key industry metric -- were $24 million last year.
"What excites me about the courts and justice agency sector is that I now believe more than ever that the market remains hungry for a modern software company that takes a long-term view towards delivering well engineered products and provides great service," he wrote.
What the company calls its traditional business, legal publishing, had $13 million of revenues in the nine months ending in June and operated at close to breakeven.
With the Munger involvement, some sought to compare Daily Journal to Berkshire, but the company rejected that idea.
"The Company is not a smaller version of Berkshire Hathaway Inc.," Daily Journal said in its 10-K. "The Company's goal is simply to continue to develop a successful and profitable software business, while continuing to enjoy the benefit of its Traditional Business for as long as possible."
Daily Journal is a far cry from Berkshire, but its discounted stock could appeal to value-oriented investors.
Write to Andrew Bary at andrew.bary@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
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October 28, 2025 13:57 ET (17:57 GMT)
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