Buffett’s Berkshire Hathaway Reaches $1 Trillion Market Value Milestone
Berkshire Hathaway Inc., Warren Buffett’s renowned conglomerate, has become the first non-tech U.S. company to surpass the $1 trillion mark in market value. Shares of Berkshire rose by as much as 0.8% on Wednesday, pushing its market capitalization over the trillion-dollar threshold for the first time. The stock has seen a robust rally this year, fueled by strong performance in its insurance sector and growing economic optimism. This achievement places Berkshire in an exclusive club of companies, mostly dominated by tech giants such as Alphabet Inc., Meta Platforms Inc., and Nvidia Corp.
“Berkshire has done it the slower, but more sure, way,” remarked Steve Check, founder and chief investment officer of Check Capital Management, which oversees about $2 billion in assets, with Berkshire as its largest holding. “It’s harder to make money the old-fashioned way.”
Berkshire’s impressive stock rally this year has outperformed the S&P 500, making it one of the company’s best annual starts in a decade. In 2024, Berkshire’s shares have climbed 30%, compared to the S&P 500’s 18% increase. This growth keeps it within reach of the so-called “Magnificent Seven” — a group of leading tech stocks that have gained 35% this year.
Buffett has spent much of his life transforming Berkshire Hathaway from a struggling textile manufacturer into a vast business empire. He achieved this alongside his longtime business partner, Charlie Munger, who passed away in November at the age of 99. From 1965 to the present, Berkshire’s market value has grown at an annual rate of about 20%, nearly double that of the S&P 500 over the same period. This remarkable growth has cemented Buffett’s status as one of the world’s wealthiest individuals and a legendary figure in investing.
Berkshire’s strong market performance coincides with rising economic optimism, as expectations grow for the Federal Reserve to cut interest rates at its September meeting. Additionally, consumer confidence reached a six-month high in August. Berkshire’s diverse portfolio includes businesses ranging from truck stop operator Pilot Travel Centers LLC and ice cream chain Dairy Queen to battery brand Duracell.
This year alone, Berkshire has added more than $200 billion to its market capitalization, a record for the company. However, this achievement is still overshadowed by Nvidia’s nearly $2 trillion increase in market value. Berkshire’s recent rally has pushed its stock into overbought territory, according to the relative strength index, prompting some caution among market analysts.
