Warren Buffett retired as Berkshire Hathaway CEO at the end of 2025 after compounding the portfolio at an average 19.7% a year over 60 years, versus roughly 10.5% for the S&P 500 and 11.8% for the Nasdaq Composite since 1971. His successor, Greg Abel, called him “arguably the greatest investor of all time” in the 2025 annual report. The author doubts Berkshire can sustain a 20% average annual return but still considers it a favorite stock, expecting it to outperform the S&P 500 over time because its businesses are well-run market leaders, its holdings are good values, and it tends to hold up well in downturns. Abel has already made several portfolio changes and holds a large cash pile, and he said in his shareholder letter that Berkshire's culture and values will guide his leadership. He expects that in 20 years the company will be even stronger, though returns may not be as high as before.
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