News about Berkshire Hathaway

In an early-May CNBC interview, Warren Buffett answered “Yeah” when asked whether stock prices were too high, saying many things would look very silly. From May 1 (7,230.12) to Oct. 15 (7,744.06), the S&P 500 rose 7%. Even so, Berkshire Hathaway became a net buyer of stocks in Q2 for the first time in three and a half years, buying about $23.5 billion while selling about $3.7 billion, and it bought back $4.5 billion of its own stock. It also invested in Alphabet, now nearly 13% of its equity portfolio, and in the recent IPO of Bending Spoons, with $600 million in July and $330 million in a private placement this month. The article notes Bending Spoons trades at 29 times forward earnings and will carry significant debt, so it is not a bargain in the traditional sense.

Berkshire Hathaway (BRK.B) returned 10.56% over the six months to October 15, versus 21.5% for the Insider Monkey Billionaire Index and 15.74% for the State Street SPDR S&P 500 ETF Trust. Since Greg Abel became CEO, the company invested about $10 billion in Alphabet in the second quarter of 2026, repurchased roughly $4.5 billion of its own shares and acquired homebuilder Taylor Morrison for about $6.8 billion. Its insurance float stood at approximately $177.5 billion at the end of June, and after 14 consecutive quarters as a net seller of stocks, Berkshire bought more equities than it sold in the second quarter. The company also invested $600 million in Bending Spoons' July IPO and $330 million more in October, lifting its stake to 4%. The article notes BRK.B's trailing P/E of 12.75x versus a forward P/E of 22.73x, attributes the gap to how investment gains and losses flow into reported earnings, and cautions against drawing conclusions from either figure alone.

Warren Buffett, who built Berkshire Hathaway into a $1.1 trillion company, handed the chairmanship to his son Howard and remains as chairman emeritus at age 96. In a 2014 letter, he said the chance of permanent capital loss for patient shareholders is as low as can be found among single-company investments, because intrinsic value per share is almost certain to advance over time. Greg Abel, a longtime Berkshire manager who has led its energy operations, was chosen as successor CEO, and Buffett said in his farewell letter that his expectations for Abel were sky high and have been exceeded. Buffett also said he has never felt better about what comes next. The article notes BRKB's forward P/E of 25.6 is above its five-year average of 21.2, and considers the shares reasonably valued or a bit overvalued.

The article argues that investors should not fear bear markets, citing Warren Buffett, who has invested through all market environments and beaten the market over time. During six decades as CEO of Berkshire Hathaway, he achieved a compounded annual increase of almost 20%, compared with about 10% for the S&P 500 over that period. During the 2008 financial crisis, Buffett wrote in The New York Times that bad news is an investor's best friend because it lets you buy a slice of America's future at a marked-down price. The article adds that the S&P 500 has historically rebounded after downturns and climbed significantly over the long run, so buying during declines and holding for years can be a sound plan.