Berkshire Hathaway joins $1 trillion club

Warren Buffett’s Berkshire Hathaway reached a significant milestone on Wednesday. The company’s market value surpassed $1 trillion, placing it in an elite group of just seven companies with valuations over $1 trillion.   Most of the other trillion-dollar companies are in the tech sector. They include Apple, Nvidia, Microsoft, Google parent Alphabet, Amazon.com, and Facebook parent Meta Platforms. Berkshire Hathaway is a diverse conglomerate. Its portfolio includes insurance, energy, manufacturing, retail, and services businesses. Some notable entities under the Berkshire umbrella are Geico car insurance, BNSF Railway, Berkshire Hathaway Energy, Brooks running shoes, Dairy Queen ice cream, Ginsu knives, and the World Book encyclopedia. In the first half of the year, Berkshire’s operations generated $22.8 billion in profit. This was a 26% increase from the previous year. The company also has a large stock portfolio led by Apple. However, it has sold over half of its Apple shares this year.

Berkshire reaches $1 trillion milestone

These stock sales helped boost Berkshire’s cash and equivalents. They soared to $276.9 billion as of June 30, primarily held in U.S. Treasury bills. Warren Buffett, who turns 94 on August 30, has led Berkshire since 1965. Under his leadership, the company’s shares have gained more than 5,600,000%. This equates to an annual growth rate of about 20%, nearly double the annualized gain of the S&P 500, including dividends. Since 2006, Buffett has donated more than half of his Berkshire shares to charity, but he still owns more than 14% of the Omaha, Nebraska-based company. As of Tuesday, Forbes magazine estimated his fortune at approximately $144.9 billion. This makes him the world’s sixth-richest person. This year, Berkshire shares have risen 27%, while the S&P 500 has gained 18%. Reaching the $1 trillion valuation marks a significant achievement for Berkshire Hathaway. It reflects investor confidence in the company that Buffett has built over nearly six decades.