Opinions
Josh Brown, CEO, Ritholtz Wealth Management
Berkshire Hathaway Inc. (B)
BRK.B-N
DON'T BUY
Jun 20, 2025
Stock price when the opinion was issued
You might be interested:
"Expensive" in terms of price per share is actually becoming less relevant because you can now buy fractional shares through some of the discount brokerage platforms. He doesn't own, but would be comfortable doing so. Today's as good a day as any to buy.
Good investment? Yes. Buffet is retiring and will be missed. Many people have learned a lot of valuable and timeless investing lessons from him. Berkshire has done a great job of planning succession and governance well, so the successor will have a good start. If Greg Abel has the endorsement of Buffett, that's good enough for his firm.
Portfolio of robust and resilient businesses with wide, competitive moats, and demonstrated history of generating free cashflow and paying dividends. Don't read too much into the cash hoard. It likes to be cash rich and patient, so it can write the big cheques when opportunities come along when there's blood in the streets.
Sitting on $300B or so of cash. Some of that will have to be used to buy back his shares when Warren does depart. Such a huge conglomerate, that they have to make bigger and bigger acquisitions to move the needle on earnings. And they're not finding those right now.
Over time, you'll probably get a 10% compound annual return. Doesn't own it because unsure what will happen once Warren really leaves or dies.
More or less fair value on valuation. Ran up with market volatility, as it's always a safe haven. Buffett's retiring, end of an era. Greg Abel has the chops, an excellent operator. Excited to see how he'll use the cash balance and improve operations. Insurance stocks have pulled back, making this an attractive entry.
Great proxy for growth of the US economy. Will really benefit from trends of AI and electricity demand. No dividend.
Considered a growth company. Great job growing FCF per share over the last 50 years. Exceptionally well run. Buffett may be stepping back, but culture he's instilled for capital allocation and ethics will transfer to the next generation of leadership with Greg Abel.
Only concern is valuation, bit rich. Becomes increasingly difficult for large companies to allocate capital at high rates of return. Forward rate of return is probably high single-digit or low double. An 8-10% rate of return is strong in his view. High-quality and predictable business. Many have done poorly betting against it.
Extremely well run. Shares pulling back from highs once Buffett announced retirement. Share price at 200-day MA, an inflection point. You have to understand that it's a fairly concentrated conglomerate of companies, including AAPL (though position was trimmed). Value strategy, which does well in time of uncertainty and higher interest rates; not so much when growth is on the boil with S&P being driven by tech.
Likes it long term, but big overhang on new management right now. If drops below 200-day MA, investors need to pay attention. Also tied to your outlook on AAPL.
P&C insurance is very defensive, so it draws crowds when people get panicky in the market and the price gets bid up. Has become too inefficient as it's gotten bigger. Instead, he'd prefer some of the US private equity names for the capital levers they can pull, which have similar business models.
Warren Buffet, in his annual letter, said that when he retires, he will just buy the S&P 500. This is not bad to hold in a taxable account, because this will compound and does not pay a dividend (so no taxes on that). He likes Berkshire, but won't be that different from owning the broad U.S. market.
Is -10% since May 3, but 18.5% this year. They sold but still own lots of Apple shares (2%). BRK did no buying or selling last month. Apple's weakness isn't helping BRK. Insurance is a great space during a risk-off market, but we're not in that market now.