Analysis July 22, 2024

Berkshire Hathaway: enduring value

Berkshire Hathaway is the closest thing in public markets to a "do nothing and compound" position. Its current portfolio plus operating businesses still trades at a reasonable price/book, and the cash pile gives optionality the next time markets get cheap.

What I like

  • Diversified franchise: insurance + railroads + energy + a public-equity book topped by Apple.
  • Capital allocation discipline — buybacks only at sensible prices, big positions trimmed when valuation gets stretched.
  • $300B+ in cash and short-term Treasuries earning 5%+ — a hedge against any drawdown.

Why I don't hold it

Personal preference: I'd rather size up a leveraged Nasdaq position and accept the volatility than own a low-beta diversified holding. But for someone targeting "S&P-like or better with lower drawdowns", BRK remains one of the cleanest single-name choices.