Good morning and welcome to the final month of 2024. As AI adoption accelerated this year, the tech-heavy group of stocks known as the Magnificent Seven has often been in the spotlight. But the holding company Berkshire Hathaway is giving big tech a run for its money.
At age 94, Warren Buffett, chairman and CEO of Berkshire Hathaway, No. 5 in the Fortune 500, continues to keep the business world interested in what he is buying or selling. The firm's market cap reached above $1 trillion a few months ago, and it sits just beneath Tesla and above Taiwan Semiconductor. Yet, Buffett’s company is distinct for some of its holdings. Its signature property is Geico Insurance, and it also owns brands Duracell, Fruit of the Loom, Dairy Queen, and BNSF Railway that became household names more than half a century ago.
In a new Fortune article, my colleague Geoff Colvin writes that nine of the 10 most valuable companies traded on U.S. stock exchanges are tech firms led by Apple (No. 1) and Nvidia (No. 2), along with Microsoft, Alphabet, and more. And then—there’s Berkshire Hathaway. The firm’s market cap also beats those of all other non-tech companies. Walmart would have to get 41% more valuable, just to match Berkshire’s market cap, he explains.
“So far in this tech-infatuated year, Berkshire’s stock has outperformed the shares of Apple, Microsoft, and Alphabet,” Colvin writes. “It has beaten the tech-heavy Nasdaq as well as the S&P, the Dow, and the Russell 2000. It’s hard to remember that CEO Warren Buffett told his shareholders last February, ‘All in all, we have no possibility of eye-popping performance.’”
However, market capitalization isn’t Buffett’s favorite way of evaluating a company. “Market cap gauges the market’s expectations, not measurable financial results, and as Buffett often notes, Mr. Market has mood swings,” Colvin writes.
To learn about Buffett’s favorite financial metric, along with the business bromides he disdains, you can read Colvin’s complete analysis here.
Buffett, who has definitely created an investing legacy, recently became reflective about his life in a Nov. 25 letter to shareholders.
“Father time always wins,” Buffett writes. “But he can be fickle—indeed unfair and even cruel—sometimes ending life at birth or soon thereafter while, at other times, waiting a century or so before paying a visit. To date, I’ve been very lucky, but, before long, he will get around to me.”
Buffett revealed that he is distributing an extra $1 billion to his family’s foundations. This coincides with his longstanding pledge to give away more than 99% of his worth.
Sheryl Estrada
sheryl.estrada@fortune.com
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