Warren Buffett’s Berkshire Hathaway reached a significant milestone on Wednesday, becoming the first U.S. company outside of the technology sector to achieve a $1 trillion market capitalization. The Omaha-based conglomerate’s shares have surged by more than 28% in 2024, far outpacing the S&P 500’s 18% gain. The landmark achievement comes just days before Buffett, known as the “Oracle of Omaha,” celebrates his 94th birthday. Shares of Berkshire Hathaway closed at $696,502.02 on Wednesday, marking a 0.8% increase and pushing the company’s market value past the $1 trillion threshold, according to FactSet.
“This milestone is a testament to the firm’s financial strength and franchise value,” said Cathy Seifert, a Berkshire analyst at CFRA Research. “It’s particularly significant at a time when Berkshire remains one of the few remaining conglomerates in existence today.” Berkshire Hathaway now joins an exclusive group of U.S. companies that have surpassed the trillion-dollar mark, including tech giants Apple, Nvidia, Microsoft, Alphabet, Amazon, and Meta. However, unlike these firms, Berkshire is known for its investments in traditional industries such as railroads, insurance, and fast food, although its significant stake in Apple has contributed to its recent stock price surge.
Buffett, who took control of Berkshire in the 1960s, transformed it from a struggling textile manufacturer into a sprawling empire with interests spanning insurance, railroads, retail, manufacturing, and energy. The company’s strong balance sheet and substantial cash reserves have been a hallmark of its success.
“It’s a tribute to Mr. Buffett and his management team,” said Andrew Kligerman, a Berkshire analyst at TD Cowen. “Berkshire’s ‘old economy’ businesses are what built the company, yet these businesses trade at much lower valuations compared to tech companies, which are not a major part of Berkshire’s portfolio.” Berkshire Hathaway’s rise to the trillion-dollar club is notable for its adherence to a conglomerate structure, a business model that has fallen out of favor in recent decades as many corporations have shifted towards specialization.