Berkshire Hathaway’s Class A shares surged to a record high on Monday after the Warren Buffett-led conglomerate reported its highest-ever quarterly profit, driven by strong performance in its insurance operations.
Shares rose as much as 4.5% to $7,52,293.60 in early afternoon trading.
The increase boosted Berkshire’s market valuation to approximately $1.08 trillion. It is now valued higher than Elon Musk’s Tesla and semiconductor major TSMC.
Following the earnings release, multiple analysts raised their price targets and earnings forecasts for the company.
Buffett’s personal net worth also climbed past $155 billion, according to Forbes.
Berkshire Hathaway’s earnings beat expectations
Berkshire reported a 71% increase in fourth-quarter profit from its operating businesses, reaching $14.53 billion, or $13.38 billion when excluding currency gains—exceeding analyst expectations.
For the full year, operating profit rose 27% to $47.44 billion, marking another record. Higher returns from Berkshire’s $334.2 billion in cash and equivalents, largely invested in US Treasury bills, contributed to the results.
Cash reserves doubled in 2024 as Berkshire reduced its stake in Apple, though the tech giant remained its largest common stock holding.
In his annual shareholder letter, Buffett credited Geico CEO Todd Combs for improving underwriting profitability while cutting costs at the auto insurer.
Geico’s underwriting profit more than doubled in 2024, despite job reductions of over 2,300 employees last year, following 7,700 job cuts in 2023.
Berkshire Hathaway’s giant pile of cash grows
Berkshire Hathaway’s investment gains from its portfolio holdings slowed sharply in the fourth quarter, falling to $5.2 billion from $29.1 billion in the same period a year earlier.
The company sold more equities than it bought for the ninth consecutive quarter, with total equity sales exceeding $134 billion in 2024.
Buffett has been aggressively reducing Berkshire’s stakes in Apple and Bank of America, its two largest equity holdings.
As a result of this selling spree, Berkshire’s cash reserves hit a record $334.2 billion, up from $325.2 billion at the end of the third quarter.
In his annual letter, Buffett addressed concerns about the record cash pile, emphasizing that it does not signal a reduced appetite for stocks and businesses.
“Despite what some commentators currently view as an extraordinary cash position at Berkshire, the great majority of your money remains in equities,” that preference won’t change.”
Buffett hinted that high valuations were keeping him from making new investments, saying “often, nothing looks compelling.”
He also endorsed Greg Abel, his chosen successor, comparing his ability to identify investment opportunities to that of the late Charlie Munger.
Wall Street analysts on Berkshire Hathaway
Shields of KBW and Meredith of UBS have raised their price targets on Berkshire Hathaway’s Class A stock following the company’s Q4 2024 earnings report.
Brian Meredith reiterated his Buy rating on the stock and increased his price target to $836,135 from $803,444.
Meyer Shields boosted his target to $775,000 from $750,000, while maintaining a Market Perform rating.
The Keefe, Bruyette & Woods (KBW) analyst expressed optimism about Berkshire Hathaway’s stock performance following its EPS beat and GEICO’s strong core underwriting results.
In response to the recent earnings report, KBW has raised its 2025 EPS estimate for Berkshire Hathaway to $31,600 from $30,140.
However, the firm has slightly lowered its 2026 EPS projection to $32,660 from $32,720, factoring in higher expected insurance income but lower non-insurance income in the coming years.
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