Warren Buffett, the 94-year-old investment sage, continues to prove his prowess in the financial markets as Berkshire Hathaway outperformed the S&P 500 in 2024. Despite selling down his two largest holdings, Apple and Bank of America, Berkshire Hathaway's Class A shares surged by an impressive 25.5%, compared to a 23.3% return for the S&P 500. This marks the ninth consecutive positive year for the conglomerate, showcasing Buffett's unparalleled long-term track record.
As of September 2024, Berkshire Hathaway reported a substantial cash hoard of $325 billion. This financial cushion has allowed the company to earn $8 billion in interest and other investment income during the first three quarters of the year. The diversified nature of Berkshire's businesses, which includes entities like BNSF Railway and See's Candy, has contributed significantly to its success.
Berkshire Hathaway's performance has been bolstered by its insurance operations, particularly Geico. The insurance giant recorded an underwriting profit of $5.7 billion in the first three quarters of 2024, helping to offset weaknesses in other areas of the company’s insurance sector. However, Buffett made headlines when he halted Berkshire's stock buyback program, citing increased stock prices as the reason.
Buffett's investment philosophy remains consistent even as he adjusts his portfolio. He acknowledged the challenges in predicting market performance, stating, "Anything beyond 'slightly better,' though, is wishful thinking." This statement reflects his cautious approach as he navigates changing market conditions.
The strength of Berkshire Hathaway is evident not only in its stock performance but also in its historical context. Since Buffett took control in the 1960s, the conglomerate has doubled the average annual return of the S&P 500. During 2024, Berkshire shares even topped $700,000, a milestone that highlights the value investors place on Buffett's leadership and strategy.
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