This week, Berkshire Hathaway, a subsidiary of Warren Buffett, achieved a historic milestone with its A-share price breaking through the $600000 mark for the first time.
The soaring stock price may soon lead this traditional industry conglomerate to join the trillion dollar elite club, an achievement that no American company outside the technology industry has achieved.
As of now, Berkshire's A report is $610000 per share, with a market value soaring to $880.965 billion, making it the seventh largest listed company in the United States.
This Omaha based giant has risen 1.84% in the past 5 trading days, 5.55% in February, 12.43% year to date, and 30.54% in the past 52 weeks.
There is still a gap of 120 billion US dollars from the trillion dollar market value
As of the end of 2023, Berkshire's market value was approximately $777 billion, compared to $682 billion at the end of 2022. The journey of Berkshire A-shares from $500000 to $600000 took approximately two years.
During this period, Buffett implemented significant strategic initiatives. This includes the acquisition of insurance company Alleghany for $11.6 billion, holding nearly 30% of Western Oil Company's shares, and Geico's successful turnaround from losses to profits. In addition, Buffett strategically invested billions of dollars in treasury bond to take advantage of rising interest rates and expand his already profitable shares in Japanese trading companies.
Berkshire launched lower priced B-class stocks in 1996. At that time, the trading price of Class A stocks was slightly higher than $30000, while the starting price of Class B stocks was 1/30 of Class A, about $1000. Nowadays, Berkshire's B-class stocks are trading at a slightly higher price than $400, partly due to Berkshire's stock split after acquiring railway operator BNSF in 2010.
Berkshire may be included in the Mag 7 list
As Berkshire's market value rises, people are beginning to discuss whether it may be included in the list of Magnifier 7 (Mag 7) stocks.
This is a group of stocks that led the market to soar in 2023, including Microsoft, Alphabet, Amazon, Apple, Meta Platforms, Nvidia, and Tesla.
Strategas Securities, a renowned research firm on Wall Street, has identified Berkshire as one of the three major stocks in the Mag 7 group that could replace Tesla, alongside Broadcom and Lilly. According to Strategas, Berkshire is currently the most suitable candidate to replace with Mag 7 based on market value weighting and profit contribution to the S&P 500 index.
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