Warren Buffet’s Berkshire Hathaway Inc. added another feather to its cap Wednesday for being the first non-technology-based company in the U.S. to reach the coveted $1 trillion market capitalization.
In 2024, shares of the conglomerate have increased by more than 28%, higher than the 18% gain of the S&P 500. The notable mark was hit by Berkshire Hathaway just two days before Buffet turned 94 years old, CNBC reported.
According to FactSet, Berkshire Hathaway’s shares were up by more than 1% on Wednesday, hitting a high of $699,699. This jump in stock price, along with the company’s other assets, propelled it above the $1 trillion mark.
“This is significant at a time when Berkshire represents one of the few remaining conglomerates in existence today,” said Berkshire analyst at CFRA Research, Cathy Seifert.
Other companies that have reached the same milestone belong to the technology field. These trillion-dollar companies include Apple, Nvidia, Microsoft, Alphabet, Amazon and Meta. Other than its investment portfolio, Berkshire Hathaway is not in the tech scene but is focused on the economy.
Buffett took control of the company in the 1960s, and the “Oracle of Omaha” was able to transform a struggling textile business into a huge conglomerate with multiple businesses under its umbrella, including insurance, retail, railroad, energy an manufacturing.
“It’s a tribute to Mr. Buffet and his management team, as ‘old economy’ businesses … are what built Berkshire. Yet, these businesses trade at relatively much lower valuations, versus tech companies which are not a major part of Berkshire’s business mix,” said TD Cowen’s Berkshire analyst, Andrew Kligerman.
“Moreover, Berkshire has achieved this through a conglomerate structure, a model that many view as ‘archaic,’ as corporations have increasingly moved to specialization over the decades,” he added.
As of Tuesday, the fortune of Buffett was estimated to be about $144.9 billion, Reuters noted. The figure makes him the sixth-richest person in the world, according to Forbes.
Buffett has already anointed his successor, Greg Abel, the vice chairman of Berkshire’s non-insurance operations. He even declared during the recently held annual meeting of the company that when he is no longer at the helm of the business, Abel will be the one to have the final say on the investing decisions of the company.
