Apple (AAPL 1.71%) started the trillion-dollar market cap club several years ago, but since that time, there have been several other companies to join. As of this writing, 10 U.S. companies have achieved a trillion-dollar valuation.
All of the companies that have reached the trillion-dollar level are technology businesses -- except one. Earlier in 2025, Berkshire Hathaway (BRK.A 1.59%) (BRK.B 1.50%), the conglomerate led by Warren Buffett, became the first non-technology company to reach the elusive thirteen-digit valuation level.
Berkshire reached an all-time high in late April, and then CEO and legendary investor Warren Buffett announced his intention to step aside at the end of the year. Since that time, Berkshire has dropped by 14%, giving up most of its gains for the year. Now, the massive conglomerate is valued at just over $1 trillion -- still a member of the trillion-dollar club, and it might be cheaper than you think.
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Berkshire Hathaway's recent performance
There are three main components to Berkshire Hathaway, at least from an investor's perspective. Berkshire owns a collection of more than 60 operating businesses, including some household names like GEICO, Duracell, Fruit of the Loom, and Dairy Queen. It also owns a stock portfolio worth nearly $300 billion that includes several notable large positions in companies such as Apple and American Express (AXP 1.33%). And last but certainly not least, Berkshire has about $344 billion in cash and short-term investments on its balance sheet.
In Berkshire's recent quarterly report, operating earnings declined by about 4% year-over-year, but this was due to unfavorable foreign exchange fluctuations (some of Berkshire's debt isn't in U.S. dollars). The only other negative was a year-over-year decline in underwriting income from the insurance business, which can be lumpy.
Beyond that, everything looks strong. BNSF railroad's operating earnings grew 19% year-over-year. Berkshire Hathaway Energy, whose prices are heavily regulated, grew earnings by 7%, as did all of the company's manufacturing, service, and retail businesses. Plus, Berkshire's cash stockpile sits at $344 billion, and the company's massive stock portfolio gained significant value during the second quarter.
A cheaply valued collection of businesses
The cash and the stock portfolio are easy to value. There's $344 billion in cash on the balance sheet, and Berkshire's stock portfolio is worth about $292 billion as I'm writing this. Backing those out of Berkshire's market cap shows a valuation of about $364 billion for all 60+ operating businesses combined.
With about $31.4 billion in operating earnings, excluding investment income, for the past four quarters, this implies that Berkshire's businesses are being valued at just 11.6 times trailing 12-month earnings. That's cheap.
Is the 'Buffett Premium' gone for good?
Clearly, at least some of the recent decline is due to Warren Buffett's pending departure. After all, Berkshire is down by 14% during a time period where tariff uncertainty declined and the S&P 500 rallied by 15%. And there's a fair case to be made that Berkshire should be higher than it was three months ago. After all, all of Berkshire's 10 largest stock positions have outperformed the conglomerate's stock in the months since Buffett's announcement.
However, there's also an argument that not much is going to change once Buffett is no longer at the helm. He has limited involvement in the day-to-day operations as it is. Ajit Jain runs the insurance business with little oversight, and future CEO Greg Abel is already in charge of all non-insurance operations. Portfolio managers Ted Weschler and Todd Combs have shown excellent capital allocation ability, and the $344 billion cash hoard gives Abel tremendous firepower. Berkshire is one of my largest investments already, but if I had to buy one of the 10 trillion-dollar stocks today, it's the one I'd choose.
