If there’s one investor you should follow, it’s Warren Buffett. Investing in his holding company, Berkshire Hathaway, makes sense for both beginners and seasoned investors. So, knowing all that, you may be wondering how to buy Berkshire Hathaway stock.
We’ll cover the basic information about the company and its history, and examine how Berkshire Hathaway stocks are performing on the stock market. You’ll also learn whether adding them to your portfolio is a good idea or not, and we’ll explain how to buy BRK stock if you decide it’s the best course of action.
Berkshire Hathaway — About the Company
Berkshire Hathaway Inc. was formed by the merger of two cotton mills in 1955. But it was Warren Buffett who turned it into a successful conglomerate when he purchased the then-struggling company in 1965. Under his leadership, the company expanded with the inclusion of companies in the insurance, financial, entertainment, clothing, transportation, and furniture industries.
Today, Warren Buffett’s Berkshire Hathaway includes some of the most famous American brands such as Duracell, Dairy Queen, and Geico. What’s more, the company holds high stakes in blue chip stocks companies such as Coca-Cola and Apple. Since Buffet took over the company its Class A stock increased from $19 in 1965 to $290 in 1980, and it hasn’t stopped increasing. The Class B stock debuted in 1996 at the price of $22.20.
Investment managers for Berkshire Hathaway Holdings continue to put money into technology-based companies like Verizon and Snowflake. It’s a strategy that’s been proven to be successful by the incredible gains Berkshire Hathaway made in the previous years.
Should You Buy Berkshire Hathaway Stock?
While many investors were disappointed in Berkshire Hathaway’s performance in 2020, current reports are encouraging. Back on track, upswings are being noted in the Berkshire Hathaway ticker for both the A and B classes of stocks. Warren Buffett spoke cautiously about the stock market at the Berkshire investors’ meeting in May 2021. He also mentioned the name of his successor should he retire.
Despite the current leader’s caution and possible leadership changes on the horizon, Berkshire Hathaway stock performance in the third quarter of 2021 remains solid. Its 52-week period performance for Class B stock ranges between $177.77 and $295.
Berkshire Hathaway Stock Performance
As with many other companies, Berkshire Hathaway stock holdings have been affected by the fallout caused by the COVID-19 pandemic. In 2020, the holdings company took a $9.8 billion writedown, and operating profit dropped by 10%. However, by Q2 of the same year, its net income surged by 87% due to gains in Berkshire Hathaway investments as markets started to recover.
BRK B stock has also shown recovery since the start of the pandemic, with an 18% increase in 2021. Class B is selling at around $279 per share as of July 2021 up from $182 in the previous year around the same time. This uptick in stock value is encouraging for investors.
In the same period, BRK A sat at $420,000 per share compared to $265,000 in July 2020. This steady increase is more evidence of the holding company’s solid footing in the current stock market. With both BRK B and Berkshire’s Class A stocks performing strongly, it’s safe to say the company has rebounded well since the pandemic started.
Many of the Berkshire Hathaway subsidiaries are focused on insurance. Texas “Uri,” the catastrophic winter storm of February 2021, caused a substantial $460 million insurance loss for the company. However, Berkshire Hathaway stock performance resurged quickly, bouncing back from the state’s huge insurance claims.
In 2020, Berkshire cut Pfizer (PFE) along with Barrick Gold (GOLD). However, this had a limited impact on their cash value which reached $145.4 billion by March 2021. The latest Berkshire Hathaway earnings report mentions an operating income of $7.018 billion in Q1, while $6.6 billion worth of Berkshire shares were repurchased.
Since the beginning of 2021, Berkshire Hathaway’s stock performance has consistently doubled on the S&P 500 index after dropping sharply at the start of the pandemic in early 2020. When it comes to Berkshire Hathaway portfolio and its stock performance, consider the return on assets of 12.32% as of 31st March 2021. This shows a steady upward trend compared to its previous quarter.
Deciding where to invest in the stock market is something both beginners and experienced investors are always exploring. You can take advantage of stock screeners to keep you up-to-date with current trends. But, if you are looking at specifically adding Berkshire Hathaway stock, whether B or A Class, to your portfolio, you need to decide if they complement it.
The current BRK.B stock price is strong and always significantly lower than the more expensive Class A stock share price. Adding this ninth-largest public company to your portfolio could be a good idea. Beginners to the stock market could especially benefit from investing in Berkshire Hathaway B stock.
Something you do need to consider, though, is that Berkshire Hathaway doesn’t pay BRK B or BRK A dividends. If this matters to you, then purchasing BRK stocks may not be your best pick.
Berkshire Hathaway stock price, as with any other stock, can change quickly, so factor this in when making a final decision on including this company in your portfolio.
How to Buy Berkshire Hathaway Stock
If you are considering adding Berkshire stock to your portfolio, you may be wondering how to go about doing it.
Berkshire Hathaway doesn’t have a direct stock purchase plan. That means you’ll have to go through a licensed broker to access Berkshire stock. A financial advisor will also be able to advise you on how to go about the process.
Online Brokers / Trading Platforms
If you’re considering adding Berkshire Hathaway stock to your profile, you’ll need to open a brokerage account with an online broker or trading platform. When buying, use the Berkshire Hathaway symbol (or ticker), BRK.A or BRK.B.
If you’re still new to the world of stock trading, you could consider using a trading platform app to build your portfolio.
- When selecting an online broker or trading platform, consider the following:
- Will you be trading frequently or infrequently?
- What kind of service do you need?
- Are there commission fees? Some platforms do offer commission-free trading.
- Are you a beginner or a more experienced investor?
Using an online broker or trading platform helps you not only purchase Berkshire Hathaway stock but they help you manage your shares and portfolio efficiently.
A financial advisor will help you decide whether buying Berkshire Hathaway shares is a good investment or not. This is often a more costly option than an online broker or using a trading platform. However, the expense is worthwhile if you’re still learning the ropes or if you want a professional to handle your portfolio completely.
A professional financial advisor will be able to best advise you on purchasing Berkshire Hathaway B or BRK.A stock based on your own investment history and risk tolerance. Working closely together with an expert in the field allows you to invest wisely. And, they’ll be well-placed when it comes to talking about Berkshire Hathaway companies’ stock shares.
Adding Berkshire Hathaway to your portfolio is a reliable way to diversify it with stock from a reliable company. You have the choice of purchasing BRK A vs. BRK B stock, and the Berkshire Hathaway annual report makes it easier to decide whether you should invest in the company. When you know how to buy Berkshire Hathaway stock, you’ll discover it’s easier than you expected.
With Berkshire Hathaway stock price holding strong since Warren Buffett’s takeover, investing in this holding company is worth giving a go if you can afford to hold stock.
A famous American business magnate and investor, Warren Edward Buffett, owns Berkshire Hathaway Holdings. Despite being 91 years old, he’s still the chair and CEO of the company.
Berkshire Hathaway Inc. fully owns Geico, Fruit of the Loom, Duracell, BNSF, Dairy Queen, Helzberg Diamonds, FlightSafety International, Forest River, Pampered Chef, NetJets, Long & Foster, and Lubrizol.
Berkshire Hathaway stock A price is one of the most expensive public trading stocks. Warren Buffett has a very good reason for not letting Class A shares ever experience a stock split. By keeping the share prices high, he believes they’ll attract similar investors who are serious about their long-term profits.
Berkshire Hathaway stock dividend has never been paid out. This is because Warren Buffett operates on the principle of reallocating profits for reinvestments into the company.
Warren Buffett runs Berkshire Hathaway as a corporation and not as a mutual fund. This frees the company up to buy entire companies whenever it wants to.
The main difference between Berkshire A and B shares is the price. BRK.B is a whole lot cheaper than BRK.A, making it more accessible to the small investor.
Originally founded in 1839 and traded as Valley Falls Company, a merger in 1955 changed the company’s name and it started trading as Berkshire Hathaway. It was taken over by Warren Buffett in 1965.
In 1962, Warren Buffett paid $7.50 each for his first stock shares from Berkshire Hathaway.
You can learn how to buy Berkshire Hathaway stock by following the steps in this article and start making a return on your investments.