Key Updates
Berkshire Hathaway shares have recovered 2.10% to $747,889 since the last report, offsetting the September pullback. The main development was the complete sale of a 17-year stake in Chinese EV maker BYD, signaling continued trimming of exposure to Chinese assets. Even with the stock lagging the portfolio's gains, a more attractive valuation strengthens the investment case.
Current Trend
The stock is in a steady recovery, up 0.73% on the day, 1.62% over the week, and 1.84% over the month. Year-to-date returns stand at a solid 9.84%, although a 4.32% drawdown over the past six months reflects summer volatility. Shares trade near all-time highs, showing relative resilience amid broader market swings.
Investment Thesis
Berkshire Hathaway remains an attractive investment thanks to a diversified portfolio of high-quality assets, strong operating earnings from subsidiaries, and a hefty cash pile for capital allocation. Management continues to actively reshape the portfolio, exiting positions with limited upside and sticking with long-term quality names.
Thesis Status
The thesis is strengthening. The BYD sale shows disciplined risk management and a willingness to lock in profits after a big run in the Chinese automaker. The portfolio's gains while the stock lags leave the shares at a more attractive entry point for new investors.
Key Drivers
The big news is the full exit from BYD after 17 years, freeing up capital for new investments. A sharp jump in the equity portfolio in the third quarter with the stock lagging improves the relative appeal of Berkshire shares. The market is also reassessing fair value after the sustained run-up.
Technical Picture
The stock is in an uptrend, holding support around $720,000 and breaking through near-term resistance near $740,000. At $747,889, it sits just below all-time highs, with the next test at $750,000. Trading volumes remain moderate, typical for a high-priced Class A share.
Bull Case
- A rising portfolio value while the stock lags makes the valuation more compelling
- The BYD sale frees up substantial capital for higher-return investments
- Year-to-date gains of 9.84% show steady value creation
- Stable operating earnings from subsidiaries support reliable cash flows
- A long record of generating alpha through active portfolio management
Bear Case
- Exiting BYD after 17 years may signal fewer high-return opportunities ahead
- The 4.32% six-month drawdown shows vulnerability to market corrections
- The high share price limits liquidity and keeps retail investors out
- Heavy exposure to traditional sectors may mean missing the tech-led rally
- Finding large, high-quality assets at current valuations is getting harder