Key Points
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Berkshire Hathaway isn’t just a collection of hand-picked quality stocks.
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The company also owns several reliable cash-cow businesses.
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This combination allows for consistent forward progress.
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Any prediction about a stock’s future price should be taken with a grain of salt. This one is no exception. Still, while past performance is no guarantee of future results, history is a reasonable indication of what the future likely holds, particularly when the underpinnings of that performance remain in place.
With that as the backdrop, Berkshire Hathaway (NYSE: BRKA) (NYSE: BRKB) could arguably reach a price of $700 before the end of 2030, when Greg Abel wraps up his fifth full year as the company’s CEO.
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More than a stock portfolio
You likely know it as a collection of hand-picked blue chips, and it is that to be sure. Berkshire’s currently holding Coca-Cola, Alphabet, and oil giant Chevron, just to name a few. Not all of them beat the market, but plenty of them do.
Berkshire Hathaway is more than a portfolio of Warren Buffett-approved stocks, however. The conglomerate also owns a few dozen businesses outright, including GEICO insurance, Fruit of the Loom, Duracell batteries, and Pilot Travel Centers. Unlike its stock holdings, which add value by logging capital gains, these privately owned brands generate cash income that goes straight to Berkshire’s bottom line.
The company delivered operating earnings of $44.5 billion last year, down slightly from 2024’s figure, but well above the five-year average of $37.5 billion. Through the first half of this year, operating earnings of $24.3 billion are tracking nearly 17% above last year’s first-half comparison of $20.8 billion.
That’s no trivial detail either. Although business income is only a part of Berkshire’s overall value, it’s an important part with solid, reliable growth. Assuming similar growth going forward, the conglomerate could report operating earnings of at least $60 billion in 2030.
Then there’s the part of Berkshire you likely know quite well. That’s its stocks.
While frustration grew with how much cash Warren Buffett was increasingly keeping on the sidelines rather than putting to work in the market, the conglomerate’s cash hoard appears to have peaked at $397 billion in Q1 of this year. New CEO Greg Abel is putting it to work, adding to an existing stake in Alphabet, for instance, as well as Delta Air Lines.
As of the latest look, the company’s equity portfolio is worth $362 billion, compared with Berkshire’s total market cap of $1.16 trillion. Even if Abel doesn’t add any new positions between now and 2030 and its current holdings only earn a subpar average annual gain of, say, 7%, these holdings will still collectively be worth somewhere around $475 billion.
In the meantime, most of Berkshire Hathaway’s $366 billion in cash is invested in short-term government bonds that are also earning a modest yield.
Value drivers
Again, this is a projection rather than a promise. Assuming Abel does nothing else between now and then, however, by 2030 Berkshire could be holding $475 billion in stocks, producing $60 billion in annual operating earnings, and sitting on nearly $400 billion in cash. That could easily make the company worth $1.5 trillion, which would conservatively make the company’s B shares worth at least $700 apiece. That’s roughly 30% above their present price.
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James Brumley has positions in Alphabet and Coca-Cola. The Motley Fool has positions in and recommends Alphabet, Berkshire Hathaway, and Chevron. The Motley Fool recommends Delta Air Lines. The Motley Fool has a disclosure policy.
