Berkshire Hathaway: A Stable Giant Facing Cash Deployment Challenges

# Berkshire Hathaway's Record Cash Reserves and Q3 Strength: Market Analysis & 2024 Outlook

Discover the latest insights on Berkshire Hathaway's Class A shares trading around $736,150 with extremely limited liquidity (just 270 shares daily). Our newest podcast episode analyzes their impressive Q3 results, including a 33% jump in operating earnings to $13.5B and insurance underwriting profits that tripled year-over-year.

We explore the significance of Berkshire's unprecedented $380B cash reserve and what it reveals about Warren Buffett's investment strategy in today's challenging market. Despite recent analyst upgrades and a consensus "moderate buy" rating, we examine why BRK.A has underperformed the S&P 500 with high single-digit YTD returns compared to the broader market's double-digit gains.

The episode breaks down current investor sentiment, technical indicators, and future earnings projections to help you understand whether Berkshire's conservative positioning represents financial prudence or missed opportunities. Perfect for value investors, market analysts, and anyone following Buffett's investment philosophy in an uncertain economic landscape.

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Episode Transcript

Speaker 1 (00:00):
Bircher Hathaway Class A shares are currently priced around seven
hundred thirty six thousand, one hundred fifty United States dollars,
reflecting stability in the upper range of their recent jail.
The trading volume remains quite low, averaging only about two
hundred seventy shares per day, which highlights the stock's notorious
illiquidity and suggests that large trades can move the price

(00:21):
significantly more than in more liquid companies. Over the past day,
the price moved up slightly, though its trend direction is
seen as bearish, and technical indicators overall are neutral to
slightly bullish. Recent headlines from earlier this November focused on

(01:04):
a robust third quarter report, where Berkshire recorded a jump
of over thirty three percent in operating earnings to thirteen
and a half billion United States dollars, with insurance underwriting
results tripling year over year. The company also reported record
cash levels north of three hundred eighty billion United States dollars,

(01:24):
which underscores both its financial resilience and the current challenge
of finding attractive investments at scale. Unlike in some previous quarters,
there were no major share buybacks. These strong results of
prompted a handful of analyst upgrades in price target increases.

(01:48):
For instance, UBS raised its target for the company's Class
B shares, and currently the consensus analyst view is moderate
by trending a bit more bullish than in the recent past. However,
the stock has underperformed the broader equity indexes over the
past year. Year to date, returns for Berkshire shares are
in the high single digits, while the standard Impoors five

(02:10):
hundred index gained well into double digits over the same period.
For the remainder of the year, earnings per share are
forecast to flatten or even inch down slightly. The current
sentiment among investors remains mixed, with a moderate level of
fear reflected in sentiment indices, but forecasts for the next
year and beyond still anticipate gradual appreciation. In summary, Berkshire

(02:33):
Hathaway today is a stable giant, anchored by a vast
pile of cash and strong insurance operations, trading at a
high nominal price with very thin daily volume. Recent analyst

(02:53):
attention is positive but not euphoric, and the company faces
pressure to deploy its record cash hoard in a market
brimming with uncertainty and few obvious bargains