The Most Underrated Part of Berkshire Hathaway Has Nothing to Do With Its Cash Pile
Key takeaways
- BRK-B NVDA Berkshire Hathaway (NYSE: BRKA)(NYSE: BRKB) is a shockingly diversified industrial conglomerate.
- From a big picture perspective, Berkshire Hathaway does a lot of things.
- In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia.
BRK-B NVDA Berkshire Hathaway (NYSE: BRKA)(NYSE: BRKB) is a shockingly diversified industrial conglomerate. However, it is classified as a finance company due to its large insurance operations. This is an important nuance to consider as you examine the nearly $400 billion in cash on the company s balance sheet. It is an important safety valve and provides firepower for investments when the time is right. But cash isn t what this business is built on; the float is.
From a big picture perspective, Berkshire Hathaway does a lot of things. However, former CEO Warren Buffett was really an allocator of capital, treating the company as his personal investment vehicle. Basically, buying Berkshire Hathaway was a way to trade alongside Warren Buffett. The fact that Berkshire Hathaway has a huge cash hoard today has nothing to do with Buffett s long-term success.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »