While most of the U.S. stock market has struggled so far in 2025, Berkshire Hathaway (BRK.A -0.33%) (BRK.B -0.11%) has been heading in the opposite, more positive, direction. Of the seven American companies with at least a trillion-dollar market cap, Berkshire Hathaway is the only one up in 2025.
Led by Warren Buffett, Berkshire Hathaway’s success against the struggles of the broader stock market seems right on course. Buffett has been at the helm of Berkshire Hathaway since 1965, steering it through some of the best and worst times the U.S. stock market has encountered, and this seems no different.
With Berkshire Hathaway up 12% year to date (as of April 22), investors could be wondering if the stock is a buy or if they missed the train. Luckily, there are still a lot of positives ahead for the company.
Berkshire Hathaway’s insurance business is in good hands
A lot of attention is paid to Berkshire Hathaway’s stock portfolio and investment moves, but its insurance business, which includes GEICO, Berkshire Hathaway Reinsurance Group, and Berkshire Hathaway Primary Group, continues to thrive.
In 2024, Berkshire Hathaway’s insurance business earned $88.7 billion in premiums, up from $85.4 billion in 2023. Similar to dividends, insurance premiums give Berkshire Hathaway a steady and reliable income source. This is right on par with the company’s preference for owning cash-generating businesses.
Owning insurance businesses also gives Berkshire Hathaway a unique advantage because of its float. In insurance, float is money received from premiums that haven’t been paid out in claims, and Berkshire Hathaway’s sits at a massive $171 billion. This is low-cost capital that can be invested and used to make more money.
Berkshire Hathaway makes billions in its sleep
More than half of the companies in Berkshire Hathaway’s stock portfolio pay dividends, providing guaranteed income. It’s not a small amount of dividend income Berkshire Hathaway receives, either; it’s billions per quarter.
For perspective, Berkshire Hathaway will likely receive around $6 billion in dividends in 2025. For perspective, that would exceed IBM’s profits from 2024. And it comes with much less work, that’s for sure.
From just its stake in Coca-Cola and Bank of America, Berkshire Hathaway will receive over $450 million the next time these companies pay dividends. This is easy money that’s all but guaranteed and makes Berkshire Hathaway one of the largest cash cows on the market.
BRK.B Revenue (Annual) data by YCharts
No dividends, no problem
Despite how long it has been around and its enormous cash pile (over $334 billion at the end of 2024), one downside for Berkshire Hathaway is that it doesn’t pay dividends like companies of similar size and maturity. Instead, it rewards shareholders with stock buybacks.
The more shares Berkshire Hathaway buys back, the more investors’ ownership stake in the company increases. It’s a way to increase earnings per share (EPS) without needing to grow profits, although it has done a great job of doing so.
In 2024, Berkshire Hathaway spent $2.9 billion repurchasing its shares, which was below its average for the past five years but still a decent amount.
BRK.B Stock Buyback (Annual) data by YCharts
Buffett and his managers like to buy back shares when they feel as though the stock is trading below its intrinsic value. That may be why last year’s buyback total was less than we’ve seen in recent years. However, investors shouldn’t take that as a negative sign going forward.
Berkshire Hathaway is uniquely positioned to return long-term value. It has a thorough balance sheet, generates a ton of cash, and owns a diverse mix of top-tier businesses. You can’t ask for more from a conglomerate.
Bank of America is an advertising partner of Motley Fool Money. Stefon Walters has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bank of America, Berkshire Hathaway, and International Business Machines. The Motley Fool has a disclosure policy.
