Should you buy Berkshire Hathaway stock before January 30?

To say that Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) It has been a big winner for long-term investors would be an understatement. Between 1964 and 2023, Berkshire’s overall gain was a jaw-dropping 4,384,748%—more than 140 times that of S&P 500profit during this period. Berkshire has also outperformed the S&P 500 since the end of 2023.

There could be a reason to invest in the Warren Buffett-led conglomerate sooner rather than later. The question is: Should you buy Berkshire Hathaway stock before January 30?

You may wonder what’s special about this date. No, Berkshire Hathaway is not scheduled to report its latest quarterly results. The company’s next quarterly update will likely come in late February. Berkshire has not announced any other special event for this week.

However, another company will Reported its results for the first quarter of fiscal year 2025 on January 30 – apple (NASDAQ:AAPL). It could be one of Apple’s most important updates in a long time. Investors will be particularly interested in learning how smart Apple’s new package is Generative AI Features available with iOS 18, iPhone sales affected.

Why does Apple’s quarterly update to Berkshire Hathaway matter? Although Buffett has been reducing his company’s stake in the consumer technology giant in recent quarters, Apple remains the largest holding in Berkshire’s portfolio. Berkshire is the sixth-largest institutional shareholder, owning about 2% of Apple.

Berkshire’s position in Apple currently makes up about 6.7% of the conglomerate’s market cap. This is an important enough level that Apple Berkshire’s performance matters. But how much does it matter?

Over the past five years, the correlation coefficient between Apple and Berkshire stock offerings using monthly returns is 0.49. This is a moderate relationship. 1.0 is very strong.

Could Berkshire Hathaway price jump if Apple reports exceptionally impressive results later this week, though? maybe. However, if history is any guide, don’t rely on it.

For example, Apple blew away Wall Street expectations with its fiscal 2020 third-quarter results, on July 30, 2020. The company also announced a 4-for-1 Stock split Investors are excited. Apple stock immediately rose 10.5% the next day. Berkshire Hathaway’s stock price rose less than 1%, a Ho-Hum move despite Apple’s impressive quarterly update.

On January 27, 2022, Apple once again posted impressive results. Apple CEO Tim Cook’s comments about increased investment in augmented reality have captured investors’ attention. Apple shares jumped 7% the next day. What about Berkshire Hathaway? Its shares also rose, but by a less impressive 1.7%.

So, should you scramble to buy Berkshire Hathaway shares before Apple reports its results on January 30? Maybe not. The better question, in my opinion, is: Should you buy Berkshire stock no matter what happens with Apple?

There’s a reasonably strong argument that you shouldn’t buy Berkshire. Even Buffett doesn’t seem to think his stock is a great pick right now. After six straight years of stock buybacks, it has not repurchased any of its shares in the third quarter of 2024.

This seems to be a clear sign that he does not see the valuation of the company he runs as attractive. In fact, Berkshire trades on a P/E ratio of 23.6. This is more expensive than stocks have been in a while.

Analysts don’t expect exceptional growth for Berkshire Hathaway any time soon. The Wall Street consensus estimate is that the conglomerate’s revenue will increase less than 1% in 2025, with earnings per share rising about 2%.

Despite these concerns, though, I still think Berkshire Hathaway is a good stock for long-term investors. Its business generates reliable cash flow. Berkshire offers almost ETF-like diversification, through its subsidiaries and stock rights that span a wide range of industries. The company also has a huge cash hoard that it could put to good use when the stock is valued more attractively.

I don’t think there’s any reason to rush to invest in Berkshire. But there’s still a stock to keep on your radar.

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Keith Speight He has positions in Apple and Berkshire Hathaway. The Motley Fool has positions in and recommends Apple and Berkshire Hathaway. Motley Fool has a file Disclosure policy.

Should you buy Berkshire Hathaway stock before January 30? Originally published by The Motley Fool

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