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Berkshire Lags S&P 500: Will History Repeat?
14 Sep
Summary
- Berkshire Hathaway stock has underperformed the S&P 500 in 2026.
- Historically, Berkshire often outperforms the year after lagging.
- CEO Greg Abel has initiated significant acquisitions and buybacks.
Berkshire Hathaway's stock performance in 2026 has lagged behind the S&P 500, with its B shares showing a modest gain of approximately 2% compared to the index's roughly 11%. This underperformance is statistically uncommon for the conglomerate.
Historically, periods where Berkshire trails the S&P 500 by 10 or more percentage points have frequently been followed by periods of outperformance. Since 1990, this has occurred nine times, with Berkshire outperforming the index the following year in seven instances. The full history since 1965 shows 13 such lagging years, with 10 followed by outperformance.
Under new CEO Greg Abel, who took over on January 1, 2026, Berkshire has begun deploying its significant cash reserves. As of June 2026, the company held approximately $365 billion in cash and Treasury bills. Notable spending includes the acquisition of OxyChem for $9.4 billion in January and Taylor Morrison for $6.8 billion in late July, alongside $4.5 billion in share repurchases during the second quarter.
