Berkshire Hathaway has already supplied one unusually concrete answer to the valuation debate around its Class B shares: it bought them itself at an average $487.98 in June. BRK.B closed Friday, September 11, at $510.37, according to historical market data. The 4.6% gap is not large enough to make the stock obviously expensive—but it shifts the burden of the thesis from “Berkshire is cheap enough to repurchase” toward “Berkshire can earn an attractive return on an enormous pool of capital.”
That distinction matters. A disclosed buyback price is the closest investors get to an observable verdict from Berkshire’s capital allocators, but it is neither a floor nor a fair-value target. The company’s authorization permits repurchases only when the chief executive, after consulting the chairman, believes the shares are below conservatively determined intrinsic value. It does not commit Berkshire to buy any amount.
The buyback is evidence, not a guarantee
Berkshire’s second-quarter Form 10-Q shows purchases of 7.14 million Class B shares at an average $487.98 in June, plus 413 Class A shares at $733,775.06. In May, it bought 1.46 million B shares at $476.01 and 65 A shares at $716,231.37.
The signal is useful because management acted with its own capital, not because the prices establish a hard boundary. June’s average says Berkshire saw value around the high $480s. Friday’s close says new buyers are paying modestly more than the company recently did. Intrinsic value could have risen since June, but the filing provides no formula that proves it.
There is another reason not to treat $487.98 as support. The authorization has no maximum size or expiration date, and Berkshire can simply stop buying. Its only explicit liquidity constraint is that repurchases must not reduce consolidated cash, cash equivalents and U.S. Treasury bills below $30 billion.
What a $510 BRK.B share represents
The quarter-end balance sheet makes Berkshire look liquid almost beyond comparison. Insurance and other businesses held $35.10 billion of cash and equivalents and $324.91 billion of short-term Treasury bills. Railroad, utilities and energy businesses held another $5.51 billion of cash. Together, that is about $365.51 billion.
Using the June 30 share count in the company’s quarterly report—501,101 Class A shares and 1.396 billion Class B shares outstanding—and the 1,500-to-one economic conversion ratio, TS2’s calculations put Berkshire at roughly 2.148 billion B-equivalent shares. At $510.37, that implies an equity value near $1.10 trillion.
On the same basis, quarter-end Berkshire shareholders’ equity of $747.91 billion works out to about $348.26 per B-equivalent share. The stock therefore trades at approximately 1.47 times book value. Cash and Treasury bills equal roughly $170.20 per B-equivalent share, while the $323.78 billion equity portfolio adds about $150.77 per share.
Those last two figures must not simply be subtracted from the stock price. Berkshire’s liquid assets support insurance obligations, taxes, acquisitions and operating-company needs; its railroad and energy units also carry substantial debt. The pile is capacity, not spare change distributable tomorrow.
The operating return is respectable, but the hurdle is high
Adding the five after-tax business lines Berkshire reports before investment gains and the volatile “other” line—insurance underwriting, insurance investment income, BNSF, Berkshire Hathaway Energy, and manufacturing, service and retailing—produces $21.80 billion for the first six months of 2026. Doubling that figure gives a deliberately simple annualized run rate of $43.59 billion, equal to about 4.0% of the current implied market value.
That is a lens, not a forecast. Insurance results can swing with catastrophe losses; the filing says first-half insurance investment income fell 8.3% as lower interest rates reduced interest income. At the same time, BNSF’s first-half earnings rose 9.5%, Berkshire Hathaway Energy’s increased 11.5%, and manufacturing, service and retailing earnings climbed 15.1%. The operating mix is improving even as the yield on liquidity faces pressure.
A tempting shortcut is to subtract all $365.51 billion of cash and Treasury bills from market value, then value the operating earnings against the remainder. That produces a multiple near 16.8 times the annualized core run rate. It is also too generous because it assigns no required capital to insurance or the other businesses and ignores the claims and liabilities sitting across the balance sheet. The truth belongs somewhere between that stripped-down multiple and the roughly 25 times implied by valuing the entire company against the same earnings run rate.
The real bet is deployment
Berkshire completed its Taylor Morrison acquisition on July 24 for approximately $6.8 billion of equity value and $8.5 billion of enterprise value. It is a sizable transaction in homebuilding, yet the enterprise value is only about 2.3% of Berkshire’s June cash-and-Treasury total. That is the conglomerate’s large-number problem in one comparison: even a multibillion-dollar acquisition barely moves the liquidity ratio.
The bullish case is that patient deployment, improving controlled-business earnings and occasional repurchases can compound value without requiring a heroic single deal. The strongest counterargument is that lower short-term rates reduce the income earned while cash waits, while few acquisitions are large enough to matter and attractive enough to clear Berkshire’s discipline.
For the next filing, the most informative signals are not GAAP investment gains. They are whether Berkshire keeps repurchasing shares near or above $510, whether liquidity falls for productive reasons rather than market losses, and whether the five core earnings lines keep growing after normalization for insurance volatility. Continued cash accumulation alongside declining interest income and no buybacks would weaken the case that today’s premium is being converted into per-share value.