Berkshire Hathaway shares notch records as October gains outpace major indexes

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Berkshire Hathaway October records

Highlights

Berkshire Hathaway Class A shares close at a record $821,931 Monday, finishing October up 8.9%, outperforming the S&P 500's 0.9% drop and Nasdaq's 5.3% decline.
Berkshire's Alphabet stake falls from a third-quarter high of $40 billion to $29.6 billion after Alphabet shares plunge nearly 13%, erasing $500 billion in market value on negative free cash flow.
Berkshire sells $69 million of DaVita shares Tuesday, leaving 28.3 million shares worth $5.3 billion, as required to maintain its stake at 45% or lower amid DaVita buybacks.

October performance and record trading levels

As reported by CNBC, Berkshire Hathaway's Class A shares close Monday at a record $821,931 before ending the week up 0.3% at $815,600. The stock jumps to nearly $822,929 at Friday's open, but stays below the intraday record of $824,765 set the previous Thursday.

The more widely held Class B shares also post a record close on Monday at $548.56. During Friday's session, they reach $550.47, enough for a new all-time intraday high and slightly above the prior Thursday's $549.96, although the shares gain less than 0.1% for the week.

Even with the slower pace this week, Berkshire is closing October with an 8.9% gain. That compares with a 0.9% drop for the S&P 500 and a 5.3% decline for the Nasdaq, which falls 2.9% on Friday in its worst one-day slide since June as money moves away from AI and tech stocks over spending concerns.

Portfolio pressure from Alphabet and DaVita stake reduction

Berkshire appears to be benefiting from this back-to-basics rotation, trimming BRK.B's year-to-date gap versus the S&P 500 to 2.8 percentage points from 3.5 percentage points a week earlier. Over the past 12 calendar months, the stock is ahead of the benchmark by more than two percentage points.

One major holding in Berkshire's equity portfolio, however, is under pressure. Alphabet loses around $500 billion in market value on Thursday as the shares plunge nearly 13%, their worst day since the company went public in 2004, after third-quarter earnings show negative free cash flow of $9.1 billion, far worse than the $2.7 billion analysts expect, and web search revenue misses estimates for a second straight quarter.

Berkshire's Alphabet stake, started last year and increased by a $10 billion private placement in this year's second quarter, reaches a third-quarter high of $40 billion in early August. By Friday it falls to $29.6 billion, making it Berkshire's fourth-largest equity holding based on shares held as of June 30, while Coca-Cola moves firmly into third place with its value rising to $37.6 billion from a late-July low of $32.5 billion.

In a separate portfolio move, Berkshire says in an SEC disclosure this week that it sells $69 million of DaVita shares on Tuesday. The remaining 28.3 million shares are worth $5.3 billion, and the sale continues a series of quarterly reductions under a 2024 agreement requiring Berkshire to keep its DaVita stake at 45% or lower as the company reduces outstanding shares through buybacks.

Our earlier analysis of the S&P 500 highlighted how earnings-season headlines and shifts in Treasury yields were driving a rotation led by tech and AI names, even as the index remained under short- and medium-term selling pressure. We also noted that SPX was trading below its 20- and 50-day moving averages, with traders watching key support and resistance levels for the next directional move.

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