Although there's no telling where BRK. B shares could be 20, 30 or 40 years from now, it's possible to get a rough idea of the 10-year horizon. By some forecasts, shares of Berkshire could trade as high as $900 by 2034.
Stock Market Average Yearly Return for the Last 10 Years
The historical average yearly return of the S&P 500 is 13.316% over the last 10 years, as of the end of December 2024. This assumes dividends are reinvested. Adjusted for inflation, the 10-year average stock market return (including dividends) is 10.021%.
$3,000 X 12 months = $36,000 per year. $36,000 / 6% dividend yield = $600,000. On the other hand, if you're more risk-averse and prefer a portfolio yielding 2%, you'd need to invest $1.8 million to reach the $3,000 per month target: $3,000 X 12 months = $36,000 per year.
Warren Buffett's Berkshire Hathaway outperforms S&P 500 in 2024.
After seven straight days of gains that propelled Berkshire Hathaway's Class A shares 6.8% higher, the stock closed today at a fresh all-time high of $582,300 per share. Over the past five years, they have increased by almost 92% vs. the S&P's 83.5% gain, excluding dividends.
The 20 year total return for BRK. B stock is 669.44%.
Berkshire Hathaway (BRK. A -2.20%) (BRK. B -2.03%) is often considered a reliable stock for conservative long-term investors. The conglomerate is led by Warren Buffett, who famously said his favorite holding period for a stock is "forever."
NYSE: BRK.
Berkshire Hathaway differs from other investment firms, like hedge funds. Anyone can invest in Berkshire Hathaway if they have enough money to buy at least one Class B share (more than $450 in late 2024).
The average price target for Berkshire Hathaway B is $490.50. This is based on 2 Wall Streets Analysts 12-month price targets, issued in the past 3 months. The highest analyst price target is $531.00 ,the lowest forecast is $450.00. The average price target represents 8.56% Increase from the current price of $451.84.
A good return on investment is generally considered to be around 7% per year, based on the average historic return of the S&P 500 index, adjusted for inflation. The average return of the U.S. stock market is around 10% per year, adjusted for inflation, dating back to the late 1920s.
The 5-year total return is 99.94%, meaning $100 invested in BRK. B stock 5 years ago would be worth $199.94 today. Total return includes price appreciation plus reinvesting any dividends paid out.
Berkshire's massive cash position offers flexibility, and Berkshire's management team has navigated many recessions and bear markets and has a knack for getting out at the right time. Given these factors, I believe Berkshire will outperform the broader market in 2025.
The closing price for Berkshire Hathaway (BRK. A) in 1980 was $425, on December 30, 1980. It was up 46.6% for the year. The latest price is $663,000.
The current dividend yield for Berkshire Hathaway as of December 31, 2024 is 0.00%.
Class A shares offer a long-term investment but little chance of a stock split down the line. Investors looking for flexibility might prefer to invest in Berkshire's Class B shares.
Top Warren Buffett Stocks
Coca-Cola (KO), 400 million. Kraft Heinz (KHC), 325.6 million. Apple (AAPL), 300 million. Occidental Petroleum (OXY), 264.3 million.
SPY is more expensive with a Total Expense Ratio (TER) of 0.0945%, versus 0.03% for VOO. SPY is up 28.31% year-to-date (YTD) with +$7.13B in YTD flows. VOO performs better with 28.36% YTD performance, and +$103.99B in YTD flows.
S&P 500 Investment Time Machine
Imagine you put $1,000 into either fund 10 years ago. You'd be up to roughly 126.4% — or $3,282 — from VOO and 126.9% — or $3,302 — from SPY. That's not exactly wealthy, but it shows how you can more than triple your money by holding an asset with relatively low long-term risk.