Headed by renowned investor Warren Buffett, Berkshire Hathaway (BRK.A, BRK.B) is a holding company involved in multiple industries. As such, it faces a variety of competitors. From another perspective, its highly-regarded stock shares make it a competitor against investment companies that offer mutual funds and similar products.
A single share of Berkshire Hathaway’s Class A stock was worth $686,182 as of the end of the third quarter of 2024. That’s more than double its price five years ago.
Here are some of the sectors Berkshire is involved in and a selection of its leading rivals.
Key Takeaways:
- Due to Berkshire Hathaway’s diverse holdings, competitors are found in a variety of fields.
- In the diversified holding sector, Berkshire competes against firms such as Jefferies Financial Group.
- Berkshire Hathaway is a rival of large insurance firms such as Allstate Corporation.
- Berkshire can also be characterized as an investment management company and therefore competes with players like BlackRock.
- It’s also seen by some as a private equity firm, contending with the likes of KKR & Co.
Berkshire Hathaway Competition: An Overview
Warren Buffett is Berkshire Hathaway’s chair and CEO. The publicly-traded company’s many other investors include billionaires Bill Gates, founder and former CEO of Microsoft Corp., and Mexican business magnate Carlos Slim.
Berkshire Hathaway is heavily invested in insurance companies but other holdings range across the food, apparel, and utilities sectors. Other assets include jewelers and furniture retailers.
In the diversified holding sector, Berkshire competes against firms such as Jefferies Financial Group (JEF). As many of its assets are insurance subsidiaries, Berkshire Hathaway is a rival of large insurance firms such as Allstate Corporation (ALL).
As a diversified holding company, Berkshire stock acts as a quasi-mutual fund or private equity firm, putting it in competition with BlackRock, Inc. (BLK), and KKR & Co., Inc. (KKR).
Note
Greg Abel, a high-level executive of Berkshire Hathaway, has been announced as the eventual successor of Warren Buffet as CEO. Charlie Munger, Buffett’s long-time right hand, died in 2023.
Investment Banking
Jefferies Financial Group (formerly Leucadia National Corp.) is a competitor of Berkshire Hathaway where investments are concerned. With a similar business model, Jefferies is often called the Baby Berkshire.
While its stock is much lower priced and it has nowhere near the holdings that Berkshire Hathaway possesses, Jefferies has proved successful at acquiring promising assets at less than fair value and building their long-term growth.
Jefferies has holdings in a variety of industries, including the real estate, retail, energy, and telecommunications sectors. The company is also a 50% owner with Berkshire Hathaway in a real estate lending joint venture called Berkadia.
Insurance
Berkshire Hathaway is heavily invested in the insurance business. Through its Geico subsidiary, the company competes with insurance giants such as Allstate for auto and property coverage.
Allstate’s insurance assets include Square Trade, an extended warranty provider, and National General, a specialist in insuring commercial drivers such as truck and taxi drivers.
Berkshire also owns Gen Re, a reinsurance company for property, health, and life insurance policies.
Investment Management
Although Berkshire Hathaway is not officially a management investment company, it effectively plays in this space by managing a portfolio of securities for its investors.
BlackRock is a Berkshire competitor in this sector. It’s the world’s largest public investment firm with around $10.5 trillion in assets as of April 2024. Unlike Berkshire Hathaway, BlackRock does not participate in proprietary trading.
Also, BlackRock’s customer base is limited to institutional and retail investors, such as pension plans, mutual funds, insurance companies, and charities. Like other management investment firms, BlackRock provides formal mechanisms that allow investors to pool their capital with that of other investors to purchase professionally managed groups of diversified securities.
Private Equity
Some might not view Berkshire Hathaway as a private equity firm. However, KKR & Co. founder Henry Kravis has reportedly described Berkshire as the perfect private equity model due to its massive access to cash and publicly traded shares for acquisitions.
Much like KKR and other private equity companies, Berkshire Hathaway attracts investment capital from wealthy individuals and institutions who wish to acquire equity ownership in companies.
Private equity firms tend to be more direct about raising these funds and managing the money to ensure positive returns for shareholders.
What Companies Does Berkshire Hathaway Own?
Berkshire Hathaway owns more than 70 companies across many industries. Some of its holdings are:
- Consumer staples companies like Benjamin Moore, Duracell, Fruit of the Loom, Kraft Heinz, and See’s Candies.
- Luxury goods retailers like Helzberg Diamonds and Borsheims Fine Jewelry.
- Insurance companies including Berkshire Hathaway Specialty Insurance, Geico, MLMIC Insurance, and National Indemnity Co.
Berkshire Hathaway even owns Dairy Queen.
Why Is Allstate Considered a Berkshire Hathaway Competitor?
The Allstate Corporation is a major American insurance company that owns a variety of insurance company brands. Berkshire Hathaway’s biggest generator of profit is its insurance component, which includes GEICO. They both operate in the property/casualty insurance market. They vie for business from much of the same customer base.
What Is BlackRock?
BlackRock, Inc. is the world’s largest asset management, with about $10.5 trillion under management as of April 2024. Based on Berkshire Hathaway’s similar portfolio management role, Berkshire Hathaway and BlackRock can be considered competitors.
What Is Berkshire Hathaway’s Standing in the Insurance Sector?
Berkshire Hathaway is the second largest insurance company in the U.S. with total assets of over $873 billion. Only Prudential Financial is larger, with more than $940 billion in total assets.
The Bottom Line
Given that it owns a wide range of companies from Geico to Dairy Queen, Berkshire Hathaway can be said to compete in many industries. Not incidentally, the stock of this holding company is coveted by institutional and individual investors, putting it into competition with the big players in investing and in private equity.
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