We recently published a list of Starter Stock Portfolio 12 Safe Stocks to Buy. In this article, we are going to take a look at where Berkshire Hathaway Inc. (NYSE:BRK-B) stands against other best beginner stocks.
The US stock market has experienced a turbulent first quarter of 2025, marked by increased volatility and negative returns across the major indices. Concerns surrounding tariffs, economic data, and the performance of key technology stocks contributed to this challenging period for investors.
The year began with the revelation of DeepSeek, an Artificial Intelligence (AI) software developed in China, which rivalled its US competitors, such as ChatGPT. The software was considered revolutionary compared to others, sending shockwaves across the global markets. Reuters reported a global investor sell-off across US indexes, with one of the major tech companies alone losing $593 million in one day.
The US government was quick to implement policies that are aimed to promote US-listed tech firms while simultaneously reducing the impact of the DeepSeek AI, such as the use of tariffs against trade with Chinese firms.
The uncertainty of the US economy added to the market volatility after the Federal Reserve announced it would maintain interest between 4.25% and 4.50% in the short term. The banking sector, which is considered a good investment during times of high interest rates, is not completely immune. Analysts who previously considered 2025 to be a low-interest rate year will now price in the impact of possible NPLs (non-performing loans) due to consistent fed rates.
In March, President Trump announced further global tariffs on Europe and China, fuelling the concerns of investors. In retaliation, Europe introduced counter tariffs. Emily Bowersock Hill, CEO and founding partner at Bowersock Capital Partners, which has $850M in assets under management, responded in an email to the methodology in calculating the tariffs by the US as:
“So simplistic, and frankly primitive as to leave the market wondering, did its architects ever take Econ 101?”
The US announced tariffs of 54% on Chinese goods, which will take effect on April 9, 2025. China, in response, implemented “reciprocal” tariffs on US goods of 34%, as reported by the country’s official Xinhua News Agency. This led to the US market indexes experiencing the biggest drop since COVID-19, with investors concerned about the impact of these tariffs on the supply chains of companies globally.
The US economy is considered to be entering “continuous stagflation”, which is defined as continued inflation with very low growth and high unemployment. The Cboe Volatility Index (aka VIX) is currently at 29.68%, well above its 1-year average of 17.6%. In such economic conditions, investors should seek stocks which should provide steady/ growing revenue, dividend growth, low cyclicality, and significant cash flows and have a durable competitive advantage. Systemically important sectors are thus ideal for investors, including energy, real estate, healthcare, finance, and tech.
Methodology
For this list, we analyzed the Tech, Finance, Real Estate, Energy, and Healthcare industries to identify the top stocks for each sector and their historical performance against the market. We then used Insider Monkey’s Q4 2024 proprietary hedge fund holdings database and identified the 12 most popular hedge fund stocks. The stocks are ranked in ascending order of their hedge fund positions.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A team of insurance professionals in a boardroom overlooking a city skyline.
Berkshire Hathaway Inc. (NYSE:BRK-B)
No. of Hedge Fund Holders: 131
Berkshire Hathaway Inc. (NYSE:BRK-B) is a diverse holding company operating globally through numerous subsidiaries. The company’s core businesses include insurance, freight rail transportation in North America, and utilities. Beyond these, Berkshire Hathaway has significant manufacturing operations producing confectionery, specialty chemicals, aerospace and power generation components, and building materials. Alternatively, it has a strong presence in consumer goods, including recreational vehicles, apparel, footwear, toys, jewelry, & batteries. Lastly, the company engages in distribution (electronics, groceries), franchising (quick service restaurants), logistics, aviation training, and retail (automobiles, furniture, appliances, and various consumer goods).
Berkshire Hathaway Inc. (NYSE:BRK-B)’s results for Q4 2024 showed revenue of $94.92 billion and an EPS of $6.73 billion. What’s unique about the company’s results is that it has cash reserves of $325 billion. The company has a unique strategy of carrying out buybacks, i.e., essentially repurchasing and retiring older shares of Berkshire, leaving each remaining share worth more.
Berkshire Hathaway Inc. (NYSE:BRK-B) has a vast and varied portfolio that reflects a long-term investment strategy across a multitude of industries. Its long-standing Chairman, Warren Buffet, is hailed as the “Oracle” of Wall Street. His annual newsletter to shareholders is read by millions of stock market enthusiasts across the globe. This highlights investors’ belief in following the investment strategies adopted by the company for sustained growth. In a letter to annual shareholders in February, Mr. Hathway stated:
“Despite what some commentators currently view as an extraordinary cash position at Berkshire, the great majority of your money remains in equities. That preference won’t change.”
The company is an investment powerhouse that continues to acquire companies that add value to its shareholders. More importantly, management knows when to identify opportunities to divest. This was carried out in 2024, long before any other investment firm. Berkshire Hathaway Inc. (NYSE:BRK-B) has a current upside of 1.71%, with a consensus of the twelve-month trading price of $502, which makes it one of the best beginner stocks to monitor.
Overall, BRK-B ranks 7th on our list of best beginner stocks. While we acknowledge the potential of BRK-B, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than BRK-B but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.