Buffett’s Berkshire Hathaway Stock Survived Post-Tariff Market Drop: Here’s Why
Written by
John Csiszar
Edited by
Levi Leidy
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Warren Buffett, the popular billionaire CEO of Berkshire Hathaway, has one of the best investment track records in history. While Buffett’s folksy wisdom is always quotable, investors turn to his advice more than ever during market turndowns – and with good reason. As a value stock, Berkshire Hathaway tends to hold up better than more aggressive stocks during corrections and bear markets, and this has proven true yet again during the recent “tariff tantrum” the market endured in April.
From April 1 to April 8, for example, the S&P 500 fell 11.2%; however, shares of Berkshire Hathaway only dropped 7.4%. On a year-to-date basis through April 10, the disparity was even greater. While the S&P 500 was down 10.43%, shares of Berkshire were actually up 13.6%.
Here are some of the reasons why Berkshire Hathaway is holding up, and what investors can learn from them.
Berkshire Has a Lot of Cash
One of Berkshire Hathaway’s guiding principles is to only buy companies that trade at low price-to-book ratios. In other words, Buffett only likes to buy businesses on the cheap. As the markets have ferociously risen in recent years, with the S&P 500 index posting back-to-back years of 20%-plus returns, Buffett hasn’t found much to buy. As a result, Berkshire now has a monster treasure chest of over $334 billion in cash, its highest level ever.
While this huge cash position can act as a drag on the company when the market is screaming higher, when it sells off, as it has thus far in 2025, Berkshire is seen as a safe haven for investors. For one thing, Berkshire’s huge cash cushion helps protect the company’s overall returns. It also affords Buffett an excellent chance to buy companies that have sold off dramatically. Investors looking to bet on Buffett’s opportunistic buying are also helping push its share price higher.
Berkshire Invests In Blue-Chip Companies
The immense Berkshire Hathaway investment portfolio is worth roughly $258 billion, according to CNBC. However, nearly 50% of that entire portfolio is invested in just three stocks: Apple, comprising 22.1%; American Express, with a 14.5% weighting; and Coca-Cola, at 11%. Most of the other larger positions owned by Berkshire are also blue-chip names, from Chevron and Kraft Heinz to Bank of America and more. Beyond the investment portfolio, Berkshire owns a hugely diversified portfolio of private companies that are generally leaders in their field. All of these factors help to insulate the company’s stock from wide swings in value.
Buffett Has an Impeccable Reputation
One of Warren Buffett’s most famous quotes is that investors should “be fearful when others are greedy, and greedy when others are fearful.” It’s this counter-trend investment philosophy that helps make Buffett popular – and a great investor.
While the concept seems easy to follow, the reality is that most investors panic when others are fearful and get euphoric when others are greedy. Buffett’s steadfast approach has helped generate immense gains for Berkshire Hathaway over the years. The stock has dramatically outperformed the S&P 500 over the past one-, three-, five-, 10-, 15- and 20-year periods – and the disparity only increases over longer time periods. This incredible track record consistently draws investors into the stock, particularly in times of stock market upheaval.
The Bottom Line
Berkshire Hathaway is a conglomerate like none other. Run for decades by the famed “Oracle of Omaha,” Warren Buffett, Berkshire only invests in top-tier companies at low valuations. Its immense portfolio of privately held companies is diversified and well-managed, and it primarily represents Buffett’s hand-picked “best of the best.” Coupled with the stock’s impressive multi-decade record of outperformance, the company’s immense cash hoard and Buffett’s legendary ability to stare down bear markets and pick up bargains, perhaps it’s no wonder that the stock is beating the S&P 500 by roughly 25 percentage points in 2025 alone.
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