Berkshire vs. S&P 500: Valuation Gap Widens

By Athena Xu

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5/7, 03:20 EDT

The price-to-earnings (P/E) ratio of Berkshire Hathaway has fluctuated over time, often trading at a premium to the S&P 500, with notable spikes in divergence around 2009 and 2020.
The P/E ratio of the S&P 500 has shown a more consistent upward trend since 2009, suggesting a general market willingness to pay more for earnings, which may reflect the index's shift towards higher-margin industries like technology.