3/4 of "FANG" Companies Now Worth Same or More Than Berkshire Hathaway
For a brief moment earlier today, Facebook was worth more than Berkshire Hathaway.
As a matter of fact, for a few moments today, 3/4ths of the FANG companies (Facebook, Amazon, Netflix and Google) were worth more than the conglomerate named Berkshire Hathaway. Only Netflix, which is currently valued at $39.12 billion, was worth less.
Here are the market capitalizations of Berkshire Hathway compared to Facebook, Amazon and Google as of the end of business today:
Berkshire Hathaway, $355.9 billion
Facebook, $354.51 billion
Amazon, $358.03 billion
Google, $543.3 billion
Facebook, with $20 billion+ in annual revenue projected for 2016 and a P/E ratio is over 75, is available for the same price as Berkshire Hathaway, which is about as blue chip of an enterprise as you will get. While Facebook is still growing like crazy and is still valued as a growth company, Berkshire Hathaway, with its insurance, chemicals and railroad businesses, just to name a few, is obviously valued differently. In the end, however, you are left with two companies that could be bought for roughly the same price.
Berkshire Hathaway owns many businesses outright. According to Buffett, roughly a dozen of their wholly owned businesses could be listed on the S&P 500. Here is a full list of the Berkshire Hathaway companies:
Acme Brick Company
Ben Bridge Jeweler
Benjamin Moore & Co.
Berkshire Hathaway Automotive
Berkshire Hathway Energy Company
Berkshire Hathaway GUARD Insurance Companies
Berkshire Hathaway Homestate Companies
Berkshire Hathaway Specialty Insurance
BH Media Group
Borsheims Fine Jewelry
Buffalo NEWS, Buffalo NY
Central States Indemnity Company
CORT Business Services
Fechheimer Brothers Company
Fruit of the Loom Companies
Gateway Underwriters Agency
GEICO Auto Insurance
H.H. Brown Shoe Group
HomeServices of America
International Dairy Queen, Inc.
IMC International Metalworking Companies
Louis-Motorcycle & Leisure
Marmon Holdings, Inc.
National Indemnity Company
Nebraska Furniture Mart
Oriental Trading Company
Precision Castparts Corp.
Precision Steel Warehouse, Inc.
RC Willey Home Furnishings
Scott Fetzer Companies
United States Liability Insurance Group
In addition, Berkshire Hathaway maintained the following sizeable stakes in publicly traded companies as of the end of Q1/2016:
Bank of New York Mellon Corp
Davita Healthcare Partners
Deere & Co.
Johnson & Johnson
M&T BK Group
Media Gen Inc.
Proctor & Gamble
Restaurant Brands Intl
Twenty First Century Fox
Axalta Coating Sys
Liberty Global Plc
On top of all of that, Berkshire Hathaway has billions of dollars in cash that is sitting, ready to be deployed. Berkshire Hathaway's wholly owned businesses and stakes in publicly traded companies throw off over a billion in cash for the conglomerate each and every month.
Facebook, on the other hand, continues to battle with Google to become the largest advertising platform on the Internet.
After some initial pains, Facebook has figured out how to monetize their mobile users. The results have been phenomenal - Facebook reported earnings of 97 cents per share last quarter on revenues of $6.44 billion, easily surpassing analyst estimates. The company continues to grow daily active users at a steady clip and has a number of potential monetization avenues available down the road, including virtual reality headsets, increased Instagram/Whatsapp advertisements and search.
When the smoke clears and Facebook's growth starts to slow, as it inevitably will, how will its value compare to that of Berkshire Hathaway?
Filed under: General Market News