No. of Recommendations: 1
Berkshire seems to be finding attractive investments in the insurance area, even as it is eschewing equity investments in the last few years.
They bought Allegheny in Oct 22 for $11.6 billion, spent $8 billion on Chubb starting 2025 Q3 and now $1.8 billion on Tokio Marine, which is likely to rise as they have management’s agreement to buy upto 10% (they now own 2.5%).
I too have felt that many other insurers like Fairfax Financial, Markel and Progressive are undervalued, but hesitate to add even more to my substantially overweight insurance holdings. There are no clear company-specific issues affecting them, so it is likely Berkshire is also similarly undervalued. Maybe with substantial stock repurchases and insurance company investments, and stagnant/declining railroad, utilty and MSR segments, Berkshire itself will become more of an insurance business.
In an expensive market, very few other sectors like packaged foods, alcoholic beverages, and oil & gas ( till a few weeks ago) are beaten down.
