Don’t knock Buffett. His Berkshire Hathaway “shot” the S&P 500, says this fund manager

August’s jobs numbers hit a market that looked jittery again. The S&P 500 SPX fell 2.6% in three days of trading this week as many of the big tech names that led to a summer high faltered amid overvaluation fears. Nvidia NVDA is down 24% from its intraday peak.

But there was one well-known stock that hit a new high this week: Berkshire Hathaway BRK.A BRK.B.

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Warren Buffett’s insurance, utilities, transportation and investment conglomerate recently joined the $1 trillion market capitalization club. And such was its recent burst to a new high that its 14-day relative strength index, a gauge of momentum, rose above 85 at one point on Wednesday, according to MarketWatch data.

This overbought RSI has encouraged some profit-taking, but Berkshire is still up 28.3% for the year to date.

Such a performance is ammunition for Christopher Bloomstran, the longtime Berkshire investor and co-owner of investment firm Semper Augustus Investments, who this week, in an X missive, took The Economist to task, whose Schumpeter column blasted a look at Berkshire’s recent stock market. turns around and asked “Warren Buffett has lost his touch.”

Struggling with Bloomstran’s words! And an all-caps accent duly followed.

He notes that Schumpeter says Berkshire has earned “roughly” what the S&P 500 has done over the past ten years. “No,” says Bloomstran. “Berkshire has outperformed. And that’s because Berkshire ALREADY pays taxes on the dividends it receives, where taxable investors have to pay tax on dividend distributions from funds/ETFs, reducing after-tax returns.”

Bloomstran says The Economist cherry-picked their data and, in fact, “Berkshire has been taking the S&P behind the woodshed lately and hitting it.”

He notes that over the past decade, Berkshire has returned 246.4% compared to 230.9% for the S&P 500, but the Economist decided to examine a 14-year comparison in which the latter managed to outperform. “Really? Fourteen? That’s right after the financial crisis. In fact, in all but TWO annual intervals of the past 59 years, BRK has won, and generally by a LOT,” Bloomstran writes.

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Another area of ​​contention is the Economist’s comparison of Berkshire to Apple AAPL and Microsoft MSFT. The magazine says the two tech giants have more than three times the annual profit of Berkshire, Bloomstran notes.

“Serious? BRK’s annual economic earnings are about $60 billion (earning more at the moment as they earn almost $15 billion from their government bonds alone).

Apple, he says, currently earns about $100 billion (which is not three times Berkshire’s $60), while the iPhone maker is capitalized at more than $3 trillion, or about 34 times earnings. Microsoft earns $88 billion and also has a market cap of about $3 trillion, equivalent to about 35 times earnings.

“Meanwhile, Berkshire has a multiple of 16.7 times, higher than in recent years, but still a discount to my intrinsic value assessment,” says Bloomstran.

An unsuspecting Economist reader “might conclude that the index is a better investment than BRK,” says Bloomstran. “At what is likely to be a secular peak in the index, this is a very dangerous suggestion.”

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US stock index futures ES00 YM00 NQ00 recovered losses after benchmark jobs data on Treasury yields BX:TUBMUSD10Y . The DXY dollar index is down, while CL.1 oil is up and GC00 gold is trading around $2,528 an ounce.

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August’s nonfarm payrolls report showed 142,000 net jobs were added, up from July’s downwardly revised 89,000 but lower than the 161,000 expected by economists.

The jobless rate was in line with forecasts at 4.2 percent, and hourly wages rose 0.4 percent on the month. higher than the revised down minus 0.1% in July and above forecasts of 0.3%.

New York Fed President John Williams speaks at a Council on Foreign Relations event at 8:45 a.m., and Fed Governor Christopher Waller comments on the economic outlook at 11 a.m. — the last speaker before the Fed to keep quiet before his next tariff decision.

Shares of Broadcom AVGO fell nearly 10% in premarket shares after its earnings guidance failed to meet investor expectations.

Salesforce CRM announced a deal to acquire cloud startup Own Co late Thursday. for approximately $1.9 billion in cash.

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