Berkshire Growth Challenged by Size and Market Conditions, Future Outperformance Seen as Less Likely
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Berkshire Hathaway's stock has kept pace with the S&P 500, but future "eye-popping performance is not feasible" given its size and the market conditions.
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Buffett noted it's getting harder for Berkshire to find impactful investment opportunities in the U.S. and overseas.
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Beating the market will likely become more difficult for Berkshire as its massive size limits the effect of share repurchases.
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Berkshire faced unforeseen regulatory and market share challenges in recent quarters impacting its utilities and insurance businesses.
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The author maintains a Neutral/Hold rating on Berkshire stock as it remains a strong business, but growth is expected to be modest and market outperformance less likely.