Warren Buffett stepped down as CEO of Berkshire Hathaway (NYSE: BRK-B | BRK-B Price Prediction) on December 31, 2025, after six decades leading the conglomerate he transformed from a struggling textile mill into a $1 trillion empire. The “Oracle of Omaha” left his successor, Greg Abel, with a very concentrated portfolio. Abel, who has served as vice chair overseeing non-insurance operations, officially took over as chief executive on January 1, 2026. At 95 years old, Buffett isn’t fully retiring; he will remain board chair and plans to continue coming to the Omaha headquarters as much as before. However, he has stated he will be “going quiet” and leaving all decision-making to Abel.
Long-time investors and Buffett mavens are familiar with this quote: “His favorite holding for an S&P 500 stock is forever.” So it’s not surprising to report that for all the success and stature Berkshire Hathaway has in the investment world, five top companies still make up 65% of the portfolio’s total holdings. While much more concentrated than most portfolio managers would ever consider, the strategy has worked for Berkshire Hathaway investors for years. It will likely continue to do so, though it’s a solid bet that Abel and his team will expand the portfolio when opportunities arise, especially given that the portfolio holds almost $400 billion in short-term Treasury bills.
Given that Berkshire Hathaway stock has moved higher from levels printed earlier this year, we decided to scan the portfolio for the five cheapest stocks on a price-to-earnings basis. Interestingly, all five are also dividend-paying companies that reward shareholders with reliable payouts year in and year out. Plus, three are financials, which tend to do well in a rising-rate environment, which may occur if inflation remains sticky throughout the rest of the year.
Why do we cover Berkshire Hathaway stocks?
Few investors have the results and reputation that Buffett has garnered over the past 60 years. Though he has stepped away from the CEO chair, his impact and investment guidelines are likely to remain in place long after he is gone. While investing has evolved since Buffett took control of Berkshire Hathaway in 1965, and now that Abel is in charge, vowing to stay the course, buying good companies with globally recognized products and services that pay dividends will always remain a timeless approach.
Here are the five Berkshire Hathaway companies with the lowest price-to-earnings metrics.
Ally Financial
Formerly known as GMAC, this bank with no buildings posted solid first-quarter earnings, offers a solid 2.65% dividend, and trades at a tiny 8.34 times forward earnings. Ally Financial (NYSE: ALLY), a pioneer in the digital financial services industry, offers a diverse range of innovative digital financial products and services to consumer, commercial, and corporate customers, primarily in the United States and Canada.
It operates through four segments:
- Automotive Finance Operations
- Insurance Operations
- Mortgage Finance Operations
- Corporate Finance Operations
The Automotive Finance Operations segment offers:
- Automotive financing services, including retail installment sales contracts
- Loans and operating leases
- Term loans to dealers
- Financing dealer floor plans and other lines of credit to dealers
- Warehouse lines to automotive retailers
- Fleet financing
It also funds companies and municipalities to purchase or lease vehicles and to use vehicle remarketing services.
The Insurance Operations segment offers consumer finance protection and insurance products through the automotive dealer channel, and sells commercial insurance products directly to dealers. This segment provides vehicle service and maintenance contracts and guaranteed asset protection products, and underwrites commercial insurance coverages that primarily insure dealers’ vehicle inventory.
The Mortgage Finance Operations segment manages a consumer mortgage loan portfolio that includes bulk purchases of jumbo and low-to-moderate-income mortgage loans from third parties, as well as direct-to-consumer mortgage offerings.
The Corporate Finance Operations segment provides senior secured, leveraged cash flow, and asset-based loans to middle-market companies, as well as leveraged loans and commercial real estate products to companies in the healthcare industry.
The company also offers commercial banking products and services, securities brokerage, and investment advisory services.
Bank of America
Though Buffett trimmed his position over the past two years, and sold a whopping 50 million Bank of America (NYSE: BAC) shares in the fourth quarter, this quality financial giant remains an exceptional long-term holding. Berkshire Hathaway still owns 517,295,934 shares, which is 8.1% of the portfolio and 7.2% of the float.
The bank holding company and financial holding company reported impressive Q4 results. It offers a solid 1.89% dividend yield, and shares trade at 12.7 times forward earnings.
Its segments include:
- Consumer Banking, which offers a range of credit, banking, and investment products and services to consumers and small businesses.
- Global Wealth & Investment Management (GWIM), which includes two businesses: Merrill Wealth Management offers tailored solutions to meet clients’ needs through a comprehensive suite of investment management, brokerage, banking, and retirement products. Bank of America Private Bank provides comprehensive wealth management solutions.
- Global Banking offers a range of lending-related products and services, including integrated working capital management and treasury solutions, as well as underwriting and advisory services.
- Global Markets offers sales and trading services, as well as research services, to institutional clients across fixed income, credit, currency, commodity, and equity markets.
Capital One Financial
Capital One Financial (NYSE: COF), the “what’s in your wallet” bank, pays a solid 1.37% dividend, and its shares trade at just 9.69 times forward earnings projections. This diversified financial services holding company with banking and non-banking subsidiaries offers a broad spectrum of financial products and services to consumers, small businesses, and commercial clients through various channels. It operates through three segments.
The Credit Card segment consists of domestic consumer and small-business card lending, as well as international card businesses in the United Kingdom and Canada.
The Consumer Banking segment consists of deposit gathering, consumer and small-business lending, and national auto lending, while the Commercial Banking segment consists of its lending, deposit gathering, capital markets, and treasury management services to commercial real estate and commercial and industrial customers.
Its principal operating subsidiary is Capital One, National Association, which offers banking products and financial services.
Delta Air Lines
This is a new addition to the portfolio that Abel and his team acquired. Delta Air Lines (NYSE: DAL) trades at 13.5 times trailing earnings and offers a 0.81% dividend yield, providing value. The carrier provides scheduled air transportation for passengers and cargo throughout the United States and around the world, with hubs and markets in:
- Amsterdam
- Atlanta
- Bogota
- Boston
- Detroit
- Lima
- London-Heathrow
- Los Angeles
- Mexico City
- Minneapolis-St. Paul
- New York-JFK and LaGuardia
- Paris-Charles de Gaulle
- Salt Lake City
- Santiago (Chile)
- Sao Paulo
- Seattle
- Seoul-Incheon
- Tokyo
Its segments include Airline and Refinery. The Airline segment is managed as a single business unit that provides scheduled air transportation for passengers and cargo globally, including its loyalty program and other ancillary businesses. The Refinery segment operates for the benefit of the Airline segment by providing jet fuel to it from its own production and through third-party agreements. The refinery’s production consists of jet fuel and non-jet fuel products.
Sirius XM
The satellite radio stock was first added to the Berkshire Hathaway portfolio in 2016, and Buffett has continued to increase his stake over the past few years, which has proven to be genius. Sirius XM (NASDAQ: SIRI) is an audio entertainment company in North America that pays shareholders a dividend yield of 3.89% and trades at just nine times forward earnings.
The company has a portfolio of audio businesses, including its flagship subscription entertainment service Sirius XM, the ad-supported and premium music streaming services of Pandora, an expansive podcast network, and a suite of business and advertising solutions.
The Sirius XM segment offers a variety of content, including music, sports, entertainment, comedy, talk, news, traffic, and other channels, as well as podcasts and infotainment services, in the United States for a subscription-based fee. Sirius XM’s packages include live, curated, and specific exclusive and on-demand programming.
The Pandora and Off-platform segment operates a music, comedy, and podcast streaming discovery platform, offering a personalized experience for each listener, whenever and wherever they want to listen, across mobile devices, vehicle speakers, and connected devices.
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