Over the past five years, the returns produced by Warren Buffett have surpassed those of the S&P 500 and the Nasdaq Composite, even as Berkshire Hathaway holds hundreds of billions of dollars in cash and Treasury securities.
In a recent podcast episode, Motley Fool analyst Jim Gillies joined host Ricky Mulvey to discuss a range of topics, including:
- The role of Apple in driving Berkshire Hathaway’s performance.
- The stagnation in Disney’s returns over the past five years.
- A jeans manufacturer that is outperforming the market.
Additionally, Motley Fool personal finance expert Robert Brokamp and host Alison Southwick conversed about the benefits of taking a day to assess one’s financial health.
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Note: The video included in the article was recorded on March 25, 2025.
In a conversation between Ricky Mulvey and Jim Gillies, they explored long-term investment cycles, spotlighting Berkshire Hathaway’s performance as it maintained a significant portion of its market capitalization in cash. While the Nasdaq rose approximately 170% and the S&P 500 almost 140%, Berkshire Hathaway saw a 200% increase. This outperformance was noted despite common concerns that cash could weigh down investments. Gillies attributed much of this performance to Apple’s success, while acknowledging that Buffett’s divestments from less successful investments, such as airlines during the COVID-19 pandemic, played a part. Buffett’s consistent adherence to long-term investment principles in a changing market, including his focus on reasonable valuations and investments in Japanese trading houses, was highlighted.
The discussion also touched on the speculation surrounding Buffett’s increased cash position, suggesting it was more a strategic positioning for Berkshire’s future leadership rather than anticipating a market crash. The conversation highlighted Buffett’s legacy planning for Berkshire without his leadership and emphasized the importance of maintaining discipline in long-term investment strategies.
Switching focus, they discussed Disney’s underperformance, attributing it to changes in the entertainment industry landscape and the challenges faced by the company in a saturated market. Large budgets for movie productions like "Indiana Jones and the Dial of Destiny" and "Snow White" were cited as financial risks, especially with the decline of physical media income.
Lastly, the conversation turned towards lesser-known companies, spotlighting Kontoor Brands, the parent company of Lee and Wrangler Jeans, as a strong performer. Despite facing challenges in 2020, the company rebounded significantly, demonstrating strong cash flow and capital allocation, making it an attractive investment opportunity.
As the podcast concluded, Alison Southwick and Robert Brokamp discussed the value of taking a financial health day to tackle often-neglected financial tasks. They emphasized the mental and financial benefits of using a dedicated day to make substantial improvements in personal finance, supported by examples of tasks and potential financial improvements over time.
The episode concluded with a reminder that investing decisions should be made independently of the program’s discussions, which are aligned with Motley Fool’s editorial standards and recommendations.
