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Capital Investments Power Berkshire Hathaway's Long-Term Growth
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Key Takeaways
Berkshire Hathaway invests heavily in BNSF and energy to fuel long-term growth.
BRK.B spent $14.1B in nine months of 2025, with $10.7B from BNSF and BHE.
BRK.B trades at 1.54x book, above industry, as 2026 EPS estimates signal a decline.
Berkshire Hathaway’s (BRK.B - Free Report) growth is tied to owning and expanding capital-intensive, infrastructure-driven businesses—BNSF Railway and Berkshire Hathaway Energy, being the important ones. These operations underpin the company’s strategy, emphasizing durable competitive advantages, predictable regulated returns and the ability to reinvest substantial amounts of capital over time.
Berkshire Hathaway’s railroad, utilities and energy businesses have considerable investments in capital assets and it will continue to pump in its resources going forward. In the first nine months of 2025, consolidated capital expenditures for property, plant and equipment, and equipment held for lease were $14.1 billion, which included capital expenditures by railroad, utilities and energy businesses (BNSF and BHE) of $10.7 billion. Notably, BNSF’s, the most important non-insurance subsidiary, capital expenditure is higher than what any other railroad has spent in a single year and represents an extraordinary amount compared with revenues, earnings or depreciation charges.
Railroads, utilities and energy transmission systems represent essential infrastructure with significant barriers to entry, making them difficult to replicate. Their scale and asset intensity generate consistent, recurring cash flows that are less sensitive to short-term market fluctuations. This stability strengthens Berkshire Hathaway’s earnings base while complementing its insurance businesses by supplying dependable operating cash that can be reinvested internally. Together, the resilience, scale and reinvestment potential of these assets remain central to the company’s sustained growth and long-term value creation.
What About Peers?
Union Pacific (UNP - Free Report) consistently channels significant capital into upgrading and expanding its rail network, locomotives, rolling stock and technology platforms. Through a multibillion-dollar annual investment plan, Union Pacific enhances track infrastructure, boosts capacity and improves operating efficiency, reinforcing its long-term competitive strength.
NextEra Energy (NEE - Free Report) commits sizable funds to regulated utility assets, renewable energy projects and transmission infrastructure. NextEra Energy’s continued spending on wind, solar and grid modernization supports steady rate base expansion.
Backed by disciplined capital allocation, NextEra Energy and Union Pacific generate resilient cash flows while broadening their essential infrastructure base.
BRK.B’s Price Performance
Shares of BRK.B have lost 1% year to date, underperforming the industry.
Image Source: Zacks Investment Research
BRK.B’s Expensive Valuation
BRK.B trades at a price-to-book value ratio of 1.53, above the industry average of 1.47. It carries a Value Score of D.
Image Source: Zacks Investment Research
No Estimate Movement for BRK.B
The Zacks Consensus Estimate for BRK.B’s first-quarter 2026 EPS witnessed no movement in the past seven days. The same holds true for 2026 EPS estimates.
Image Source: Zacks Investment Research
The consensus estimates for BRK.B’s 2026 revenues indicate year-over-year increases, while the same for 2026 EPS indicate a decline.
BRK.B stock currently carries a Zacks Rank #4 (Sell).
View the Zacks #1 Rank List
Image: Shutterstock
Capital Investments Power Berkshire Hathaway's Long-Term Growth
Key Takeaways
Berkshire Hathaway’s (BRK.B - Free Report) growth is tied to owning and expanding capital-intensive, infrastructure-driven businesses—BNSF Railway and Berkshire Hathaway Energy, being the important ones. These operations underpin the company’s strategy, emphasizing durable competitive advantages, predictable regulated returns and the ability to reinvest substantial amounts of capital over time.
Berkshire Hathaway’s railroad, utilities and energy businesses have considerable investments in capital assets and it will continue to pump in its resources going forward. In the first nine months of 2025, consolidated capital expenditures for property, plant and equipment, and equipment held for lease were $14.1 billion, which included capital expenditures by railroad, utilities and energy businesses (BNSF and BHE) of $10.7 billion. Notably, BNSF’s, the most important non-insurance subsidiary, capital expenditure is higher than what any other railroad has spent in a single year and represents an extraordinary amount compared with revenues, earnings or depreciation charges.
Railroads, utilities and energy transmission systems represent essential infrastructure with significant barriers to entry, making them difficult to replicate. Their scale and asset intensity generate consistent, recurring cash flows that are less sensitive to short-term market fluctuations. This stability strengthens Berkshire Hathaway’s earnings base while complementing its insurance businesses by supplying dependable operating cash that can be reinvested internally. Together, the resilience, scale and reinvestment potential of these assets remain central to the company’s sustained growth and long-term value creation.
What About Peers?
Union Pacific (UNP - Free Report) consistently channels significant capital into upgrading and expanding its rail network, locomotives, rolling stock and technology platforms. Through a multibillion-dollar annual investment plan, Union Pacific enhances track infrastructure, boosts capacity and improves operating efficiency, reinforcing its long-term competitive strength.
NextEra Energy (NEE - Free Report) commits sizable funds to regulated utility assets, renewable energy projects and transmission infrastructure. NextEra Energy’s continued spending on wind, solar and grid modernization supports steady rate base expansion.
Backed by disciplined capital allocation, NextEra Energy and Union Pacific generate resilient cash flows while broadening their essential infrastructure base.
BRK.B’s Price Performance
Shares of BRK.B have lost 1% year to date, underperforming the industry.
Image Source: Zacks Investment Research
BRK.B’s Expensive Valuation
BRK.B trades at a price-to-book value ratio of 1.53, above the industry average of 1.47. It carries a Value Score of D.
Image Source: Zacks Investment Research
No Estimate Movement for BRK.B
The Zacks Consensus Estimate for BRK.B’s first-quarter 2026 EPS witnessed no movement in the past seven days. The same holds true for 2026 EPS estimates.
Image Source: Zacks Investment Research
The consensus estimates for BRK.B’s 2026 revenues indicate year-over-year increases, while the same for 2026 EPS indicate a decline.
BRK.B stock currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.