“Expensive” is a relative term when discussing the stock market. Many investors measure a share’s cost by the stock’s price relative to its earnings or sales.
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However, some become drawn to a company’s shares merely because of the quoted price. One stock has become so expensive that a single share is worth more than a house in many parts of the country. Although it might be hard to comprehend how a share could carry such value, a stock’s price may not represent the value of a company as well as some might assume.
What Is the Highest Stock Price Right Now?
As noted, investors can determine the highest-priced stock in multiple ways. For this article, GOBankingRates defined “expensive” by the quoted stock price.
The most expensive stock in terms of the stock price is an A share of Berkshire Hathaway (NYSE: BRK.A). This stock closed at $689,286.60 per share on Sept. 6. Warren Buffett, the company’s longtime owner, is the one who helped take these shares to such heights.
About Berkshire Hathaway
Berkshire Hathaway is involved in a number of different business activities, with subsidiaries operating in industries ranging from insurance to real estate, energy and utilities, rail freight, food service and consumer products like jewelry, furniture and housewares.
Some of its well-known brands include:
Geico
Dairy Queen
Oriental Trading Company
Duracell
Fruit of the Loom.
Despite the popularity of the brands Berkshire Hathaway owns, many know it best for its stock holdings. In fact, investors wait for Buffett to release his annual letter to shareholders each year, in part because the letters list Berkshire Hathaway’s holdings. These consist of a portfolio of well-known companies, with Apple constituting its largest holding in terms of market value and Bank of America topping the list in terms of number of shares owned.
Berkshire Hathaway Stock
Berkshire Hathaway stock has reached its price for two primary reasons. One is Buffett’s aversion to stock splits. As the term implies, a stock split divides the shares into multiple pieces. Say, for example, you own 100 shares of Company X at $100 per share. If that company instituted a 4-for-1 stock split, shares would separate into four equal parts. This would give you 400 shares of Company X at $25 per share.
The second reason is earnings growth. Stocks tend to trade at a multiple of their earnings. Over time, Berkshire has experienced massive growth.
In 1965, the company reported gains of just under $4.85 million. By 2019, the most recent year with revenue unaffected by the pandemic, the company reported net earnings of more than $21 billion, or $49,828 per share. This means that profits increased almost 17,000-fold between 1965 and 2019.
Earnings per share have more recently been more volatile, and they saw negative growth in 2022. However, Buffett wrote in a February 2023 letter to shareholders that the company “will always hold a boatload of cash and U.S. Treasury bills.” Berkshire Hathaway has gained roughly $204.55 billion in market value since the beginning of the year, and the stock is up over 28%.
Berkshire’s A shares have never split. However, to attract small investors, the company introduced B shares (NYSE: BRK.B). Today, a B share is about 1/1,500 the size of an A share. Smaller shareholders often invest in the company through shares of BRK.B, which had a closing price of $459.42 per share on Sept. 6.
What Are the 10 Most Expensive Stocks Right Now?
Berkshire Hathaway is far from the only stock that has risen to a high share price. These are the most expensive stock shares as measured by the closing share price on Sept. 6.
1. Berkshire Hathaway Inc. (BRK.A)
Price: $689,286.60 per share
Market Capitalization: $998.84 billion
Net Income (2023): $96.22 billion
Services Provided: Insurer, holding company
Competitors and Similar Companies: Allstate, Progressive
2. NVR Inc. (NVR)
Price: $9,068.54 per share
Market Capitalization: $28.20 billion
Net Income (2023): $1.59 billion
Services Provided: Home building, mortgage banking
Competitors and Similar Companies: D.R. Horton, Lennar
3. Booking Holdings Inc. (BKNG)
Price: $3,731.35 per share
Market Capitalization: $125.91 billion
Net Income (2023): $4.29 billion
Services Provided: Online travel services
Competitors and Similar Companies: Expedia, Tripadvisor
4. Seaboard Corp. (SEB)
Price: $3,147.27 per share
Market Capitalization: $3.04 billion
Net Income (2023): $226 million
Services Provided: Food, shipping, commodity trading
Competitors and Similar Companies: Bunge, Tassal Group
5. AutoZone Inc. (AZO)
Price: $3,092.56 per share
Market Capitalization: $53.31 billion
Net Income (2023): $2.53 billion
Services Provided: Retail automotive replacement parts and accessories
Competitors and Similar Companies: O’Reilly Auto Parts, Advance Auto Parts
6. MercadoLibre Inc. (MELI)
Price: $1,986.05 per share
Market Capitalization: $101.81 billion
Net Income (2023): $987 million
Services Provided: Internet retail
Competitors and Similar Companies: Sea Limited, Global-e Online Ltd., Etsy Inc.
7. First Citizens BancShares Inc. (FCNCA)
Price: $1,898.10 per share
Market Capitalization: $27.51 billion
Net Income (2023): $11.41 billion
Services Provided: Banks, regional
Competitors and Similar Companies: M&T Bank Corp., Mizuho Financial Group Inc.
8. Fair Isaac Corp. (FICO)
Price: $1,734.01 per share
Market Capitalization: $43.19 billion
Net Income (2023): $429.38 million
Services Provided: Technology, software
Competitors and Similar Companies: Intuit, Paycom Software, Cadence Design Systems
7. White Mountains Insurance Group Ltd. (WTM)
Price: $1,757.51 per share
Market Capitalization: $4.50 billion
Net Income (2023): $502 million
Services Provided: Insurance, financial services
Competitors and Similar Companies: The Hanover Insurance Group, Axis Capital
10. Markel Group Inc. (MKL)
Price: $1,533.79 per share
Market Capitalization: $19.95 billion
Net Income (2023): $1.97 billion
Services Provided: Property and casualty insurance
Competitors and Similar Companies: White Mountains Insurance Group, Travelers, Progressive, Allstate
Investing In Expensive Stocks
At first glance, investing in expensive stocks might seem out of reach to the average investor and beginner investors.
Indeed, in previous decades, stocks might split to attract average investors. That was one reason cited for Amazon’s split in June 2022. They might also split to earn a place or stay on the Dow Jones index. Because the Dow is price-weighted, shares with high prices can wield a disproportionate influence on the index, prompting the Dow to drop the company to keep the index in balance. Many believe that was one major factor in Apple’s 2020 4-for-1 stock split.
B shares and stock splits aren’t your only option for owning shares in these ultraexpensive companies. Thanks to trading apps such as Robinhood, smaller investors can now buy fractional shares. Hence, splits may become more infrequent than in previous decades.
Moreover, investors tend to evaluate stock prices relative to earnings. Given this measure, investors might happily pay $689,286.60 per share when it produces tens of thousands of dollars per share in returns in a single year, as Berkshire Hathaway typically does. Conversely, $$1,734.01 per share for Fair Isaac may appear expensive in comparison, with its much smaller earnings — about $19 — relative to share price.
It’s important to remember that while a high share price might result from significant growth in the past, it’s not always a reliable indicator of the best stock to buy for the future.
Daria Uhlig contributed to the reporting for this article.
Data was compiled on Sept. 9, 2024, and is subject to change.
This article has been updated with additional reporting since its original publication.
This article originally appeared on GOBankingRates.com: Top 10 Highest-Priced Stocks Right Now
