Today we’re going to discuss the most expensive stock on the stock market. But we’ll also cover the rest of the top five most expensive stocks. And we’ll ask the question, “In a market full of various metrics, how should we define ‘expensive.'”
Berkshire Hathaway A shares were worth $7.50 each in 1962. That’s when a young Warren Buffett first invested in the company. Buffett gained a controlling percentage of the company in 1965 and has been their CEO ever since. The company has grown 46000 times bigger since then. And because Berkshire has never split their stock’s A shares, they are the most expensive stock on the market.
Berkshire Hathaway is a holding company. Put another way; it’s a company made up of other companies. Berkshire Hathaway has partial- or full-ownership over dozens of other companies, including many that you’ve heard of.
Whether intentional or not, some companies get mentioned in “most expensive stock” articles simply because they’ve never split stocks, and therefore have a very high price. Good marketing? Or an accidental benefit? You’re right. So let’s take a look at market capitalization and the price-to-earnings ratio.
Market capitalization is a way of measuring how much money (or capital) a company is worth across the stock market. Total capital in the market = market capitalization. And the equation for finding market capitalization—or market cap—is easy. Take the total number of shares of a company and multiply by the company’s price per share.