Every year, Warren Buffett writes a letter to Berkshire Hathaway’s shareholders.

And every year, investors around the world pay close attention.

These letters are more than just company updates.

They’re packed with lessons about investing, running a business, and human psychology.

The 2024 letter that got released this weekend is no different, and offers valuable insights for anyone looking to learn from one of the world’s greatest investors.

Why Buffett’s Letters Matter

Buffett’s letters are known for being honest and easy to understand.

He breaks down complicated financial topics in a way that makes sense to both beginners and experienced investors.

He also talks openly about his wins, mistakes, and views on the market.

Over the years, these letters have become a go-to guide for anyone wanting to understand how Buffett thinks and operates.

Big Takeaways from the 2024 Letter (Released on Saturday)

1. Strong Financial Results – Berkshire Hathaway had a solid year, with a 71% jump in earnings during the fourth quarter of 2024.
   
   The company’s cash reserves also hit a record high of $334 billion.
   
   Buffett explained that while they’re ready to invest this cash, they’re only going to do so when the right opportunities come along. In other words, Buffett also believes stocks are currently expensive…

2. Changes in the Investment Portfolio – One of the biggest moves in 2024 was Berkshire reducing its stake in financial stocks.
   
   Over the last year (ended Dec. 31), Berkshire's respective stakes in BofA, Citigroup, and Capital One Financial have been reduced by 34%, 74%, and 40%
   
   At the same time, the company increased its investment in Constellation Brands, a company that offers three traits Buffett typically looks for in an investment
   
   First, it has an easy-to-understand business model with predictable consumer buying habits
   
   Second, the company boasts a strong capital-return program, regularly paying over $1 per share in quarterly dividends while steadily buying back its stock
   
   Lastly, its valuation is likely attractive to Buffett – trading at less than 12 times projected earnings for fiscal 2026.

3. Planning for the Future – Buffett, now 94, addressed the future leadership of Berkshire Hathaway.
   
   He confirmed that Greg Abel, a longtime vice chairman, is set to take over as CEO when the time comes.
   
   Buffett assured shareholders that Abel shares the same values and will keep the company’s culture intact.

4. Learning from Mistakes – True to his reputation for humility, Buffett discussed past investment missteps, emphasizing the importance of acknowledging and learning from errors.
   
   He highlighted the dangers of "thumb-sucking," or procrastination, advocating for prompt action when faced with challenges.
   
   This introspection serves as a reminder that even the most successful investors encounter setbacks and that growth often stems from confronting and rectifying mistakes.

Buffett’s annual letters offer more than just a look at Berkshire Hathaway’s performance. They’re a masterclass in investing, business strategy, and economics.

Each letter distills decades of hard-earned wisdom into simple, relatable lessons.

For anyone serious about investing or running a business, making time to read these letters every year is a no-brainer.

The 2024 edition reinforces why Buffett’s insights continue to stand the test of time.

No matter your experience level, there’s always something valuable to take away from his words.

Click here to read the latest letter.