Both Berkshire Hathaway and Soul Patts shares have made headlines recently. 

Berkshire Hathaway Inc (NYSE: BRK.A)(NYSE: BRK.B) was cast into the spotlight when its CEO of 60 years, Warren Buffett, announced his retirement in May. 

Earlier this month, Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) rose to prominence after it was announced that it could be acquiring Brickworks Ltd (ASX: BKW).

Both companies are known as market-beating investment conglomerates in their respective markets. 

Soul Patts' investments include listed equities, private equity, credit, and property. It provides exposure to a number of uncorrelated sectors, including resources, telecommunications, financial services, agriculture, and swimming schools. Berkshire Hathaway's operating segments can be broadly categorised into insurance, railroads utilities and energy, manufacturing, service, and retailing. 

Over the past five years, Soul Patts shares have increased by 107%, outperforming the S&P/ASX 200 Index (ASX: XJO), which is up 43%. Meanwhile, Berkshire Hathaway shares have risen 171% over five years, outpacing the S&P 500 Index (SP: .INX), which is up 93% over the same timeframe.

But, which is the better investment today? There are three distinguishing characteristics for investors to consider.

Dividend payments

It's no secret that Australian investors love to receive passive income. While Berkshire Hathaway shares have compounded at an annual growth rate of nearly 20% for more than 50 years, they have never paid a dividend. 

Soul Patts has the distinction of being the only ASX stock that has increased its dividend every year since 2000. Reliable passive income could lead some investors to prefer Soul Patts over Berkshire Hathaway.

Cash balance

Another factor to consider is their cash on hand to pursue new opportunities. Notably, Berkshire Hathaway has been building its cash balance. Over the past 10 quarters, Buffett has overseen more than US$174 billion in net stock sales, pushing his company's cash pile to an all-time high. Berkshire closed out the March quarter with a record US$347.7 billion in cash at its disposal to spend on future opportunities. 

Those who believe the market is currently overvalued and is due for a sell-off will likely see this as an opportunity. However, those who think global equity markets are fairly valued may be inclined to believe that Berkshire will underperform going forward. They may prefer to invest in Soul Patts, which has a much greater portion of its funds invested.

Leadership

Of course, another factor to consider is how Berkshire will perform after Buffett steps down. On 1 January 2026, Greg Abel is set to take the reins. Buffett has previously referred to Abel as a "dealmaker" and "huge asset for Berkshire Hathaway." However, since Buffett announced his retirement, Berkshire Hathaway's stock has drifted lower and now sits around 10% lower. This suggests the market could be nervous about the implications of this leadership change.

On the other hand, Soul Patts' Chairman Robert Millner is the fourth member of the Millner family to run Soul Patts. He first joined the firm in 1984 and is widely regarded as one of Australia's most experienced and respected investors.

Soul Patts' CEO Todd Barlow, who was appointed CEO in 2015, has also been with the company since 2004.

Foolish Takeaway

Both Berkshire Hathaway and Soul Patts shares have been outstanding long-term investments. Over the past five years, Berkshire has outperformed Soul Patts. However, with a large cash balance and a change of leadership next year, the next five years could look very different. Which company will do better over the next five or ten years? Only time will tell.