The most diversified companies in the world today are Berkshire Hathaway, Siemens, Samsung, and Honeywell, each generating meaningful revenue across industries that have little in common operationally. The list is shorter than it would have been a decade ago. General Electric, Danaher, Johnson & Johnson, and 3M have all broken themselves into focused pieces, and the companies that remain diversified at scale now stand out as exceptions to a strong trend toward focus.
Berkshire Hathaway
Berkshire Hathaway is the textbook modern conglomerate. Its 2024 annual report shows wholly-owned businesses spanning insurance (GEICO, General Re, Berkshire Hathaway Reinsurance Group), freight rail (BNSF), energy generation and utilities (Berkshire Hathaway Energy), manufacturing (Precision Castparts, Duracell, Shaw Industries, and dozens more), retail and services (Pilot Travel Centers, Dairy Queen, See’s Candies), and distribution (McLane Company).1Berkshire Hathaway Inc. 2024 Annual Report On top of the operating businesses, the holding company maintains an enormous equity investment portfolio.
No operational synergy connects a candy company to a freight railroad. The logic is purely financial. Insurance operations generate a large float of investable capital, and the parent deploys that capital wherever it sees the best risk-adjusted returns. In 2024, Berkshire’s consolidated sales and service revenues exceeded $211 billion, with manufacturing contributing roughly $155 billion and railroad, utilities, and energy totaling about $49.8 billion.1Berkshire Hathaway Inc. 2024 Annual Report
Siemens
The German industrial group Siemens reports five business segments: Digital Industries, Smart Infrastructure, Mobility, Siemens Healthineers, and Siemens Financial Services.2Siemens. Earnings Release Q4 FY 2025 That portfolio covers factory automation software, power grid infrastructure, rail transport systems, medical imaging equipment, and commercial finance. Few companies span that many distinct industries with meaningful revenue in each.
Siemens has already shed some diversification by spinning off its energy business as Siemens Energy in 2020, but it retains one of the broadest industrial portfolios in the world. Its Healthineers division alone is a major standalone medical technology company that happens to sit inside a larger conglomerate.
Samsung
Samsung operates through three major divisions: Consumer Electronics, IT and Mobile Communications, and Device Solutions, which houses its semiconductor and display panel businesses.3Samsung. Business Area Device Solutions regularly generates a large share of the company’s profit. The consumer electronics arm (televisions, home appliances) and the mobile division (Galaxy smartphones) each bring in enormous revenue from completely different customer bases and competitive conditions. The broader Samsung Group also includes shipbuilding, construction, life insurance, and other businesses held through a network of affiliates.
Honeywell
Honeywell operates across four reportable segments as of 2026: Aerospace Technologies, Building Automation, Industrial Automation, and Process Automation and Technology.4Honeywell. Honeywell Announces Updated Business Segment Structure Ahead of Aerospace Spin-Off Its aerospace division supplies propulsion systems, cockpit electronics, and navigation technology used on commercial and defense aircraft platforms. Its building automation arm installs fire prevention, climate controls, and security systems in millions of buildings worldwide. The industrial and process automation divisions serve chemical plants, refineries, and factories.
Honeywell’s diversification is the “related” variety. A common thread of engineering, sensor technology, and software integration runs through divisions that otherwise serve very different customers. The company has announced plans to spin off its aerospace business into a standalone entity, which would narrow the portfolio further.
Related vs. Unrelated Diversification
These four companies illustrate two fundamentally different approaches. Related diversification means expanding into industries that share technology, distribution channels, or core expertise with the existing business. Honeywell’s move from aerospace sensors to building automation sensors is the classic example. Shared R&D and manufacturing capabilities are supposed to make the combined company more competitive than the pieces would be alone.
Unrelated diversification means buying into industries that have nothing in common with existing operations. Berkshire owning both Benjamin Moore paint and FlightSafety pilot training reflects that approach. No shared customers, no shared technology, no operational synergy. The rationale is financial: the parent believes it can allocate capital more efficiently than public markets, moving cash from mature businesses into higher-return opportunities elsewhere. Management typically pursues this path when the core business generates more cash than it can reinvest at attractive returns. The tradeoff is that the approach demands capital allocation skill from headquarters rather than operational expertise, and most management teams turn out to be mediocre capital allocators.
Why the List Keeps Shrinking
The long-term trend among large diversified companies has been toward narrowing portfolios. Several iconic conglomerates have broken themselves apart recently.
General Electric completed its transformation in 2024, splitting into three independent public companies: GE Aerospace, GE Vernova (energy), and GE HealthCare.5General Electric. GE Spin-Off Resources GE had been the most famous American conglomerate for over a century. The breakup reflected a consensus that the combined entity was worth less than its parts and that focused management teams would perform better.
Danaher followed a similar path. Once a sprawling industrial conglomerate, it systematically spun off its industrial businesses as Fortive in 2016, its dental businesses as Envista in 2019, and its environmental and applied solutions segment as Veralto in 2023.6Danaher. About Danaher What remains is a company focused on life sciences and diagnostics with three segments: Biotechnology, Diagnostics, and Life Sciences.7Danaher. Our Businesses
Johnson & Johnson spun off its consumer health division as Kenvue in 2023, leaving the parent with two segments: Innovative Medicine and MedTech.8Johnson & Johnson. Johnson and Johnson Reports Q4 and Full-Year 2025 Results 3M now operates three business groups (Safety & Industrial, Transportation & Electronics, and Consumer) after spinning off its healthcare business as Solventum in 2024.93M. Success Driven by Four Business Groups
The pattern is consistent. Companies once held up as diversification success stories have concluded that focus creates more shareholder value than breadth. The exceptions that remain diversified tend to have either unique capital allocation advantages or governance structures (like Samsung’s chaebol network) that make breakups impractical.
The Conglomerate Discount
The main reason conglomerates break apart is the conglomerate discount: the gap between what the stock market values the combined company at and what the individual business units would be worth if they traded separately. Research consistently finds that diversified companies trade at a discount to the sum of their parts, typically in the range of 5% to 15%, with some European studies finding discounts as steep as 20%.
Several factors compound. Investors prefer to build their own diversified portfolios using focused pure-play companies rather than owning a pre-assembled collection of businesses they cannot customize. Centralized management teams cannot be experts in every industry a conglomerate spans, which leads to slower decisions and misallocated capital. When a conglomerate mixes cyclical businesses with stable ones, lenders price debt based on the blended risk profile rather than giving stable divisions the cheaper financing they would get standalone.
Not every conglomerate suffers the discount equally. Berkshire Hathaway has historically traded at or near its sum-of-parts value because the market trusts its capital allocation track record. For most diversified companies, though, the discount is a persistent drag and the main reason activist investors push for breakups.
How to Analyze a Diversified Company
A single price-to-earnings ratio is useless for a company whose divisions operate in completely different economic environments. Two tools do the real work.
Segment Reporting
Public companies must separately disclose financial data for any operating segment whose revenue, profit or loss, or assets reach 10% of consolidated totals, under FASB ASC Topic 280.10Financial Accounting Standards Board. Segment Reporting That data lets you calculate return on assets, operating margins, and growth rates for each division independently. When Berkshire reports that manufacturing businesses generated $155 billion in revenue while the railroad earned $24 billion, you can assess each against its own industry peers rather than averaging them into a meaningless composite.
Sum-of-the-Parts Valuation
The standard valuation tool for conglomerates is sum-of-the-parts. You value each business segment as if it were an independent public company, applying the valuation multiples its pure-play competitors command. A manufacturing unit might warrant 8 times EBITDA while a software division deserves 20 times. Blending them into a single multiple would undervalue the software business and overvalue the manufacturing one.
After calculating enterprise value for each segment, you add them, then subtract consolidated net debt and any minority interests. The result is implied equity value. When that number significantly exceeds market capitalization, you have identified a potential conglomerate discount and a possible investment opportunity. This is how virtually every analyst covers Berkshire Hathaway, and it is the methodology that often identifies breakup candidates.
A Note on Structure, Tax, and Antitrust
Readers researching diversified companies sometimes assume tax or antitrust rules explain why the biggest ones look the way they do. They matter less than the valuation math above. On the tax side, when a parent owns at least 80% of a subsidiary’s voting power and value, the two file a consolidated federal return and losses in one business can offset profits in another.11Office of the Law Revision Counsel. 26 USC 1504 – Definitions On antitrust, conglomerate mergers between companies in entirely different industries generally face less resistance than horizontal mergers between direct competitors, though regulators still examine bundling and leverage concerns under the 2023 Merger Guidelines.12Federal Trade Commission. Merger Guidelines Neither force explains the current short list of diversified giants. The discount does.