What’s Next for Berkshire Hathaway Stock
We first wrote about Berkshire Hathaway stock and Warren Buffett back in May 2024. Our thesis at the time was pretty straightforward: Mr. Buffett’s investment record is nothing short of legendary – one that may not be matched for generations, if ever. However, given the way Berkshire Hathaway is structured today, the portfolio Mr. Buffett oversees isn’t really built to beat the market anymore. It’s designed to serve the company’s unique needs — and that’s a very different thing.
Fast forward to now: Mr. Buffett has officially announced he’ll be stepping down from Berkshire Hathaway by the end of the year. That makes it the perfect time to revisit the company and ask – what’s next for Berkshire Hathaway stock?
Analyst Ratings: Lukewarm at Best
Let’s start with analyst ratings, via data from Seeking Alpha.
The first surprising thing? BRK isn’t followed by that many stock analysts at all. And the second? Even though the company is generally liked, it’s definitely not loved. Out of the four analysts who’ve issued updates in the past 90 days, the average rating lands somewhere between Hold and Buy – with even one lonely Sell recommendation in the mix.
Valuation: Fully Priced In
Now let’s take a look at price targets over the past five years, again courtesy of Seeking Alpha.
As you can see, analysts’ price targets tend to track the actual stock price pretty closely. Right now, Berkshire Hathaway stock is trading just 2% below its average target — which is a polite way of saying it’s fully valued. For comparison, NVDA is trading at a 45% discount to target, and GOOG at a 30% discount. So no, BRK is not cheap.
Earnings Outlook: Underwhelming Growth Ahead
Next up: earnings estimates for the next few years — and this part is concerning.
The S&P 500 has an expected earnings growth rate of over 12% annually over the next 3–5 years. BRK? Less than 5% on average. The reason is obvious: the portfolio is conservative, and the company is sitting on a ton of cash. According to CNBC, the total market value of Berkshire Hathaway’s stock portfolio is about $1.1 trillion, with an additional $347 billion in cash — that’s 23% of total capital. In bull markets, that cash is a drag.
Who Owns Berkshire Hathaway Stock? Institutions Remain Cautious
Ownership numbers tell a similar story. According to Finviz, retail ownership stands at 28% — about average. But because insider ownership is significant, that suggests institutional ownership is below average. And institutions don’t like cash-heavy, opaque holding companies. They prefer businesses that deploy capital aggressively. BRK doesn’t do that. It plays defense. That’s great in a crisis — not so great for beating the S&P in the long run.
Short Interest in Berkshire Hathaway Shares Remains Near Zero
Now, to short float. Also per Finviz, BRK’s short float sits at around 1%. That’s extremely conservative — nobody is betting against this stock. So while we don’t expect Berkshire Hathaway stock to collapse, we don’t expect it to shine either. It looks set to underperform the broader market, not tank.
Conclusion: Berkshire Hathaway Stock Isn’t Where the Action Is in 2025
Mr. Buffett deserves the retirement party of the century at the next Berkshire Hathaway shareholder meeting. The man has broken records that will stand for decades. But when it comes to investing in Berkshire Hathaway stock, count us on the sidelines.
Yes, it’s possible his successor, Greg Abel, could reshape the company in ways that bring back outperformance. But at today’s valuation, especially compared to the broader markets like the S&P 500 or Nasdaq 100 – BRK just doesn’t look attractive.
If you’re looking for stronger upside, we suggest checking out our latest piece on the Top S&P 500 Sectors to Invest in for 2025 — there’s more potential elsewhere.