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BRK.B moved above its 50- and 200-day SMAs on Dec. 22, signaling the start of an uptrend.
BRK.B's average analyst price target implies 7.6% upside, though the stock trades above industry P/B levels.
BRK.B's modest ROE, ROIC and falling earnings estimates temper optimism.
Shares of Berkshire Hathaway Inc. (BRK.B - Free Report) have gained momentum recently. The stock moved above its 50- as well as 200-day simple moving average (SMA) on Dec. 22, signaling a bullish trend.
The 50-day and 200-day SMAs are key indicators for traders and analysts to identify support and resistance levels. These are considered particularly important as they are the first markers of an uptrend or downtrend.
Image Source: Zacks Investment Research
Based on short-term price targets offered by four analysts, the Zacks average price target is $537.75 per share. The average suggests a potential 7.6% upside from the last closing price.
BRK.B shares have gained 10.4% year to date, outperforming the industry’s increase of 9.9%. Berkshire Hathaway is a conglomerate with more than 90 subsidiaries engaged in diverse business activities. This provides it stability in various economic cycles.
BRK.B’s peer, Chubb Limited (CB - Free Report) , has gained 13.4% year to date, while another peer, The Progressive Corporation (PGR - Free Report) , has lost 5.3% year to date.
Chubb, a premier global provider of property and casualty insurance and reinsurance, is targeting growth in the middle-market segment across domestic and international regions. Chubb is enhancing its core package solutions and expanding its specialty insurance portfolio. With focused strategic initiatives, Chubb seeks sustainable growth and stronger competitive positioning.
Progressive, one of the top auto insurers in the United States, is well-positioned to sustain profitability through its strong market presence, broad product offerings and disciplined underwriting. Progressive is advancing its strategy by promoting bundled auto insurance, limiting exposure to high-risk properties, and enhancing segmentation with targeted, innovative solutions. With this approach, Progressive continues to strengthen its competitive edge.
BRK.B Shares Are Expensive
The stock is overvalued compared with its industry. It is currently trading at a price-to-book multiple of 1.54, higher than the industry average of 1.51 but below the median of 1.57.
Image Source: Zacks Investment Research
Berkshire is relatively cheap compared to Progressive but expensive compared to Chubb.
The Case for BRK.B Stock
Berkshire Hathaway’s insurance operations form the core of its business model, accounting for about one-quarter of total revenues and serving as a major engine of long-term value creation. The segment’s strength lies in disciplined underwriting, broad market reach and an ability to remain profitable across economic cycles. A critical advantage is the impressive underwriting float it generates, which Warren Buffett has consistently used as a low-cost source of capital to fund investments across the company.
This insurance strength is complemented by Berkshire’s other major operating businesses. Berkshire Hathaway Energy (BHE), its regulated utility arm, delivers stable and predictable cash flows while continuing to expand investments in renewable energy. These initiatives align well with long-term global trends such as electrification, decarbonization and sustainability.
Within this segment, Burlington Northern Santa Fe (BNSF) plays a crucial strategic role as one of the largest freight rail networks in the United States. Although BNSF is currently facing challenges from an unfavorable freight mix and lower fuel surcharge revenues, it remains a high-quality, long-duration asset supported by essential freight demand and the ongoing importance of U.S. transportation infrastructure.
Berkshire’s Manufacturing, Service and Retail businesses add another layer of diversification and growth potential. This segment is more cyclical in nature and stands to benefit meaningfully from economic expansion and stronger consumer activity, which could drive higher sales volumes and margin improvement over time.
From a financial perspective, Berkshire maintains one of the most conservative capital allocation profiles among large corporations. The company holds more than $100 billion in cash and cash equivalents, with nearly 90% invested in short-term U.S. Treasuries and other government-backed securities. While elevated interest rates have recently enhanced investment income, expected Federal Reserve rate cuts should still preserve ample liquidity and provide flexibility. This conservative balance sheet allows Berkshire to act decisively on acquisition opportunities while maintaining steady income generation.
Berkshire has also been actively adjusting its equity portfolio. It has exited its position in BYD, reduced stakes in Apple and Bank of America, and expanded exposure to Japanese trading houses such as Mitsubishi and Mitsui. More recently, the company initiated an investment in Alphabet, reflecting confidence in durable, innovative businesses with strong cash flows. These portfolio shifts highlight a focus on stability, long-term value and capital returns through reinvestment and share repurchases.
Finally, Berkshire’s growing insurance float—rising from $114 billion in 2017 to $176 billion by the end of the third quarter of 2025—continues to supply low-cost capital, strengthening its balance sheet and reinforcing its ability to compound shareholder value over time.
Berkshire Hathaway’s Return on Capital
Return on equity (“ROE”) in the trailing 12 months was 7.3%, underperforming the industry average of 8%. Return on equity, a key profitability measure, reflects how effectively a company utilizes its shareholders’ funds. It is noteworthy that though BRK.B’s ROE lags the industry average, the metric has been improving consistently.
The same holds true for return on invested capital (ROIC), which has increased every year since 2020. This reflects BRK.B’s efficiency in utilizing funds to generate income. However, ROIC in the trailing 12 months was 5.7%, lower than the industry average of 6.2%.
Muted Analyst Sentiment
The Zacks Consensus Estimate for 2025 and 2026 revenues indicates a 3.5% and 6% year-over-year increase, respectively. However, the consensus estimate for 2025 and 2026 earnings implies a 5.2% and 3.9% year-over-year decrease, respectively.
Image Source: Zacks Investment Research
The consensus estimate for 2025 and 2026 earnings witnessed no movement in the last 30 days.
Parting Thoughts on BRK.B Shares
Berkshire Hathaway has been a cornerstone of investor portfolios for decades, generating steady shareholder value under Warren Buffett’s nearly 60-year leadership. The spotlight now shifts to the next chapter, with Greg Abel set to become CEO on Jan 1, 2026, while Buffett remains executive chairman.
Still, current factors warrant caution. With the stock trading at a premium, returns on capital appearing moderate, looming near-term earnings pressure and muted analyst sentiment, maintaining a wait-and-see stance appears sensible for this Zacks Rank #3 (Hold) stock.
Image: Shutterstock
BRK.B Stock Moves Above 50- & 200-Day SMA: Buy, Sell or Stay Invested?
Key Takeaways
Shares of Berkshire Hathaway Inc. (BRK.B - Free Report) have gained momentum recently. The stock moved above its 50- as well as 200-day simple moving average (SMA) on Dec. 22, signaling a bullish trend.
The 50-day and 200-day SMAs are key indicators for traders and analysts to identify support and resistance levels. These are considered particularly important as they are the first markers of an uptrend or downtrend.
Image Source: Zacks Investment Research
Based on short-term price targets offered by four analysts, the Zacks average price target is $537.75 per share. The average suggests a potential 7.6% upside from the last closing price.
BRK.B shares have gained 10.4% year to date, outperforming the industry’s increase of 9.9%. Berkshire Hathaway is a conglomerate with more than 90 subsidiaries engaged in diverse business activities. This provides it stability in various economic cycles.
BRK.B’s peer, Chubb Limited (CB - Free Report) , has gained 13.4% year to date, while another peer, The Progressive Corporation (PGR - Free Report) , has lost 5.3% year to date.
Chubb, a premier global provider of property and casualty insurance and reinsurance, is targeting growth in the middle-market segment across domestic and international regions. Chubb is enhancing its core package solutions and expanding its specialty insurance portfolio. With focused strategic initiatives, Chubb seeks sustainable growth and stronger competitive positioning.
Progressive, one of the top auto insurers in the United States, is well-positioned to sustain profitability through its strong market presence, broad product offerings and disciplined underwriting. Progressive is advancing its strategy by promoting bundled auto insurance, limiting exposure to high-risk properties, and enhancing segmentation with targeted, innovative solutions. With this approach, Progressive continues to strengthen its competitive edge.
BRK.B Shares Are Expensive
The stock is overvalued compared with its industry. It is currently trading at a price-to-book multiple of 1.54, higher than the industry average of 1.51 but below the median of 1.57.
Image Source: Zacks Investment Research
Berkshire is relatively cheap compared to Progressive but expensive compared to Chubb.
The Case for BRK.B Stock
Berkshire Hathaway’s insurance operations form the core of its business model, accounting for about one-quarter of total revenues and serving as a major engine of long-term value creation. The segment’s strength lies in disciplined underwriting, broad market reach and an ability to remain profitable across economic cycles. A critical advantage is the impressive underwriting float it generates, which Warren Buffett has consistently used as a low-cost source of capital to fund investments across the company.
This insurance strength is complemented by Berkshire’s other major operating businesses. Berkshire Hathaway Energy (BHE), its regulated utility arm, delivers stable and predictable cash flows while continuing to expand investments in renewable energy. These initiatives align well with long-term global trends such as electrification, decarbonization and sustainability.
Within this segment, Burlington Northern Santa Fe (BNSF) plays a crucial strategic role as one of the largest freight rail networks in the United States. Although BNSF is currently facing challenges from an unfavorable freight mix and lower fuel surcharge revenues, it remains a high-quality, long-duration asset supported by essential freight demand and the ongoing importance of U.S. transportation infrastructure.
Berkshire’s Manufacturing, Service and Retail businesses add another layer of diversification and growth potential. This segment is more cyclical in nature and stands to benefit meaningfully from economic expansion and stronger consumer activity, which could drive higher sales volumes and margin improvement over time.
From a financial perspective, Berkshire maintains one of the most conservative capital allocation profiles among large corporations. The company holds more than $100 billion in cash and cash equivalents, with nearly 90% invested in short-term U.S. Treasuries and other government-backed securities. While elevated interest rates have recently enhanced investment income, expected Federal Reserve rate cuts should still preserve ample liquidity and provide flexibility. This conservative balance sheet allows Berkshire to act decisively on acquisition opportunities while maintaining steady income generation.
Berkshire has also been actively adjusting its equity portfolio. It has exited its position in BYD, reduced stakes in Apple and Bank of America, and expanded exposure to Japanese trading houses such as Mitsubishi and Mitsui. More recently, the company initiated an investment in Alphabet, reflecting confidence in durable, innovative businesses with strong cash flows. These portfolio shifts highlight a focus on stability, long-term value and capital returns through reinvestment and share repurchases.
Finally, Berkshire’s growing insurance float—rising from $114 billion in 2017 to $176 billion by the end of the third quarter of 2025—continues to supply low-cost capital, strengthening its balance sheet and reinforcing its ability to compound shareholder value over time.
Berkshire Hathaway’s Return on Capital
Return on equity (“ROE”) in the trailing 12 months was 7.3%, underperforming the industry average of 8%. Return on equity, a key profitability measure, reflects how effectively a company utilizes its shareholders’ funds. It is noteworthy that though BRK.B’s ROE lags the industry average, the metric has been improving consistently.
The same holds true for return on invested capital (ROIC), which has increased every year since 2020. This reflects BRK.B’s efficiency in utilizing funds to generate income. However, ROIC in the trailing 12 months was 5.7%, lower than the industry average of 6.2%.
Muted Analyst Sentiment
The Zacks Consensus Estimate for 2025 and 2026 revenues indicates a 3.5% and 6% year-over-year increase, respectively. However, the consensus estimate for 2025 and 2026 earnings implies a 5.2% and 3.9% year-over-year decrease, respectively.
Image Source: Zacks Investment Research
The consensus estimate for 2025 and 2026 earnings witnessed no movement in the last 30 days.
Parting Thoughts on BRK.B Shares
Berkshire Hathaway has been a cornerstone of investor portfolios for decades, generating steady shareholder value under Warren Buffett’s nearly 60-year leadership. The spotlight now shifts to the next chapter, with Greg Abel set to become CEO on Jan 1, 2026, while Buffett remains executive chairman.
Still, current factors warrant caution. With the stock trading at a premium, returns on capital appearing moderate, looming near-term earnings pressure and muted analyst sentiment, maintaining a wait-and-see stance appears sensible for this Zacks Rank #3 (Hold) stock.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.