Investment giant Berkshire Hathaway Inc. (NYSE:BRK.B) was in the news last week after its founder, the legendary Warren Buffett, announced that he was stepping down as the firm’s chairman. Buffett’s son, Howard Buffett, will replace him as Berkshire Hathaway Inc. (NYSE:BRK.B)’s chairman. Cramer discussed the news in his morning appearance on the 18th and praised the firm’s succession plan:
“Pretty darn great. Congratulations to him. And I think that, if you don’t understand the way he thinks after working there all these years, then I just think that you oughta have those people in [inaudible] telling you what to do. Because David, don’t you think, he’s got a legacy that, How many people, how many people, how many people have created a succession plan that’s as great as his?. . .I can’t find any company that has such a definitive succession plan.”
While Berkshire Hathaway Inc. continues to hold the media’s and public’s attention due to Buffett’s success as an investor, the shares have remained lackluster in 2026. They are up by roughly 1% year-to-date and have lost 3% since mid-September. 2026 is the first year Berkshire Hathaway Inc. is operating under its new CEO, Greg Abel.
Abel’s investment strategies have differed so far from Buffet’s, as he has invested more tha $20 billion in stock purchases, out of which $17 billion went in Google parent Alphabet alone. Naturally, Buffett is known for his caution and patience and the latest stock buys come when the market continues to intensely debate the intensity of hyperscaler AI capital expenditure and weigh it against profitability. The ability of the new management to match the outgoing chairman when it comes to success has got everyone talking.
Financially, Berkshire Hathaway Inc. posted modest growth in the second quarter, as during the period, the firm’s revenue and operating earnings grew by 10% and 16.3%. Additionally, the firm’s insurance float, which is one of the most distinctive factors of its business model and has helped its meteoric growth, sat at $177.5 billion, which provides Berkshire Hathaway Inc. with hefty capital. Not to mention, the firm’s cash pile was $365 billion to provide it with not only a stable source of income exposed to interest rates but also hefty resources to tap into for quick investment decisions.
On the valuation front, Berkshire Hathaway Inc.’s forward P/E ratio is 22.88, which is substantially higher than insurance peer Progressive Corp. Looking at hedge fund sentiment, 135 funds had disclosed a stake in the firm in Q2, which marked a jump over Q1’s 126. Notable increases include D E Shaw growing the stake by 311% to $961 million and Yacktman Asset Management by 269% to $581.
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