Berkshire Hathaway ’s Plunge: Is This Your Next Big Win?

Berkshire Hathaway ’s latest stumble has left many investors biting their nails. Nevertheless, when we peel back the layers, we see a story of resilient earnings power, a towering cash pile and an attractive valuation that might just turn fear into opportunity. Let’s unpack the drama step by step.

Berkshire Hathaway Price Crash: What Just Happened?

Although Berkshire Hathaway spent the first four months of 2025 sprinting higher, the record close of 542.07 USD on 2 May quickly gave way to a 12.8 percent retreat toward 472.84 USD. Therefore, the market mood flipped from euphoria to anxiety in less than 90 days.

Berkshire Hathaway price trend since Jan 2024

Earnings Shock and Kraft Heinz Pain

First, operating earnings slipped 4 percent year-on-year to 11.16 billion USD as underwriting profits softened. Meanwhile, Berkshire Hathaway marked down its Kraft Heinz stake, swallowing a 3.8 billion USD impairment that slashed net income by 59 percent. Consequently, investors began to question the conglomerate’s defensive aura.

Tariffs, Retirement News and Market Jitters

Second, Berkshire Hathaway warned that spiralling trade tariffs could hit multiple subsidiaries, from railroads to retailers. At the same time, Warren Buffett’s surprise decision to step back as CEO by year-end added emotional fuel to the sell-off. Because the “Oracle” remains the brand’s beating heart, the leadership switch, however smooth, rattled nerves.

Digging Into Berkshire Hathaway Fundamentals

Revenue Still Climbing, Profits Holding Ground

Surprisingly, the top line continues to advance. Revenue rose from 302 billion USD in 2022 to 371 billion USD in 2024, while net income rebounded sharply after that one-off 2022 accounting loss. Thus, operational momentum remains intact even as headlines scream trouble.

Berkshire Hathaway revenue vs profit 2021-24

Cash Mountain and Conservative Leverage

Moreover, Berkshire Hathaway ended June with a record 344 billion USD in cash and equivalents. Consequently, the company enjoys unmatched fire-power to scoop up bargains or fund buybacks if shares drift lower. Importantly, long-term debt is modest relative to equity, keeping financial risk low.

Chart Analysis: Where Could Berkshire Hathaway Stop Falling?

Support and Resistance Zones

Technically speaking, the stock is now testing strong horizontal support around 470 USD, which coincides with the 200-day moving average. If that floor holds, a quick bounce toward 500 USD resistance is plausible. Conversely, a break could open the door to 450 USD.

Momentum and Volume Clues

Furthermore, relative strength has slipped below 50, signalling fatigue; yet, volume on down-days remains muted. Hence, capitulation selling has not appeared, suggesting that patient buyers may soon overpower nervous sellers.

Is Berkshire Hathaway a Buy After the Dip?

Valuation Check

Even after decades of compounding, Berkshire Hathaway trades at roughly 22 times normalised earnings and 1.6 times book value. Historically, those multiples map to double-digit five-year returns when purchased during mild corrections. Besides, today’s 30 percent year-to-date gain merely recovers last year’s rally, so the price is hardly euphoric.

My Personal Take

As an investor who loves simple businesses that print cash, I see the latest fall as a classic “Berkshire Hathaway moment.” Because the core engines—insurance float, BNSF Railway, and Berkshire Hathaway Energy—keep throwing off predictable cash, and because Buffett’s culture of prudence outlives any individual, I am accumulating shares in small, steady bites. Still, I will watch that 470 USD level like a hawk.

Conclusion: Turn Fear into a Framework

To sum up, Berkshire Hathaway’s share price slipped for four intertwined reasons: softer underwriting earnings, a Kraft Heinz writedown, tariff-related uncertainty and leadership transition jitters. Nevertheless, revenue keeps growing, cash reserves set fresh records, and the valuation looks undemanding. Therefore, while headlines scream “crash,” disciplined investors may read “chance.”

You Might also find this post insightful – https://bosslevelfinance.com/ilpt-stock-hidden-gem-or-value-trap-complete-analysis

Disclaimer: This analysis is for informational purposes only and does not constitute investment advice. We do not encourage users to buy, sell, or hold any securities. Stock markets are subject to change and past performance does not guarantee future results. Always conduct your own due diligence and consult with qualified financial advisors before making investment decisions.

Sources: