2 Reasons to Buy Berkshire Hathaway Stock Now

For things have changed significantly Berkshire Hathaway (NYSE: BRKA ) (NYSE: BRKB) In the last five years. One of the company’s architects, Charlie Munger, died in 2021. And last year, its longtime CEO and legendary investor, Warren Buffett, said he was stepping down as the company’s chairman. Given these changes, many investors are skeptical about Berkshire Hathaway’s future. However, there are still good reasons to buy the stock. Let’s consider two of them.

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What has made Berkshire Hathaway so successful over the past few decades? Buffett’s and Munger’s leadership is undoubtedly an important part of this. They ran the company, acquired new subsidiaries, and invested in the stock according to a set of principles and culture that they developed throughout the business.

It will be difficult for anyone to fill the shoes of Buffett and Munger, but the company’s new CEO Greg Abel is determined to run Berkshire Hathaway along the same lines, something he has clearly communicated to observers inside and outside the company.

As Abel said in his last letter to shareholders as the company’s CEO, “Last month I sent a letter to my employees to emphasize that Berkshire’s culture and values ​​are not changing and will always remain so.”

Abel shared the letter with Berkshire Hathaway Partners. Now, the good news is that Abel should emulate Buffett and Munger exactly. However, when the latter first started, they had nothing like Berkshire Hathaway in its current iteration to work with. Abel inherits a strong, cash-rich company with a remarkably diverse pool of subsidiaries, many outstanding leaders, and a culture and heritage of excellence. It is not created from scratch.

Not that it will be easy to lead Berkshire Hathaway from here, but in my opinion it will be very difficult to start over. Given Abel’s long tenure with the company, his track record as he oversaw the company’s non-insurance operations, the fact that he was handpicked by Buffett himself, and his desire to maintain the business’ foundation and culture, Berkshire Hathaway’s future still looks bright.

Buffett announced his retirement on May 3, 2025 during the company’s annual shareholder meeting. The stock fell sharply after the announcement, and although it has recovered slightly, it is still down nearly 10% since then. Meanwhile, d S&P 500 There is a strong increase of 20% during the same period.

BRK.B data by YCharts

Berkshire Hathaway’s poor share performance over the past 10 months no doubt reflects the fact that some investors no longer want anything to do with a company that is not led by Buffett. For those who have faith — and it’s not blind faith, as we’ve seen — in Abel’s ability to successfully lead the company, this represents a great opportunity to buy Berkshire Hathaway shares at the plunge.

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Prosper Junior Bikini has positions at Berkshire Hathaway. The Motley Fool owns and recommends positions in Berkshire Hathaway. Motley Fool has a disclosure policy.

2 Reasons to Buy Berkshire Hathaway Stock Now was originally published by The Motley Fool