Berkshire Hathaway’s Class B shares closed at $539.82 on October 20, 2026, two cents above the record they had set 17 months earlier, on May 2, 2025 — the Friday before Warren Buffett told Berkshire’s annual meeting he would hand over the chief executive job, as CNBC’s Warren Buffett Watch newsletter reported. The Class A shares matched the feat, closing above their own $809,350 high from that same Friday. The round trip, as 24/7 Wall St. calculated it, took 17 months, during which the S&P 500 gained more than 35%. Berkshire’s recovery erased its entire post-Buffett discount; it did not close any gap with the rest of the market.
The drop that followed Buffett’s announcement had two causes stacked on top of each other. The succession news broke on Saturday, May 3, 2025; the same day, Berkshire disclosed that first-quarter operating earnings — the profit from its wholly owned insurance, rail and utility businesses, stripped of swings in the value of its stock portfolio — had fallen 14% to $9.64 billion, dragged down by a 48.6% drop in insurance-underwriting profit to $1.34 billion after the Southern California wildfires cost that unit $1.1 billion, according to CNBC’s earnings report from that day. On the next trading day, Monday May 5, BRK.A fell 4.9% and BRK.B fell 5.1%. UBS analyst Brian Meredith argued at the time that Buffett was leaving behind “a company that is less reliant on his investing capabilities, with an array of leading businesses with strong cash flows.”
The market did not immediately agree with Meredith. Within three months the A shares were down 14.3% from their May high and the B shares almost 15%, their lowest closes of the year, as investors priced out what traders had started calling the “Buffett premium” — the extra multiple paid for having Buffett himself allocate the capital.
Berkshire then spent the rest of 2025 drifting rather than recovering: the stock slipped another 1.9% over the remaining months of the year while the S&P 500 rose 21%, a gap that had nothing to do with the operating businesses’ results and everything to do with who shareholders trusted to deploy Berkshire’s cash.
A second handoff, then a rally
The transfer of power came in two stages. Greg Abel took over as chief executive on January 1, 2026. Then, on September 18, 2026, Warren Buffett, 96, stepped down as chairman too, becoming chairman emeritus while remaining a director; the board elected his son Howard Buffett, who has sat on it since 1993, as non-executive chairman. “Greg runs the company; Howard will guard its culture and values,” Buffett wrote in the letter announcing the move, as CNBC reported.
Father Time always wins. He has, however, been generous with me. He has given me the opportunity to see Berkshire reach a point where I am more confident than ever about what lies ahead.
| From | To | How |
|---|---|---|
| Warren Buffett (CEO and chairman, 1965–2025) | Greg Abel (CEO since Jan 1, 2026) | CEO role |
| Warren Buffett (CEO and chairman, 1965–2025) | Howard Buffett (Non-executive chairman since Sept 18, 2026) | chairman role |
| Warren Buffett (CEO and chairman, 1965–2025) | Warren Buffett (Chairman emeritus, remains a director) | new title |
Based on Berkshire Hathaway
The chairman announcement produced a brief replay of May 2025: the stock’s low point came roughly two weeks later, in early October, before reversing. What turned it was arithmetic, not sentiment. Berkshire’s second-quarter operating profit, reported in the weeks after, rose 16% to $12.98 billion, a quarter KBW analyst Meyer Shields called “very solid,” per 24/7 Wall St. Abel also put Berkshire’s cash to work: after it peaked near $397 billion at the end of the first quarter, up from $373 billion at the end of 2025, according to CNN’s earnings coverage, Berkshire’s cash and equivalents fell 8.0% to $365.5 billion by June 30. Abel used the difference to buy back $4.5 billion of stock and invest $23.5 billion in equities, including $10 billion added to Berkshire’s stake in Alphabet, ending 14 consecutive quarters in which Berkshire had been a net seller of stocks.
That reassurance landed just as investors elsewhere were rotating out of AI infrastructure stocks. The semiconductor ETF SOXX fell 15.17% over the 11 trading sessions from October 6 to October 20, declining on 10 of them, while Berkshire rose on nine of those same sessions — its first 10-day winning streak since 2018 — before BRK.B finally closed above its old high on October 20.
Anti-AI, mostly
Barron’s called the stock “the ultimate anti-AI play” this week, citing Berkshire’s more than $350 billion in cash and equivalents and roughly $50 billion of annual after-tax earnings from a diverse group of businesses, and concluding that “Berkshire arguably is the most defensive megacap stock in the market,” as quoted in CNBC’s newsletter. The label needs qualifying. Berkshire is not short AI; it is diversified around it. Abel has said supplying power to the growing fleet of AI data centers is “a significant opportunity for Berkshire and Berkshire Hathaway Energy,” so long as rates do not rise for the utility’s other customers, and the firm’s $34 billion stake in Alphabet makes it a direct shareholder in one of the industry’s largest capital spenders. What Berkshire lacks is leverage to the trade: no chip fab, no hyperscaler capex line, no revenue tied to GPU utilization.
At Friday’s close Berkshire’s market capitalization stood at roughly $1.16 trillion, with BRK.A at $813,595 and BRK.B at $542.19. CNBC’s own tracker puts the trailing price-to-earnings ratio, on a GAAP net-income basis, at 13.6; 24/7 Wall St., calculating off trailing operating earnings instead, gets 11. The gap is the swing in unrealized gains on Berkshire’s stock portfolio that flows through GAAP net income but that Buffett always argued investors should ignore. Price-to-book, where that accounting noise matters less, stood at 1.06 on October 20, barely above levels at which Berkshire has in the past bought back its own stock.
Adam Patti of VistaShares, whose ETF tracks Berkshire’s disclosed holdings, told CNBC’s “Morning Call” this week that “the market spent a year pricing Berkshire without Buffett. I think it’s finally decided Abel can, in fact, run it,” calling Berkshire “a coiled spring” that “comes back fast and furious” once it turns. What unwinds the coil is the open question: the money that left semiconductor stocks for Berkshire over the past three weeks can leave just as fast if AI earnings beat expectations this quarter. Berkshire’s own next data point, third-quarter operating earnings, will be measured against the $13.48 billion it posted a year earlier.