Berkshire Hathaway’s (BRK.B) Stock Falls After Earnings Fail to Impress

The stock of Berkshire Hathaway (BRK.B) is down 3% after the company reported second-quarter financial results that failed to impress Wall Street.

The holding company run by Warren Buffett reported Q2 earnings over the weekend that underwhelmed analysts and investors, sending the share price lower in early trading on Aug. 4. Omaha-based Berkshire announced operating earnings, including those from its insurance and railroad businesses, that were down 4% from a year earlier at $11.16 billion.

A decrease in insurance underwriting dragged down the company’s overall results. At the same time, Berkshire Hathaway recorded a big write-down in its Kraft Heinz (KHC) stake. Specifically, Berkshire posted a loss of $3.8 billion from its 27% ownership position in Kraft Heinz. The consumer goods giant has been eyeing a spinoff of its grocery business.

No Stock Buybacks

At the same time, analysts are speculating that investors are disappointed with the fact that Buffett did not buyback any Berkshire Hathaway stock during this year’s second quarter even as the conglomerate sits on a near-record cash pile of $344.1 billion. Berkshire was a net seller of stocks for an11th consecutive quarter during Q2 and offloaded $4.5 billion of equities in the first half of this year.

The post-earnings selloff in BRK.B stock continues a downward trend that began after Buffett announced in May of this year that he planned to step down as Berkshire’s CEO at the end of 2025, though he will remain chairman of the board. The stock has now fallen 12% from an all-time high reached in early May.

Is BRK.B Stock a Buy?

Only one analyst currently offers a rating and price target on Berkshire Hathaway’s more affordable Class B stock. So instead, we’ll look at the three-month performance. As one can see in the chart below, shares of BRK.B have declined 8% in the last 12 weeks.