UBS Lowers Price Target on Berkshire Hathaway Stock (BRK.B) as ‘Buffett Premium’ Ends

One of the last remaining bulls on Berkshire Hathaway (BRK.B) stock has turned bearish, saying that the “Buffett premium” the shares have enjoyed is now over with CEO Warren Buffett stepping down.

Brian Meredith, a top five-star rated analyst with an 80% success rate at UBS (UBS), has cut his 2025 earnings estimate for Berkshire Hathaway by 6% to $19.92 per Class B share, mainly because he sees lower investment income being generated by the company. He also anticipates lower dividend income as Berkshire Hathaway has scaled back its equity portfolio over the past year.

Additionally, Meredith says that yields on Berkshire’s enormous $347 billion cash pile are likely to decline as the U.S. Federal Reserve is expected to cut interest rates later this year. However, the biggest reason Meredith says he has turned bearish on BRK.B stock is that the premium the shares have enjoyed is now over as Buffett prepares to hand the CEO role to successor Greg Abel at year’s end.

Lowered Price Target

Meredith said he also doesn’t expect any share buybacks from Berkshire Hathaway this year or in 2026 as the share price is currently trading above his estimate of its intrinsic value. Berkshire didn’t buy back any stock from May 2024 through late April, based on the company’s regulatory filings.

For all these reasons, Meredith, who has long been bullish on Berkshire Hathaway, cut his price target on the more affordable Class B shares to $591 from $606 previously. He did, however, maintain a Buy rating on the stock.

In a note to clients, the analyst wrote, “We continue to believe BRK’s shares are attractive in an uncertain macro environment with $347 billion of cash & short-term investments, a defensive business mix, and manageable tariff exposure.” BRK.B stock has risen 9% this year.

Is BRK.B Stock a Buy?

Berkshire Hathaway’s Class B stock has a consensus Moderate Buy rating among three Wall Street analysts. That rating is based on two Buy and one Hold recommendations assigned in the last three months. The average BRK.B price target of $536.50 implies 8.85% upside from current levels.

Read more analyst ratings on BRK.B stock