Berkshire Hathaway Shares Are Up 11% This Year. Is the Stock a Buy Ahead of Earnings?

Berkshire Hathaway is set to release its third-quarter 2026 earnings report on Nov. 7. Here’s Morningstar’s take on what to look for in Berkshire Hathaway’s earnings and the outlook for its stock.

Key Morningstar Metrics for Berkshire Hathaway

• Fair Value Estimate
  : $510.00
• Morningstar Rating
  : ★★
• Morningstar Economic Moat Rating
  : Narrow
• Morningstar Uncertainty Rating
  : Low

Berkshire Hathaway Earnings Release Date

• Saturday, Nov. 7, 2026

What to Watch for in Berkshire Hathaway’s Q3 Earnings

• We expect third-quarter operating earnings to increase by mid-to-high single digits year over year, despite weaker underwriting results from Berkshire’s insurance operations, with the major non-insurance businesses offsetting pricing and growth pressures in the insurance industry.
• Much like the rest of the industry, Berkshire’s insurance business is facing margin normalization and heightened competition as pricing has come down from record highs since covid. We expect weaker earned premium growth at Geico and Berkshire Hathaway Reinsurance Group, but profitability should remain strong at the latter given the lack of major catastrophes.
• Non-insurance businesses should offer brighter news. At BNSF Railway, while rising fuel costs will have driven both revenue and expenses higher during the quarter, we expect decent volume growth. The third quarter tends to be the strongest for the energy/utilities operations in any given year, and with these businesses seeing favorable demand trends and benefiting from operating leverage across the utility portfolio, we expect this quarter to be no different.
• We view Berkshire’s shares, trading at close to a 10% premium relative to our $765,000 ($510) per Class A (B) share fair value estimate, as moderately overvalued. The stock has historically been a haven in more volatile markets (especially now with more than $320 billion in uncommitted cash on hand at the end of the second quarter of 2026), and it has run up more than 10% in the past month.

The following are excerpts from Morningstar’s company report on Berkshire Hathaway.

Fair Value Estimate for Berkshire Hathaway

With its 2-star rating, we believe Berkshire Hathaway’s stock is moderately overvalued compared with our long-term fair value estimate of $510 per Class B share, which is equivalent to 1.45 and 1.35 times our estimates for Berkshire’s book value per share, respectively, at the end of 2026 and 2027. For some perspective, during the past five (10) years, the shares have traded at an average of 1.51 (1.45) times trailing calendar year-end book value per share. We use a 9% cost of equity in our valuation and assume that Berkshire, at the very least, pays the 15% corporate alternative minimum tax on adjusted financial statement income.

Read more about Berkshire Hathaway’s fair value estimate.

Economic Moat Rating

Berkshire’s insurance operations—Geico, Berkshire Hathaway Reinsurance Group, and Berkshire Hathaway Primary Group—remain important contributors to the overall business. That said, we don’t believe the insurance industry is particularly conducive to the development of maintainable competitive advantages.

Believing Class I operators like Berkshire’s BNSF Railway will continue to leverage their competitive advantages of low cost and efficient scale to generate returns on invested capital in excess of the firm’s cost of capital, we have awarded them wide moat ratings.

We think Berkshire Hathaway Energy has a narrow moat. We do not believe regulated utilities can establish more than a narrow economic moat, because their rates and returns are set by state and federal regulators.

As for Berkshire’s manufacturing, service, and retailing operations, given Berkshire’s penchant for acquiring companies with consistent earnings power, generating above-average returns on capital, holding little debt, and run by solid management teams, we believe many of the businesses in the segment have narrow moats.

Read more about Berkshire Hathaway’s economic moat.

Financial Strength

Berkshire’s strong balance sheet and liquidity are among its most enduring competitive advantages. The company’s insurance operations are overcapitalized, carrying greater levels of equity, fixed income, and cash relative to its required loss reserves. Berkshire generates large amounts of free cash flow and maintains significant amounts of cash and equivalents on its balance sheet, amounting to $364.7 billion at the end of June 2026.

Read more about Berkshire Hathaway’s financial strength.

Risk and Uncertainty

Our Uncertainty Rating for Berkshire is Low. We do not consider any of the firm’s environmental, social, or governance issues material enough to affect our rating.

Berkshire faces the risk that insurance claims exceed loss reserves or that material impairments affect its investment portfolio. Several of the firm’s key businesses operate in industries subject to higher degrees of regulatory oversight, which could affect future business combinations, as well as the setting of rates charged to customers. Many of the company’s noninsurance operations are exposed to the cyclicality of the US economy, with results suffering during economic slowdowns. Berkshire is also exposed to foreign currency, equity prices, and credit default risk through its various investments and operating companies.

Read more about Berkshire Hathaway’s risk and uncertainty.

BRK.B Bulls Say

• Book value per share, which is a good proxy for measuring changes in Berkshire’s intrinsic value, increased at an estimated 18.1% CAGR during 1965-2025, compared with a 10.5% annualized return for the S&P 500 TR index.
• Berkshire’s stock performance has generally been solid, increasing at a 16.8% (14.3%) CAGR during 2021-25 (2016-25), compared with a 14.4% (14.8%) average annual return for the S&P 500 TR index.
• At the end of June 2026, Berkshire had $177.5 billion in insurance float. The cost of the firm’s float has generally been negative during much of the past two decades.

BRK.B Bears Say

• Given its size, Berkshire’s biggest hurdle is consistently finding deals that both add value and are large enough to be meaningful.
• The firm now faces life after the departure of Warren Buffett, who resigned as executive chair in September 2026.
• We believe CEO Greg Abel will be held to a different standard than Buffett ever was, primarily because he will serve as both an operator (which never interested Buffett much) and an investor (something Abel has little experience in).

This article was compiled by Colin Laidley.