Hold BRK-B with disciplined scaled entry framework; structural support intact but tactical momentum broken at $500-510
The HOLD rating is maintained with a disciplined scaled entry framework that resolves the structural-versus-tactical tension. The 8/24 prior decision lesson is dispositive: trimming 30% on the same signal stack (confirmed MACD bearish cross, expanding negative histogram, contracting bounce volume, ATR expansion) produced pure alpha drag against a flat-to-up tape because structural trend integrity (price > 50 SMA > 200 SMA, all rising) remained intact. The correct posture then — and now — was Hold with disciplined sizing, not active trimming. The 2% portfolio cap discipline was right; the 30% trim was wrong. That lesson prevents an Underweight here despite the same tactical signal alignment. The 8/18 lesson (downgrade toward Underweight when conservative/aggressive tactical signals align against you) is partially applicable but the buyback resumption, defensive rotation validation, and rising 200 SMA distinguish this from that setup — the long-term bull signals have NOT broken. The 8/19 lesson (alpha edge comes from disciplined patience on structural support) reinforces HOLD. The 8/20 lesson (staged accumulation with tighter invalidation beats symmetric patience in low-beta compounders) is incorporated via the Neutral analyst's scaled entry triggers rather than a static $470-485 target. Hard invalidation on close below $492 (200 SMA) on volume >4M.
| Position | Action |
|---|---|
| VWMA reclaim at $510 with MACD histogram contracting toward zero | Add one-third position |
| Pullback to $495-500 with positive MACD divergence | Add second third |
| Deeper pullback to $485 OR confirmed breakout above $529 | Add final third |
The post-rally pullback is a healthy reset, not a reversal; Berkshire's fortress balance sheet, resumed capital deployment, and structural uptrend make this a buying opportunity.
| Indicator | Value | Signal |
|---|---|---|
| 10 EMA | 503.63 | bullish |
| 50 SMA | 501.07 | bullish |
| 200 SMA | 492.28 | bullish |
| MACD Line | -0.14 | bearish |
| MACD Signal Line | 1.70 | neutral |
| MACD Histogram | -1.84 | bearish |
| RSI (Aug-25) | 50.12 | neutral |
| RSI (Aug-21 low) | 41.97 | neutral |
| RSI (Aug-10 peak) | 74.54 | bullish |
| Bollinger Upper Band | 528.62 | neutral |
This report is AI-generated for informational and educational purposes only and is not investment advice or a recommendation to buy or sell any security. Full disclaimer.
When: Pullback to $495-500 with positive MACD divergence
Then: Second third of position
Fortress balance sheet provides unmatched financial strength
↩ rebuts: “Bear frames shrinking cash as weakness; it's actually capital deployment signal”
· concedes: Top-heavy concentration in Apple, BAC, KO, AXP is a risk (though these are high-quality franchises); GAAP earnings do show significant volatility from mark-to-market swings: $23B loss (2022) → $96B (2023) → $67B (2025); Analyst expectations for earnings normalization create elevated forward P/E at 22.7x
BRK-B is overpriced at $500+ near 52-week highs with a 22.7x forward P/E, concentrated mega-cap tech exposure that provides no defensive ballast, GAAP earnings dominated by mark-to-market volatility rather than operating performance, and a CEO making unproven, philosophy-deviating bets—all creating negative asymmetry where downside risk exceeds upside potential.
· concedes: Forward earnings contraction may partially reflect cyclical rather than structural concerns; High-quality holdings provide some downside cushioning in corrections; The 6.36% pullback was relatively shallow and respected key technical levels; Past tangible book value compounding was achieved in favorable rate and equity market conditions
→ vs conservative: The 22.7x forward P/E is a mirage inflated by GAAP mark-to-market gains; trailing P/E of 12.67x and normalized 14-15x through-cycle earnings make this a discount, not stretched valuation
→ vs conservative: The 'near 52-week high' argument ignores structural trend with 50 SMA above 200 SMA, golden cross confirmed, and price holding above all major moving averages
→ vs conservative: Binary resolution framing underweights the asymmetric risk/reward with 2.5% downside versus $529+ upside target in a coiled spring setup
→ vs neutral: Wait-and-see approach at $470-485 fights against the most informed capital allocator—Buffett is buying via $4.2B Q2 2026 buyback and $37B Alphabet bet
| Bollinger Middle Band (20 SMA) |
| 509.74 |
| bearish |
| Bollinger Lower Band | 490.87 | bullish |
| ATR | 7.29 | neutral |
| VWMA | 510.02 | bearish |
| 50 SMA vs 200 SMA Spread | $8.79 | bullish |
Support: 503.63 · 501.07 · 495.82 · 492.28 · 490.87 | Resistance: 509.74 · 510.02 · 524.61 · 529.42
BRK-B is in a neutral/consolidation phase after a V-shaped rally-and-pullback pattern. The 50 SMA has crossed above the 200 SMA with widening spread, confirming the structural uptrend remains intact. Momentum has reset from overbought (RSI 74.54) to neutral (50.12), and MACD has crossed below its signal line for the first time since July, indicating weakening but not bearish momentum. ATR has contracted from 8.52 to 7.29, suggesting imminent volatility expansion. Volume on the decline was above-average initially but has now subsided to 3.03M shares, indicating selling exhaustion. The critical battleground zone is $500-$510; a decisive break above $510 (VWMA + Bollinger middle confluence) would signal bullish resumption toward $524-530, while a break below $495 would target the 200 SMA at $492. The report recommends HOLD with bullish bias pending confirmation.
Market Cap
$1,079.6 B
Current Price
~$500.4
P/E (TTM)
12.67
Forward P/E
22.72
PEG Ratio
10.06
EPS (TTM)
$39.79
Forward EPS
$22.19
Beta
0.607
52-Week High
$537.74
52-Week Low
$464.01
50-Day Avg
$500.76
200-Day Avg
$492.21
Book Value Per Share
~$522,226
Revenue 2025 (Annual)
$410,522 M
Revenue 2024 (Annual)
$424,232 M
Revenue 2023 (Annual)
$439,337 M
Revenue 2022 (Annual)
$234,121 M
Net Income 2025 (Annual)
$66,968 M
Net Income 2024 (Annual)
$88,995 M
Net Income 2023 (Annual)
$96,223 M
Net Income 2022 (Annual)
$(22,759 M)
Diluted EPS 2025
$31.04
Diluted EPS 2024
$41.27
Diluted EPS 2023
$44.27
Diluted EPS 2022
$(10.33)
EBITDA (TTM)
$130.7 B
Interest Income 2025
$23,261 M
Interest Expense 2025
$5,069 M
Revenue Q2 2026
$117,885 M
Net Income Q2 2026
$25,767 M
Diluted EPS Q2 2026
$11.91
Revenue Q1 2026
$92,070 M
Net Income Q1 2026
$10,179 M
Diluted EPS Q1 2026
$4.68
Total Assets Q2 2026
$1,263,071 M
Total Assets Dec-2025
$1,222,176 M
Cash & ST Investments Q2 2026
$365,514 M
Cash & Cash Equivalents Q2 2026
$40,609 M
Equity Investments Q2 2026
$323,779 M
Other Short-Term Investments Q2 2026
$324,905 M
Investments & Advances Q2 2026
$685,666 M
Stockholders Equity Q2 2026
$747,910 M
Tangible Book Value Q2 2026
$630,788 M
Long-Term Debt Q2 2026
$125,936 M
Current Debt Q2 2026
$2,663 M
Total Debt Q2 2026
$128,599 M
Debt/Equity
17.14%
Operating Cash Flow 2025
$45,969 M
Capital Expenditures 2025
$(20,927 M)
Free Cash Flow 2025
$25,042 M
Operating Cash Flow Q2 2026
$11,215 M
Free Cash Flow Q2 2026
$5,570 M
Share Repurchases Q2 2026
$4,209 M
Gross Profit (TTM)
$116.7 B
Operating Margin
32.6%
Profit Margin
22.3%
Return on Equity (ROE)
12.1%
Return on Assets (ROA)
6.0%
H1 2026 EPS
$16.60
H1 2025 EPS
$7.87
H1 2026 vs H1 2025 EPS Growth
+111%
Revenue YoY Growth Q2 2026
19.2%
Strengths
Concerns
Berkshire Hathaway (BRK-B) is a diversified conglomerate with operations spanning insurance (GEICO, Reinsurance, General Re), railroad (BNSF), energy (Berkshire Hathaway Energy), and manufacturing. The company reported Q2 2026 net income of $25.8B on revenue of $117.9B, with H1 2026 EPS of $16.60 more than doubling year-over-year. The fortress balance sheet holds $365.5B in cash and short-term investments against $128.6B in long-term debt, with tangible book value of $630.8B. The company resumed share repurchases ($4.2B in Q2 2026) after pausing, signaling management views shares as undervalued near current levels of ~$500. Key risks include mark-to-market earnings volatility, concentrated equity portfolio, and forward P/E of ~23x suggesting normalized earnings expectations. Most appropriate as a long-term core defensive holding; tactical entries better around the 200-day moving average (~$492) than at current levels near $500.
Macro: Fed on hold: Polymarket shows 86% probability of NO rate cuts in 2026 (up +1.2pp WoW), with 0% probability assigned to 6, 9, 10, 11, or 12+ cuts. US recession by end of 2026: 8% (+1.0pp WoW). Japan recession risk at 23% (-8pp WoW). AI/chip complex wobbled Aug 24 with rotation into defensives. Silver above $68/oz; copper stocks under active debate. FRED macro data unavailable (missing API key); analysis relies on prediction market probabilities and news flow.