Berkshire's stock has suffered in a post-Buffett world. Why that's actually a good thing.

MW Berkshire's stock has suffered in a post-Buffett world. Why that's actually a good thing.

By Tomi Kilgore

New CEO Greg Abel has the biggest investment shoes to fill - but he also had the best coach, which gives him 'the best chance of success'

Berkshire Hathaway's stock has underperformed by a wide margin leading up to the company's annual general meeting - but a noted Warren Buffett watcher said investors should be happy to be able to buy the stock cheaper.

Berkshire Hathaway shareholders likely have a lot of questions for new management this weekend when the company holds its annual general meeting. But the biggest may very well be: "Why has the stock underperformed so much this year, and what will be done about it?"

Since the end of 2025 - when new CEO Greg Abel took the reins from the retired Warren Buffett, who is viewed by many as the greatest value investor of all time - Berkshire shares $(BRK.B)$ have shed 5.8%. That's their worst start to a year since 2020, at the height of the COVID-19 panic. If you exclude the COVID selloff, then it's the worst four-month start to a year since 2015.

By comparison, the S&P 500 SPX has gained 5.3% in 2026.

The company did say in February, when Berkshire released its first earnings report with Abel in charge, that its insurance business had been struggling, to the point that it would not be looking to grow the business for a while.

Another key concern for investors is whether Berkshire can right the ship under Abel, after they got so used to trusting Buffett with their money. How can Berkshire keep up with the market, much less catch up, when it doesn't own any of the S&P 500's top 25 performers this year? And that reluctance to buy into the hype surrounding artificial intelligence comes at a time when Berkshire has grown its cash pile to record levels.

But Mike O'Rourke, chief market strategist at JonesTrading and a noted Buffett watcher, said he's not worried. Although he acknowledged that Abel has "the biggest investment shoes to fill in the world," he also had the best coach, and he had a lot of time to learn from him. Abel joined Berkshire after the company's 1999 investment in MidAmerican Energy, where Abel was president.

"There's not a person in the world that has had that type of three-decade apprenticeship with someone of that stature," O'Rourke told MarketWatch. "Greg Abel has the best chance of success, and I believe he will be successful."

So rather than worry about the weakness in Berkshire's stock, investors should just let it happen - and be thankful. That's because, in true Buffett fashion (he was known for buying into high-value names others were running away from), the selloff makes the stock cheaper to buy.

Berkshire's first-quarter earnings report is expected to be released Saturday at 8 a.m. Eastern time. The annual general meeting is slated to kick off at 9:15 a.m.

O'Rourke said worries over Berkshire's strategy of avoiding hot AI plays reminds him of 1999, when Buffett chose to avoid the internet hype that led to the dot-com bubble. Berkshire's stock dropped 22.1% in 1999, while the S&P 500 soared 19.5%.

Yet Buffett proved prescient: The dot-com bubble popped, and Berkshire's stock soared 28.6% in 2000 and 60.4% over the next five years - while the S&P 500 lost 10.1% in 2000 and shed 17.5% over the next five years.

And, O'Rourke noted, Berkshire has been putting some of its cash hoard to work, the way Buffett would. Abel said in an interview on CNBC in March - just after Berkshire's stock took a hit with the start of the Iran conflict - that for the first time in nearly two years, the company had "recommenced" buying back it's own stock.

Read: Berkshire Hathaway's new CEO makes a one-time only announcement: We're buying back stock.

The company was always willing to repurchase shares, but only at the right price, Abel said. So with the recent underperformance, the estimate of the company's "intrinsic value" crossed below a certain undisclosed threshold, triggering a buy signal. Not only was that threshold defined under Buffett's watch, but the "Oracle of Omaha" himself was consulted before the recent repurchases were made.

Questions that shareholders may have for Berkshire management this weekend could include whether the company has continued to repurchase its shares as prices have fallen; and whether there are any other stocks or companies that Berkshire and Abel are eyeing as an investment.

But one question investors shouldn't have is whether they can trust Abel and the new Berkshire, O'Rourke said. The company's investment model, borne from Buffett's six decades in the business, is "a model everyone should follow," he noted.

"In the long run, investors are going to be happy," O'Rourke said.

-Tomi Kilgore

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May 01, 2026 07:00 ET (11:00 GMT)

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