By at least one measure of valuation, the company run by Warren Buffett, Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B), is about as cheap as it's ever been. Shares in the insurance and industrial conglomerate are trading at roughly 1.2 times book value, the principal ratio used by investors and analysts to value a company like Berkshire. As the following chart illustrates, this is well below its long-run average of 1.6 times book.

Investors and analysts cite a variety of reasons for the decline. Some say it's related to uncertainty about the company's succession plan. While the 81-year-old Buffett hasn't announced the intent to step down from his position leading the company, investors are nevertheless skeptical about whether a successor could replicate Buffett's legendary performance. Others believe Berkshire's ever-increasing size has a concomitant effect on future growth. And I've also heard that it's simply because insurance premiums, the company's bread and butter, have been comparatively soft of late.

Whatever the reason, I can't help but wonder whether the market has taken the stock down too far. When Buffett releases his highly anticipated shareholder letter this Saturday, it's expected he'll emphasize how Berkshire's book value increased faster than the stock market last year. Yet over the same period, the company's shares returned a negative 3.5% compared to a positive 2.46% return for the S&P 500 (NYSE: SPY). Not to mention, Buffett has erected a firewall at 1.1 times book value, saying that Berkshire will buy back shares if it falls below that point. As a result, shareholders are effectively hedged on the downside at no expense of their own.

At the end of the day, it's hard to argue with the proposition that Berkshire's stock is extremely cheap from a historical point of view. If you like the idea of investing in Warren Buffett, but find Berkshire's Class A share price out of your range, then you may be interested in a smaller financial company that our analysts at The Motley Fool identified in a recent free report. The report discloses a handful of companies that only the smartest investors are buying, including one that they believe the legendary investor would have bought in his younger years. To access this report while it's still available, click here now -- it's free.