Warren Buffett is serving his final months as CEO of Berkshire Hathaway (BRK.A 0.17%) (BRK.B 0.13%). At the company's annual shareholder meeting in May, the billionaire investor announced he would step down by the end of 2025. So Berkshire's November earnings report will be his last as CEO.
Investor worry over Buffett's pending exit has the stock price down by more than 9% since the announcement. Yet the upcoming quarterly report should show Berkshire's diverse array of businesses continuing to deliver strong operating results. It also may include a supportive, optimistic departing message from Buffett. In the meantime, investors who are focused on the long term can take advantage of the stock's pullback to pick up discounted shares.
Warren Buffett. Image source: The Motley Fool.
Berkshire's latest shrewd acquisition
Berkshire's operations are doing quite well. Operating earnings rose by 27% to $47.4 billion in fiscal 2024. Operating profits declined by almost 9% year over year in the first six months of 2025. However, cash flow from operations remained strong, lifting Berkshire's hoard of cash and cash equivalents to nearly $345 billion as of the end of Q2.
In early October, the company announced it was putting some of that cash to work. Berkshire is acquiring Occidental's chemical business, OxyChem, in an all-cash transaction for $9.7 billion. The oil and natural gas company has been a favorite investment of Buffett's in recent years. After multiple rounds of stock purchases, Berkshire now owns nearly one-third of Occidental's outstanding shares.
The OxyChem deal shows what a shrewd investor Buffett can be. Berkshire's massive stake in Occidental should gain value as the energy company's financial position will be improved by the deal. Occidental plans to use much of that $9.7 billion to pay down debt. For Berkshire's part, it bought OxyChem for less than 10 times the asset's trailing-12-month pre-tax operating income. It could be a great addition to the portfolio of operating businesses the conglomerate has acquired at reasonable prices.
Berkshire has lagged the S&P 500
Positive results from the OxyChem purchase could help Berkshire shares make up some ground. The stock has lagged the S&P 500 index meaningfully this year. At recent prices, its returns are behind those of the index by the biggest margin so far in 2025.
NYSE: BRK.B
Key Data Points
That gives investors the chance to buy Berkshire at a price-to-book value that's approaching the stock's three-year average. That metric is one Buffett has often used to determine whether the company should consider repurchasing shares.
Enviable cash position and more
Berkshire shares may be up by about 8% in 2025, but they lag the S&P 500 by a slightly larger percentage. Much of that underperformance stems from investors' concerns about Buffett stepping down as CEO.
In addition to the stock's underperformance, Berkshire has an enviable cash position and potential for growth in its energy business. Its sprawling energy segment has operations in the U.S., the U.K., and Canada. That business should benefit from the growing electricity demand from artificial intelligence (AI) data centers.
Berkshire stock was trading at record highs earlier this year ahead of Buffett's retirement announcement. The pullback that the news triggered notwithstanding, the conglomerate will be in good hands when Greg Abel takes the helm, and Buffett will remain involved as chairman of the company's board. That makes this a good time to buy the stock.
