To The Moon

On Monday, November 10, Warren Buffett, the founder of Berkshire Hathaway and widely known as the “Oracle of Omaha,” released his “farewell letter,” confirming the board’s final succession plan and marking the end of a 60-year era of value-investing pilgrimage.

But this doesn’t mean the company stops moving — Greg Abel, whom Buffett has praised as having “far exceeded expectations,” will continue leading Berkshire forward.

At Thursday’s close, $Berkshire Hathaway(BRK.B)$ rose 2.13% against the market, with trading volume surging to $3.74 billion, up 36.66% from the previous day. Notably, a seemingly large buy order appeared right before the close. On the same day, the $S&P 500(.SPX)$ fell 1.66%, with 8 of the index’s top 10 mega-cap constituents declining, many with sizeable losses.

BRK.B intraday movement on Nov 13 (ET). Source: Tiger Brokers.

Since November, $Berkshire Hathaway(BRK.B)$ has risen 7.45%, in sharp contrast with the recent volatility and pullback seen in U.S. tech stocks.So — is BRK.B becoming the new safe-haven favorite?

Tigers, would you include BRK.B in your portfolio — out of faith, or based on investment logic? Feel free to drop a line in the comments and share your thoughts.

Let’s break down the logic behind its “defensive appeal.”

1. What’s Behind BRK.B’s Recent Upside?

Berkshire’s Q3 earnings report on Nov 1 was the key turning point, with multiple metrics beating expectations:

• Insurance underwriting profit jumped 200%, driving operating profit to $13.485B (+34% YoY)

• Net income hit $30.796B, beating expectations by 142%

• Revenue reached $94.972B, slightly above estimates

Source: The company's financial report

① Insurance: The “Positive Surprise”

Insurance underwriting profit soared 2x YoY, beating forecasts by 142% and easing concerns about weakening profitability. This directly pushed operating profit up 34% — and operating profit is Buffett’s most-watched metric. Markets viewed this as proof of Berkshire’s fundamental resilience.

② Cash Reserves: Once a “Double-Edged Sword,” Now a “Safety Premium”

Under uncertainty surrounding Trump 2.0 policies (possible new trade war, tax changes), Berkshire’s $381.6B in cash + short-term Treasuries has become a “strategic ammunition reserve.” It has now risen for 10 consecutive quarters, representing 29% of total assets, a multi-decade high. Investors appear increasingly willing to pay a premium for this “offense + defense” optionality.

③ Leadership Transition: Uncertainty Easing at the Margin

Since the CEO transition announcement in May, BRK.B previously lagged the market (-12% vs. +21% for the S&P 500).

But Q3 earnings — personally released by Buffett — signaled a smooth transition, easing concerns about Greg Abel’s leadership. The market is gradually pricing in stability for the “post-Buffett era.”

2. What Makes BRK.B a “Safe Haven”?

① A Massive Cash Cushion

Buffett has long championed “cash is king.” Record-high cash reserves and strong short-term Treasury gains (price + yield) now rival returns from Berkshire’s equity book — a perfect display of “steady is king.”

② The Side Effect of Share-Buyback Suspension

Due to the 1% buyback tax, Berkshire paused buybacks — unintentionally pushing more capital into higher-yield short-term Treasuries (~5% yield), boosting expectations for better capital efficiency.

③ Macro Environment Adds a “Passive Tailwind”

Berkshire’s railroad, energy, and insurance businesses lean defensive. In volatile markets, these sectors typically outperform tech and communication services.

In 2024, Berkshire’s 28.36% return partly came from its exposure to traditional sectors (energy, consumer, financials), becoming a natural “safe harbor” when tech stocks fluctuate.

Fundamentally, Berkshire’s record cash position + strong insurance performance give $Berkshire Hathaway(BRK.B)$ $Berkshire Hathaway(BRK.A)$ clear defensive characteristics during market turbulence. But — there’s no such thing as a truly risk-free stock. Even Berkshire falls during panic:

• In 2025, after Buffett’s retirement announcement, BRK.B fell 12% before rebounding thanks to Q3 results

• In 2008, BRK.B fell 50% during the financial crisis

• In March 2020, it dropped 25% in 8 days, even worse than the S&P 500

If you want pure safety, short-term Treasury ETFs (e.g., SHV) or money-market funds are the real low-volatility choices.

3. Buffett’s Farewell, Greg Abel Takes Over — What Will the Future Look Like?

Berkshire’s Q4 FY2025 earnings will likely be released around Feb 22, 2026, marking Buffett’s final full earnings report and his last annual shareholder letter. (Abel will take over afterward.)

Buffett’s success was a rare mix of era + luck + skill. The historic level of cash reserves is now Abel’s biggest opportunity — and his biggest test.

“Spend the cash poorly and the stock sells off; don’t spend it, and the market criticizes underperformance.”

The market believes Abel excels at industrial operations, not Buffett-style capital allocation. Expectations include:

• Potentially bolder moves in energy infrastructure and power networks

• Continuation of Berkshire’s insurance float model

• A steady value-investing philosophy

• More caution toward high-volatility sectors under Trump-era uncertainties

Investors will need to closely watch how Abel deploys cash, maintains insurance profitability, and navigates macro policy shifts.

A trillion-dollar company changing leadership is like “turning a giant battleship.” $Microsoft(MSFT)$ ’s long stagnation post-Gates handover remains a historical reminder. So… should defensive investors buy BRK.B now?

Once Buffett steps back, the company loses the “Oracle halo.” Valuation could normalize — or even decline into a discount. Most Wall Street targets remain conservative. They’re not “bullish,” but more like: “keep it steady.”

Rational investors may treat Berkshire as a portfolio stabilizer, not an all-in bet.

So here’s the question:

❓Will you add $BRK.B to your portfolio?[Thinking]

Feel free to leave your comments！[Allin]

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