The shares of Berkshire Hathaway have been under significant pressure in recent months. This followed after legendary investor Warren Buffett confirmed his intention to step down as CEO.

Berkshire Hathaway shares in correction

According to data from TradingView, the stock price is currently in a long-term correction, representing a drop of more than 8% since the beginning of May. Meanwhile, the S&P 500 index has increased by approximately 18%, creating a 28-point difference in overall performance.

Buffett, now 94 years old, announced during the annual shareholders’ meeting on May 3, 2025 that he would hand over his position to Vice Chairman Greg Abel. Despite his assurances that “the company will be even stronger under Greg’s leadership,” the market reacted cautiously. Investors began to reassess the long-term potential of the conglomerate while considering whether the new management could maintain Buffett’s investment philosophy and track record.

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End of buffett’s premium and new challenges

Analysts claim that the current development may signal the end of the so-called “Buffett premium effect”. This represented investor confidence, which for many years kept the stock price higher thanks to his extraordinary reputation. Buffett managed over more than six decades to transform Berkshire Hathaway into a financial giant valued at over $1 trillion, with his investment decisions becoming legendary.

Berkshire Hathaway is currently, according to the ranking on CompaniesMarketCap, the 11th largest company in the world by market capitalization, which stands at approximately $1.06 trillion. Despite the recent stock decline, the conglomerate remains one of the most influential players in global markets, with a diversified portfolio across multiple industries.

Expectations now, however, face reality. The company faces structural obstacles. Its massive size and high cash reserves make it difficult to find suitable acquisitions that could significantly boost growth. Additionally, Berkshire has, according to Slickcharts, significant exposure to traditional sectors such as insurance, energy, and railroads, which have lagged behind tech companies in recent years.

Investors are therefore facing a dilemma: Whether to maintain trust in the company’s conservative approach or move capital to areas with more dynamic growth. Although Buffett reassures that “Berkshire’s future is in good hands,” the current market shows that his personal influence was a factor not easily replaced.