Berkshire Hathaway Inc. (BRK-B) Stock Valuation — PE Analysis
Insurance - Diversified · NYSE
Current Price
$489.25
PE Ratio (TTM)
14.6x
Intrinsic Value
$538.58
+9.2% margin of safety
COMPETITIVE MOAT
↑Berkshire's Diversified Conglomerate Structure
Berkshire Hathaway's vast collection of wholly-owned businesses across diverse sectors provides significant operational synergies and financial resilience. This structure allows for capital allocation flexibility and reduces reliance on any single industry.
↑Buffett's Enduring Reputation and Capital Allocation
Warren Buffett's legendary investment acumen and the trust he inspires attract capital and favorable deal terms. His disciplined approach to capital allocation has consistently generated long-term shareholder value.
↑Strong Insurance Underwriting and Investment Float
Berkshire's insurance operations generate substantial 'float' – premiums collected before claims are paid. This low-cost capital is then invested, creating a powerful compounding engine for the company.
INVESTMENT RISKS
↓Succession Risk and Buffett's Influence
The eventual departure of Warren Buffett, despite Greg Abel's ascension, could lead to a shift in investment philosophy or market perception. His personal brand is deeply intertwined with Berkshire's success.
↓Concentration Risk in Key Holdings
While diversified, Berkshire's significant stakes in companies like Apple and its recent backing of Alphabet's stock sales create exposure to the performance of these specific giants. Any downturn in these major holdings could impact overall results.
↓Housing Market Cyclicality and Interest Rate Sensitivity
The planned acquisition of Taylor Morrison highlights Berkshire's increasing exposure to the housing sector. This segment is inherently cyclical and sensitive to interest rate fluctuations, posing a risk to profitability.
Base case
BRK-B base case PE valuation
A base case PE valuation for BRK-B estimates a fair value of about $538.58 per share, against a current price of $489.25. The model assumes 4.7% annual earnings growth, a 15x target PE multiple, and a 10% discount rate.
Intrinsic Value
$538.58
Margin of safety
+9.2%
Expected annual return
+1.9%
Base case assumptions: 4.7% annual earnings growth, 15x target PE, 10% discount rate, 5 year projection. Data as of 2026-06-12.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the BRK-B PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for Berkshire Hathaway Inc. respond.
Open PE Calculator for BRK-BCompany Overview
Berkshire Hathaway Inc., established in 1998 and headquartered in Omaha, Nebraska, operates as a vast global conglomerate with diverse business interests. Its core operations primarily encompass insurance, freight rail transportation, and utility services. The company provides a comprehensive suite of insurance and reinsurance products, including coverage for property, casualty, life, accident, and health. Across North America, it manages extensive railway networks dedicated to freight transport. Its utility division is responsible for generating, transmitting, storing, and distributing electricity sourced from various origins such as natural gas, coal, wind, solar, hydroelectric, nuclear, and geothermal energy. This segment also oversees natural gas infrastructure, including distribution networks, storage facilities, interstate pipelines, and liquefied natural gas (LNG) operations, alongside its interests in coal mining. Beyond these foundational sectors, Berkshire Hathaway boasts a significant manufacturing footprint. It produces a wide array of goods ranging from confectionery and specialty chemicals to metal cutting tools and components for both aerospace and power generation applications. Its manufacturing portfolio also extends to flooring products, insulation, roofing materials, engineered building components, paints, coatings, and bricks. The company is also involved in residential construction, offering both manufactured and site-built homes, supplemented by related lending and financial services. Its product offerings further include recreational vehicles, apparel, footwear, jewelry, custom picture framing, and alkaline batteries. On the industrial side, it manufactures specialized components like castings, forgings, fasteners, aerostructures, and precision parts, often utilizing advanced alloys such as cobalt, nickel, and titanium. Additionally, Berkshire Hathaway provides a variety of services, which include distributing electronic components, franchising and servicing quick-service restaurants, offering logistics, grocery, and foodservice distribution, as well as professional aviation training and shared aircraft ownership programs. Finally, the company maintains a substantial retail presence, selling an extensive selection of products such as automobiles, furniture, home appliances, electronics, computers, jewelry, and kitchenware, in addition to motorcycle clothing and equipment.
Financial Metrics — BRK-B PE Stock Valuation Data
PE Ratio (TTM)
14.6x
PEG Ratio
n/m
Earnings Yield
6.87%
ROE (TTM)
10.3%
Revenue/Share (TTM)
$174.02
Debt/Equity
0.20x
Frequently Asked Questions
What is the PE ratio of BRK-B?
The trailing twelve-month PE ratio of BRK-B reflects how much investors pay per dollar of Berkshire Hathaway Inc.'s earnings. This metric is most useful when compared to Insurance - Diversified peers and the company's own historical range.
Is BRK-B overvalued based on PE ratio?
BRK-B's PE of 14.6x combined with a PEG ratio of -1.39 provides a growth-adjusted perspective. BRK-B has negative earnings, so its PE and PEG ratios are not meaningful here and cannot tell you whether the stock is over or undervalued. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Insurance - Diversified, a DCF analysis may be more appropriate.
How do I value BRK-B stock using PE ratio?
To value Berkshire Hathaway Inc. using PE: (1) Compare the current PE (14.6x) against the Insurance - Diversified median to assess relative pricing, (2) check the PEG ratio (-1.39) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of BRK-B?
BRK-B's PEG ratio is -1.39, calculated by dividing the PE ratio (14.6x) by the expected earnings growth rate. Because BRK-B has negative earnings, its PEG ratio is not meaningful and should not be read as a sign of under or overvaluation. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for BRK-B stock valuation?
PE ratio gives a quick relative read — how BRK-B is priced versus Insurance - Diversified peers. DCF provides an absolute value based on projected free cash flows. For the most reliable valuation, use PE as a quick comparability screen and DCF for a deeper fundamental analysis. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See BRK-B DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Financial Services valuationsP/E and DCF value BRK-B with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-06-12. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.