Berkshire Hathaway barely flinched after its latest report, with the stock easing just 0.01% on Friday even as fresh Q3 2026 numbers hit the tape. On the surface that muted move looks like a shrug. Underneath, it reflects investors weighing a very profitable quarter, with US$105.6b in revenue and US$22.1b in net income, against a longer runway where analysts now expect earnings to decline about 5.7% a year over the next three years.
The real story for long term holders is that this earnings season is less about the latest quarterly swing and more about how that forecasted earnings pressure meshes with Berkshire Hathaway's current valuation.
If you appreciate Berkshire Hathaway's earnings power but feel uneasy about the projected 5.7% annual decline in forecasts over the next few years, consider balancing that view with our screener of list of solid balance sheet and fundamentals stocks (24 results) .
Q3 2026 Earnings Summary
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Revenue (Q3 2026 vs. Q3 2025):US$105.6b vs. US$95.0b (higher top line in the latest quarter)
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Net Income (Excl. Extra Items, Q3 2026 vs. Q3 2025):US$22.1b vs. US$30.8b (lower quarterly profit)
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Basic EPS (Q3 2026 vs. Q3 2025):US$17,868.44 vs. US$21,412.53 (earnings per share declined)
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Trailing 12M Net Margin (Q3 2026 vs. prior year):19.5% vs. 18.1% (margin higher on a trailing basis)
Earnings are up, forecasts are down, and the valuation is split. Ask Charlie what makes Berkshire Hathaway look undervalued today .
Berkshire bullish thesis meets mixed execution signal
Optimists argue Berkshire Hathaway can keep compounding through its business mix and disciplined successors.
"Analysts expect Berkshire Hathaway to continue benefiting from its mix of utility, insurance, housing and concentrated equity holdings, with some highlighting recent earnings contributions from non insurance businesses and current share price targets above the market level."
Q3 tells a more blended story. Group revenue was US$105.6b while net income was US$22.1b and basic EPS declined year on year. Earlier commentary flagged weaker insurance underwriting and lower investment income with rail and energy helping. That pattern supports the diversified engine but also shows some cylinders misfiring.
Bear case on leadership and risk appetite under review
Skeptics worry the post Buffett era might dilute Berkshire Hathaway's edge on discipline and risk control.
"The main condition for this view is that Berkshire Hathaway's post Buffett leadership under Greg Abel and Howard Buffett maintains the existing culture, capital allocation discipline and measured approach to opportunities such as AI related power demand and global insurance expansion."
Recent quarters highlight both continuity and stretch. Record US$9.6b buybacks and a US$377b cash and T bill pile show restraint. At the same time, sizeable Alphabet and Bending Spoons positions have faced marked to market pressure, which tests the idea that newer tech exposure will be pursued with the same measured tempo as legacy bets.
One Narrative disagrees with today's price. → See where this Narrative says Berkshire Hathaway should trade .
Hunt For Earnings Disconnects
Berkshire Hathaway just showed that solid earnings can accompany a restrained share price move. The real opportunity is identifying stocks that appear undervalued before the market adjusts.
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Company 1 - 50% below our estimate - uses an AI driven revenue cycle platform to replace fragmented billing tools as payer rules grow.
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Company 2 - 29% below our estimate - expands digital banking and insurance services that convert underused credit demand into fee and interest income.
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Company 3 - 30% below our estimate - pursues a bank acquisition and automation platform to fund higher margin consumer loans with a lower cost deposit base.
Those are three of them. See all 36 potentially undervalued companies →
This article is general in nature and was produced with the assistance of AI automation, based on data and analysis from Simply Wall St. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include BRK-A .
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