Berkshire Hathaway (BRK-B) Stock Analysis
Financial ServicesFire, Marine & Casualty Insurance
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fair value with margin of safety
Auto:Defaulting to Book Value — insurance holdings (Berkshire-style) generate value from float and equity holdings, not operating cash flow. Buffett values BRK at ~1.5× book.
Price is 8.6% below fair value but does not yet reach the full 40% margin of safety. Below $356.77, the price would offer the full safety buffer.
40% MoS — higher buffer, no moat detected (Graham's rule for unknown quality).
8-pillar fundamentals screen
Strong fundamentalsHow the moat rating shifts the DCF — concrete parameters, not a vibe.
Without a visible moat, 10-year earnings are less defensible. We compress the terminal multiple (−3) and raise the discount rate (+1pp) to reflect real execution risk. The goal is not pessimism — it's honesty about what we can and can't forecast.
Rule #1: 15 % over 10 years.
How consistent are revenue, EPS, equity, FCF and ROIC?
Need at least 3 stable series; only 1 usable.
What growth is the price implying?
To justify the current price, the market implies will grow at 18.5% annually for 10 years.
2.96× historical growth
Market prices in growth significantly beyond historical trend. Elevated downside risk if growth disappoints.
Five independent methods triangulate a fair value band — no single number decides.
4 methods disagree widely: $165.78 – $747.93 (median $586.35). The model relies on assumptions that differ materially across methods.
Current price $543.66 sits 7.3% below the median — inside or under the fair-value range.
Signals that the company may have a durable advantage
Sector: Financials
Automatic heuristics — always verify with the 10-K.
Qualitative checks a long-term investor would run
EPS volatility 88% — lower is better. Buffett prefers companies whose profits don't swing wildly year to year.
Long-term debt equals 0.0 years of free cash flow. Below 4 is comfortable.
Average ROIC 0.0%. Above 15% is Buffett-grade — the company turns capital into profit efficiently.
5/5 years of positive FCF. Unbroken positive FCF is one of Buffett's strongest filters.
Informational — great compounders often reinvest instead of paying dividends.
Stock FAQ
Common questions about BRK-B valuation, fair value, and analysis methodology.
Finrys estimates BERKSHIRE HATHAWAY INC's (BRK-B) fair value using a probability-weighted Discounted Cash Flow (DCF) model across three scenarios — bearish, base, and bullish — combined with a moat adjustment and Buffett-style quality gate. The current estimate is shown above on this page and updates automatically when new financial data is reported.
The verdict at the top of this page compares BRK-B's current market price to Finrys' moat-adjusted fair value. If price exceeds fair value, the stock is flagged as potentially overvalued; if price is below fair value with a sufficient margin of safety, it is flagged as undervalued. The valuation range chart shows the spread across DCF, reverse DCF, and multiples-based estimates.
BERKSHIRE HATHAWAY INC's DCF is calculated by projecting future free cash flows over 10 years and discounting them to present value at a 10% discount rate. Finrys uses three growth-rate scenarios (worst, base, best) probability-weighted into one fair value, then applies a moat-based premium or discount based on competitive advantage signals.
The valuation range chart triangulates BRK-B's fair value against sector multiples (P/E, EV/EBITDA) so you can see where it sits versus comparable companies. The Buffett checklist additionally scores BRK-B on 10 quality criteria — return on capital, debt levels, margin stability — that value investors use to compare durability across peers.
Compare against other S&P 500 stocks with full DCF and moat analysis.
