Berkshire Hathaway (BRK-B) Declined Following Warren Buffett's Stepping Down as CEO Announcement

Artisan Partners, an investment management company, released its “Artisan Select Equity Fund” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The fund’s Investor Class ARTNX, Advisor Class APDNX, and Institutional Class APHNX returned 6.77%, 6.76%, and 6.80%, respectively, in the second quarter, compared to a 10.94% return for the S&P 500 Index. In addition, you can check the top 5 holdings of the strategy to know its best picks in 2025.

In its second-quarter 2025 investor letter, Artisan Select Equity Fund highlighted stocks such as Berkshire Hathaway Inc. (NYSE:BRK-B). Berkshire Hathaway Inc. (NYSE:BRK-B) engages in the insurance, freight rail transportation, and utility businesses. The one-month return of Berkshire Hathaway Inc. (NYSE:BRK-B) was -0.59%, and its shares gained 8.64% of their value over the last 52 weeks. On September 18, 2025, Berkshire Hathaway Inc. (NYSE:BRK-B) stock closed at $500.03 per share, with a market capitalization of $1.079 trillion.

Artisan Select Equity Fund stated the following regarding Berkshire Hathaway Inc. (NYSE:BRK-B) in its second quarter 2025 investor letter:

"Berkshire Hathaway Inc.'s (NYSE:BRK-B) share price declined 9%. We suspect this was largely due to Warren Buffett’s announcement that he is stepping down as CEO. The CEO transition to Buffett’s lieutenant, Greg Abel, has been widely telegraphed, though the date was never certain. Now it is. We have a number of thoughts around this transition. Buffett and Abel are in many respects a study in contrasts. Abel is a great operator of businesses. Buffett is a great stock picker and capital allocator, but not an operator. In our view, the future of Berkshire will now likely turn more on the value that can be created from operations first and capital allocation second. Abel may improve the operating performance of the businesses due to a greater level of internal scrutiny and focus.

Given the enormous amount of liquidity that Berkshire has and will continue to generate from the free cash flow of its businesses, we suspect cash returns to shareholders will be a greater share of total return than in the past. Simply put, Abel and his team are unlikely to do as many deals and/or invest as much in public equities as Buffett has because he was just better at this aspect of the enterprise. We also believe that over time, Berkshire will become more like a regular public company. Currently, Berkshire does zero investor relations. Its reporting and disclosure are the absolute minimum required by law. Buffett was able to operate like this because he earned and deserved a level of trust never before seen in the public markets. We have an enormous amount of respect for Abel, but he is unlikely to have the same kind of following, nor should he be expected to. As a result, disclosure and investor engagement are likely to increase, perhaps not in the near term, but likely in the medium to long term. Looking far into the future, will the high quality but unrelated nature of the assets under the Berkshire umbrella persist in their current form? This question will at some point likely impact Berkshire’s valuation."

Berkshire Hathaway Inc. (NYSE:BRK-B) is in 15th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 133 hedge fund portfolios held Berkshire Hathaway Inc. (NYSE:BRK-B) at the end of the second quarter which was 125 in the previous quarter. While we acknowledge the potential of Berkshire Hathaway Inc. (NYSE:BRK-B) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Berkshire Hathaway Inc. (NYSE:BRK-B) and shared the list of stocks Jim Cramer recently discussed. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.