UBS Trims Berkshire Target but Stays Bullish, Betting on GEICO and Buffett's $347B War Chest

Berkshire Hathaway Inc. (NYSE:BRK-B) is one of the stocks that Donald Trump owns. On June 3, UBS lowered its 12-month price target for Berkshire Hathaway Class B shares from $606 to $591, citing softer expectations for dividend income and lower cash yields. The firm cut its 2025 earnings forecast to $29,882 (Class A equivalent), down from $31,789, and made a slight downward revision to 2026 as well.

UBS also removed any assumption of share buybacks for 2025 and 2026, noting that the stock is trading at a 9% premium to intrinsic value — a sharp contrast to the average 15% discount since buybacks resumed in 2018. Berkshire did not repurchase any shares in the first quarter.

Despite the reduced estimates, UBS maintained a Buy rating, highlighting Berkshire’s resilience in an uncertain environment. The company’s $347 billion in cash and short-term holdings, along with its diversified, defensive business mix and minimal tariff exposure, were cited as core strengths.

One potential upside catalyst is GEICO. UBS expects its combined ratio to improve to the mid-to-high 90s by 2027, with market share gains potentially starting this year. A GEICO rebound could lift insurance earnings and expand Berkshire’s float, key drivers of long-term value.

Berkshire Hathaway (NYSE:BRK-B) is Warren Buffett’s long-standing holding company, which sprawls across insurance (GEICO, Gen Re), utilities, railroads, manufacturing and more.

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Disclosure: None.