What’s going on here?
UBS just raised its price target and outlook on Berkshire Hathaway, spotlighting strong insurance results and GEICO’s swift rebound as reasons for its upbeat call.
What does this mean?
Berkshire Hathaway’s recent earnings impressed analysts, showing off sturdy performance in shaky times. The company’s insurance business, central to Warren Buffett’s empire, easily topped forecasts thanks to fewer catastrophe claims and some helpful reserve releases. GEICO, which has trailed rivals recently, posted a sharp turnaround with a combined ratio of 84.3% – better than both its usual numbers and what analysts expected. Meanwhile, BH Re’s underwriting profit almost doubled UBS’s estimate, and Primary Insurance also booked gains from better-than-expected reserve trends. The only real downer came from Berkshire Hathaway Energy, which reported a $100 million wildfire charge. Overall, these results pushed UBS to boost its 2025 earnings forecast and lift its price target.
Why should I care?
For markets: Stability stands out for investors.
In a year marked by volatility, Berkshire Hathaway’s steady hand makes it a standout. The company’s broad insurance reach, deep cash reserves, and disciplined management help it shine when markets get rocky. UBS’s higher price target reflects growing optimism for both A and B shares, with 2025 operating earnings expected to grow. This dependable outlook explains why Berkshire keeps its spot as a go-to pick when markets are looking unpredictable.
The bigger picture: Diversified insurance strength pays off.
Berkshire Hathaway’s strong quarter shows just how crucial insurance can be for global powerhouses. GEICO’s stronger results and solid underwriting overall show how risk control and discipline can fuel profits, even when other divisions face challenges. That mix highlights why diversified companies with strong insurance arms could keep outperforming as economic uncertainty stretches into 2025.
