Rail, Energy and Buybacks Offset Berkshire's Underwriting Squeeze
Published on 11/08/2026 at 19:03 | Editorial boerse-global.de
Berkshire Hathaway's third-quarter 2026 figures landed with a familiar split verdict: the conglomerate's industrial and energy arms kept growing, its insurers did not, and the stock has still managed to leave the broad market far behind.
The headline number was softer. Operating profit slipped 5.8% year on year to $12.705 billion, down from $13.5 billion in the same quarter a year earlier. Net income attributable to shareholders came in at $22.1 billion, well below the $30.8 billion booked twelve months prior.
What cushioned the decline was the breadth of the non-insurance side. BNSF lifted profit 19%, Berkshire Hathaway Energy added 8%, and the manufacturing, services and retail operations together posted 12% earnings growth. Precision Castparts chipped in with a 30% jump in pre-tax profit.
At the railroad, the operating picture improved on both volumes and pricing. Traffic rose 3.9% while average revenue per unit climbed 10.5%, pushing the operating ratio down to 63.8%. That combination suggests BNSF is translating higher rates and heavier shipments into better margins even as costs rise — though fuel expenses already weighed on the quarter and the buffer is not unlimited.
Should investors sell immediately? Or is it worth buying Berkshire Hathaway?
GEICO's loss ratio is the number to watch
The counterweight sits in auto insurance. GEICO's loss ratio climbed to 76.6% from 71.5% a year earlier, a deterioration Berkshire attributed to more frequent and more expensive claims alongside lower average premiums earned per policy. Insurance operating expenses rose 17% over the same stretch.
If that pressure persists, the rest of the group will have to carry more of the load. The question for investors is whether rail, energy and the industrial businesses can keep growing fast enough to offset it — and whether underwriting results stabilize at the same time. A recovery built on several strong divisions would be a more convincing signal than one resting on a single subsidiary.
Capital returns have reinforced the case. Berkshire repurchased $9.6 billion of its own stock in the third quarter and roughly $2 billion more in October, according to Reuters. The agency pointed to the buybacks, the strength of the balance sheet and the diversified defensive profile as factors drawing investor support, without identifying a single trigger for the run.
Since September 30, the shares have outperformed the S&P 500 by more than 18 percentage points.
Berkshire Hathaway at a turning point? This analysis reveals what investors need to know now.
Sirius XM stake gets bigger
Alongside the buybacks, Berkshire added to an existing holding. A mandatory disclosure filed Tuesday showed the company bought about 924,000 more Sirius XM shares between October 30 and Tuesday, lifting its reported position to 125.7 million shares.
The next test comes Monday, November 9, 2026, the first regular US trading session to react to the quarterly release. A portfolio filing is also due in the following week and could shed light on how Berkshire is positioning its equity investments under CEO Greg Abel. Until then, the debate hinges on one balance: whether the growing divisions can outrun the claims pressure at GEICO.
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