Warren Buffett’s stock has been crashed since retirement announcement

This sell-off highlights what many call the “Buffett premium.” This is the extra value investors have been willing to pay for years due to Buffetts unmatched track record and skill in managing capital.

It can be argued that the market seems to be reevaluating that premium as Buffett prepares to pass on his leadership.

This decline has occurred despite Buffett‘s confidence in his successor, Greg Abel, and his ability to maintain the company’s culture and long-term success. Still, investors seem to be cautious.

Interestingly, Buffett once predicted Berkshires stock would rise after retirement, but the opposite has occurred.

To add to the pressure, Berkshires first-quarter earnings were disappointing, which may have raised investor concerns. Operating earnings for the quarter fell 14% from the previous year to $9.64 billion as its insurance and railroad sectors faced significant challenges.

The decline was mainly due to weaker insurance underwriting. However, Berkshire ended the quarter with a record $347.7 billion in cash, up from $334.2 billion, as it reduced equity purchases.

Notably, Buffett did not approve share buybacks, stating no investments met the companys rigorous valuation standards.

This growing cash reserve has sparked speculation about possible acquisitions or moves under new leadership. Others view it as a safeguard against a potential economic downturn from uncertainty triggered by the controversial trade tariffs and the geopolitical tensions in the Middle East.