Berkshire Annual Meeting: Will Buffett Charm Away Stock's Short-Term Correction?

The highly anticipated Berkshire Hathaway (NYSE:BRKb) (NYSE:BRKa)Shareholders' Meeting, nicknamed the "Woodstock for Capitalists," is set to take place this weekend.

This iconic event has transformed over the years, evolving far beyond a typical shareholder gathering. Investors flock to the meeting not only to connect with fellow shareholders but also for the chance to witness and hear legendary investor Warren Buffett speak live.

However, the mood surrounding the event is tinged with a touch of caution. Berkshire Hathaway's stock is currently undergoing a correction. This, coupled with the Fed's continued hawkish stance, raises the possibility of further downside for the stock.

Beating analyst expectations could help slow this trend before it reaches its initial target zone. This correction is not out of the ordinary, considering last year's strong performance where most results surpassed forecasts.

Source: InvestingPro

Buffett's Portfolio Structure Mostly Unchanged

Analyzing the latest F13 filings, Berkshire Hathaway's portfolio composition remains largely unchanged. Apple (NASDAQ:AAPL) retains its biggest holding, exceeding 50%, followed by Bank of America (NYSE:BAC) and American Express Company (NYSE:AXP).

Source: InvestingPro

According to InvestingPro's fair value analysis, the leading stocks show negative fair values (except AXP), suggesting a potential correction ahead.

Source: InvestingPro

Source: InvestingPro

Apple's earnings release today will significantly impact not only the company itself but also Buffett's portfolio performance.

Analyst Revisions Remain Limited Ahead of Earnings

Analyst revisions for both A and B share classes of Berkshire Hathaway are scarce and have minimal influence on the projected earnings per share or revenue. For the B class, which is more accessible to retail investors, the current forecasts are:

Source: InvestingPro

Traditionally, these forecasts serve as a key reference point for investors to gauge potential upside or downside in the final results.

How Long Could the Correction Last?

If a corrective price movement occurs, the technical analysis suggests ample room for the stock to move downwards. The next target for sellers would be the confluence of the upward trend line and the support zone around $370 per share.

A decisive break below this area would signal a strong bearish trend. However, such a significant decline would likely require a substantial miss in the earnings report, coupled with a broader market sentiment turning risk-averse.

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Disclaimer: The author does not own any of these shares. This content, which is prepared for purely educational purposes, cannot be considered as investment advice.