Berkshire Hathaway shares fell Monday after the conglomerate reported a sharp decline in fourth-quarter operating earnings, while new CEO Greg Abel offered few signs of an immediate strategic shift in his first communication with shareholders.

Class A shares of the Omaha-based conglomerate slid 4.8% to start the week. The stock’s decline came after Berkshire posted operating earnings of $10.2 billion for the fourth quarter, down more than 29% from $14.56 billion a year earlier. The drop was driven largely by weakness in the insurance business, where underwriting profits tumbled 54% to $1.56 billion from $3.41 billion in the year-earlier period.

The results mark an early challenge for Abel, who succeeded Warren Buffett as CEO at the start of 2026. While investors had broadly praised Abel’s first annual shareholder letter for reaffirming Berkshire’s long-standing culture of financial strength and disciplined investing, some had hoped for more aggressive signals on capital deployment given the company’s swelling cash balance.

Berkshire ended 2025 with more than $370 billion in cash and Treasury holdings. In the letter, Abel reiterated that the company does not plan to initiate a dividend so long as it believes retained earnings can create more than a dollar of market value for shareholders.

“We were just a little surprised by the absence of any sort of dividend, and a little more by the stated sustained unwillingness to pay dividends,” Meyer Shields, an analyst at KBW said in a note. “Given Berkshire’s very significant current cash position and — just as important, in our view — its prospects for sustained cash generation, we’d seen some chance of persistent dividends accompanying the CEO transition.”

Abel instead emphasized reinvestment and opportunistic share repurchases when Berkshire stock trades below intrinsic value, maintaining the capital allocation framework long championed by Buffett.

Still, not all analysts were bearish. Brian Meredith of UBS said that while quarterly results came in weaker than expected, Berkshire’s defensive characteristics could support the stock.

“We actually anticipate BRK’s shares will outperform the broader market given the elevated geopolitical tensions,” Meredith wrote in a note to clients. “BRK is generally considered very defensive. Historically, BRK shares have outperformed during periods of market volatility benefiting from their diversified earnings streams, liquidity position, and largely U.S.-focused businesses.”

Meredith added that Berkshire’s annual letter reiterated those core principles and values. Looking ahead to 2026 and 2027, he expects management to focus on improving operating margins at BNSF to bring them closer to industry peers and boosting policy retentions at Geico while maintaining profitability.