Berkshire Hathaway, GE’s $11.75 billion casting deal revives Precision Castparts value

3-Line Briefing

• GE Aerospace announced this week that it would pay $11.75 billion to acquire Consolidated Precision Products, one of the few companies competing with Berkshire Hathaway subsidiary Precision Castparts.
• CNBC reports that the price equals 26 times projected 2027 earnings before interest, taxes, depreciation, and amortization; applying that multiple, Barron’s estimated Precision Castparts at about $100 billion.
• The reference point arrives after Berkshire Hathaway acquired Precision Castparts for $37.2 billion in 2016 and later recorded an $11 billion write-down, while Berkshire’s Class A and Class B shares gained almost 0.9% this week as the S&P 500 fell 0.8%.

What Changes for Berkshire Hathaway

For Berkshire Hathaway investors, the GE Aerospace transaction changes the conversation from a past write-down to the value of a scarce industrial asset. CNBC reports that Precision Castparts produces complex metal components and products, including parts essential for engine turbine blades. The same products are also used in natural-gas turbines, which are in demand for producing energy for artificial-intelligence data centers. That combination gives the subsidiary exposure to aerospace manufacturing and power infrastructure, but the supplied facts do not establish its current revenue, earnings, or audited standalone valuation.

Warren Buffett acknowledged in his annual letter that Berkshire had paid “too much” for Precision Castparts and had been “simply too optimistic” about its profit potential. In a CNBC interview when the deal was announced, he called the purchase price “a very high multiple for us to pay.” The later $11 billion write-down documents the earlier miscalculation; it does not by itself determine what the business is worth today.

The new transaction supplies an observable market comparison, not a completed revaluation of Berkshire’s subsidiary. Consolidated Precision Products competes against Precision Castparts, and GE Aerospace’s announced acquisition gives investors a disclosed price for one comparable business. Whether that price transfers cleanly to Precision Castparts depends on differences that are not provided in the source, including each company’s operating results, mix of products, and terms. The completion date and closing conditions for GE Aerospace’s acquisition are also unknown.

By the Numbers

Berkshire Hathaway paid $37.2 billion for Precision Castparts in 2016, according to CNBC, and later took an $11 billion write-down related to the acquisition six years ago. This week, GE Aerospace announced an $11.75 billion acquisition price for Consolidated Precision Products. Barron’s described that price as 26 times projected 2027 earnings before interest, taxes, depreciation, and amortization.

Using the same 26-times multiple, Barron’s estimated Precision Castparts at around $100 billion. That compares with a potential value of $60 billion to $75 billion cited last month. The $100 billion estimate is roughly three times Berkshire’s 2016 purchase price, but it is an estimate rather than a confirmed transaction value for Precision Castparts. CNBC also reports that Berkshire held $365.5 billion in cash as of June 30, down 8.0% from March 31; cash excluding rail cash and subtracting Treasury bills payable was $359.2 billion, down 3.8%. Berkshire repurchased $4.5 billion of its shares in the second quarter of 2026.

Winners & Losers

• Berkshire Hathaway (BRK.B): The company may receive a more favorable market reference for Precision Castparts because GE Aerospace agreed to pay $11.75 billion for a competing casting business. CNBC reports that Berkshire’s Class B shares still trail the S&P 500 by more than 10 percentage points in 2026 year to date, so investors may debate whether the subsidiary’s potential value is reflected in the stock.
• GE Aerospace (GE): The announced purchase gives GE Aerospace control of Consolidated Precision Products, a competitor to Precision Castparts. The source confirms the price and competitive relationship but does not provide GE’s expected financial benefits, financing terms, or completion conditions.
• Aerospace and complex-metal-casting suppliers: The transaction highlights demand for complex castings used in engine turbine blades. CNBC also reports applications in natural-gas turbines serving artificial-intelligence data-center power demand, but it does not provide sector-wide sales, margins, or capacity figures.

Risk Check

• The $100 billion Precision Castparts figure is an estimate based on a comparable company’s 26-times projected 2027 EBITDA multiple, not an audited standalone valuation or announced sale.
• Precision Castparts’ current revenue and earnings are not supplied, limiting any judgment about whether the multiple is supported by operating performance.
• GE Aerospace’s Consolidated Precision Products acquisition has an unknown completion date and unknown closing conditions; the announced price may not yet represent a completed transaction.
• Andrew Bary told CNBC that Berkshire and its share price were “not getting much credit” for the subsidiary’s rising value, arguing that Berkshire may need to tell its story to attract a new generation of investors. That communication issue could limit how quickly any private-unit valuation reference affects BRK.B.

Bottom Line

CNBC’s reporting supports a constructive but conditional read-through for Berkshire Hathaway: a rival’s $11.75 billion announced sale, valued at 26 times projected 2027 EBITDA, creates an external benchmark that points to a potentially higher value for Precision Castparts than the $60 billion-to-$75 billion estimate cited last month. The counterpoint is material: Berkshire’s own $100 billion figure remains an estimate, Precision Castparts’ current financial results are not provided, and the GE Aerospace deal is not yet confirmed as closed. Investors’ next checkpoints are evidence of the transaction’s progress, clearer disclosure of Precision Castparts’ operating performance, and whether Berkshire’s capital-return and investor-communication choices—including the $4.5 billion of second-quarter 2026 repurchases—change the market’s treatment of the subsidiary.

FAQ

Why is GE Aerospace’s Consolidated Precision Products deal relevant to Berkshire Hathaway?

Consolidated Precision Products competes against Precision Castparts, a Berkshire Hathaway subsidiary. CNBC reports that GE Aerospace announced an $11.75 billion purchase this week, creating a disclosed comparison for investors assessing Precision Castparts.

How much did Berkshire Hathaway pay for Precision Castparts?

Berkshire Hathaway acquired Precision Castparts for $37.2 billion in 2016, according to CNBC. Berkshire later recorded an $11 billion write-down related to the business six years ago.

What is Precision Castparts estimated to be worth?

Using the 26-times projected 2027 EBITDA multiple cited for the Consolidated Precision Products transaction, Barron’s estimated Precision Castparts at about $100 billion. The source also cites a $60 billion-to-$75 billion potential value from last month, and neither figure is a confirmed audited standalone valuation.

This article was independently written by OneDayTrading from public reporting. Read the original (CNBC)