Buffett Watch: Berkshire Is a Bargain

Investors with a few hundred thousand dollars to spare who are hunting for a bargain in financial services stocks ought to buy a few shares of Berkshire Hathaway (BRK.A Quote), according to a KBW report released Monday.

Analyst Cliff Gallant initiated the firm, headed by billionaire Warren Buffett, with an outperform rating and a target price of $107,000, 24% above its closing price of $86,210 on Friday. Despite fears that Berkshire's exposure to derivatives and a broader decline in its investments amid a global economic slump, Gallant believes Berkshire will come out ahead.

"Berkshire is a myriad collection of high-quality businesses, particularly in insurance and reinsurance, with attractive long-term growth prospects," Gallant writes. "Despite negative marks in its derivative portfolio, the recent global financial turmoil has left Berkshire standing tall as one of the world's few financially sound institutions." ...