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Tilson: Should Street Overreact to Resignation, Berkshire a ‘Buy’

If shares of Berkshire Hathaway sell-off more than 1% in the wake of the recent surprise developments, top hedge fund manager Whitney Tilson of T2 partners tells CNBC's Fast Money that the stock is a buy.

And Tilson may get a chance to put his money where his mouth is.

On Wednesday, shares of Berkshire slipped about 2% in extended trade as investors tried to make sense of reports that David Sokol, a top Berkshire executive, had suddenly stepped down.

To make matters all the more disconcerting Sokol was believed to be on the inside track to succeed Warren Buffett, one day.

Buffett said Wednesday that he received David Sokol's resignation letter late Monday, and noted that it came as a surprise.

Also, Buffett said he learned earlier this month that Sokol bought nearly 100,000 shares of Lubrizol stock before recommending that Berkshire buy the chemical company.

However, Buffett said he doesn't believe those stock purchases were illegal, and didn't ask Sokol to resign. Buffett said Sokol, who had been serving as chairman of Berkshire's MidAmerican Energy, NetJets and Johns Manville units, indicated that he wants to spend more time on philanthropy.

Although there are many different angles to this developing story what matters most to investors is how to trade it.

And as the title of this post suggests hedge fund manager Whitney Tilson of T2 says “if the stock sells off more than 1% we view it as a buying opportunity.

That because he doesn’t think the resignation will usher in major changes at Berkshire. In fact he doesn’t expect any changes at the top for quite a while.

“Buffett is in great shape. He’ll be running Berkshire for at least the next 5 years and we think it’s another 10 years,” says Tilson.

Trader Joe Terranova is a little more cautious. He suggests letting events play out a little longer before pulling the trigger.

But Tilson appears confident that long Berkshire is the right trade. Looking at the company as an investment Tilson says the question becomes, “has Berkshire’s intrinsic value changed and the answer is yes, but microscopically.”






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Trader disclosure: On March 30, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Kinahan Owns (GE) Through Stock And Options; Kinahan Owns (MOS) , Is Short (MOS) calls; Kinahan is Long (NFLX) puts; Kinahan is Owns (YHOO); Kinahan is Short (SPY) through Options; Kinahan Owns (CSCO); Kinahan is Long (TBT) through Options; Kinahan Owns (WAG); Kinahan is Short (XHB) Through Options; Kinahan is Long (MSFT) Through Options; Adami owns (AGU); Adami owns (C ); Adami owns (INTC); Adami owns (MSFT); Adami owns (NUE); Adami owns (BTU); Terranova owns (CNQ); Terranova owns (RSX); Terranova owns (CVI); Terranova owns (DIS); Terranova owns (AKAM); Terranova owns (JNPR); Terranova owns (XOM); Terranova owns (IBM); Terranova owns (TEVA); Terranova owns (BAX); Terranova owns (PBR); Terranova owns (MS); Terranova owns (UPL); Terranova owns ( C); Terranova owns (JPM); Terranova owns (VRTS); Terranova owns (GS); Terranova is long (AAPL) puts; Terranova is long (AKAM) calls

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