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Berkshire Hathaway chief executive Greg Abel ploughed a net $19.8bn into the stock market in the second quarter, ending a more than three-year selling streak by his predecessor Warren Buffett.
The investments, which include a $10bn deal to buy Alphabet common stock and $4.5bn spent on Berkshire’s own shares in the quarter, signal Abel’s appetite to leave his mark on the Omaha-based insurer by putting some of its mammoth $366bn cash pile to work.
Buffett’s decision to sit on the sidelines and prune the company’s $324bn listed stock portfolio over the past three years was seen as a sign that the famed value investor thought equities were overvalued.
That makes Abel’s decision to jump back into the market all the more stark, particularly as US equities sit at record highs.
Over the past few decades, Buffett has been closely watched for signs of where the market might be headed. The record cash pile he had accumulated unnerved some investors, who suspected he was waiting for a downturn that would provide him with a better opportunity.
Berkshire, which owns the Geico and National Indemnity insurers as well as the maker of Duracell batteries and Fruit of the Loom underwear, reported its cash levels dropped by $15bn in the quarter. That figure is adjusted for the value of US government debt Berkshire bought but had not yet paid for.
Abel replaced Buffett at the start of the year after one of the longest and most influential tenures by an executive in the American corporate world. Buffett had run Berkshire for six decades, taking over the then-struggling textile maker in 1965.
Abel, who started his career as an accountant before rising through Berkshire’s energy business, has begun to forge his own legacy at the business. Days after anchoring an $85bn capital raise by Alphabet, Abel announced Berkshire had agreed to buy home builder Taylor Morrison for an enterprise value of $8.5bn.
The two deals were among the largest transactions Berkshire has completed in recent years and showed Abel was, as he said at the company’s annual meeting in May, willing to act “decisively” and make “significant” investments.
Berkshire spent $23bn buying publicly listed stocks in the second quarter, including the deal with Alphabet, making the parent of Google one of its top five holdings.
Disclosures on Saturday signalled Berkshire had invested $21bn into “commercial, industrial and other” listed stocks in the three months to the end of June, a category that includes Alphabet.
Investors will get a clearer look at the changes to Berkshire’s stock portfolio this month when it reports its quarterly holdings to US securities regulators.
The company sold $3.7bn of stock during the quarter, the smallest amount since 2022.
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