Berkshire Hathaway’s new chief executive Greg Abel has made a notable move by buying $4.5 billion of “the Oracle of Omaha’s” favorite stock., the company that Warren Buffett once called the Oracle of Omaha. Abel’s actions come after Buffett stepped down as CEO at the end of December, ending a long era of leadership. While the company’s focus has been on its buyback program, investors are also paying attention to how Abel is using Berkshire’s capital.
Abel has significantly increased Berkshire’s stake in Alphabet, the parent company of Google, since taking over the reins, according to Yahoo Finance. The investment in Alphabet has grown to a value of around $31 billion, making it one of Berkshire’s top holdings, according to a report from inc.com. But the most symbolic purchase by Abel has been in Oracle stock, which Buffett has long held close to his heart.
In the second quarter, Berkshire added to its Oracle position, showing continued support for Buffett’s favorite stock. Berkshire also announced a large share repurchase program during the second quarter, buying back approximately $4.53 billion in Class A and Class B shares. This was the largest quarterly buyback in five years since Berkshire began its repurchase program in 2018.
The total amount spent on buybacks since the rules were changed in mid-2018 has now exceeded $82 billion. Berkshire does not pay dividends, so share repurchases are a way to reward shareholders. By reducing the number of outstanding shares, buybacks increase the ownership stakes of Berkshire’s shareholders.
This approach helps maintain a long-term mindset among shareholders and can reduce market volatility. The buybacks also align with Berkshire’s strategy of returning value to investors in a way that supports long-term growth. Investors are watching closely to see how Abel’s decisions will shape Berkshire’s future direction.
The company’s investments in both Alphabet and Oracle show a continued interest in technology stocks. These moves suggest that Abel is following in Buffett’s footsteps, while also making his own strategic choices. The focus on tech stocks and share repurchases reflects a balanced approach to growth and shareholder value.
Abel’s actions have drawn attention from investors who are eager to see how Berkshire will evolve under his leadership. With Buffett no longer at the helm, the company’s next steps are being closely watched by Wall Street and long-term investors alike.
IMAGE: Warren Buffett speaking to a group of students from the Kansas University School of BusinessImage is cropped and flipped. See original image http://commons.wikimedia.org/wiki/Image:Warren_Buffett_KU_Visit.jpg. Photo: Mark Hirschey / Wikimedia, taken 2005-05-06, CC BY-SA 2.0