Greg Abel Is Buying Warren Buffett's Favorite Stock -- but He's Unlikely to End the 13-Quarter Net Selling Streak of Berkshire's Former Boss

On Dec. 31, Berkshire Hathaway's (NYSE: BRKA)(NYSE: BRKB) longtime main and billionaire concern guru, Warren Buffett, stepped down arsenic CEO and handed the reins to Greg Abel. Although Berkshire has entered uncharted territory without the Oracle of Omaha steering the ship, it's nevertheless being guided by idiosyncratic whose concern and concern doctrine meshes good with the company's now-former boss.

Recently, Abel made his archetypal large determination arsenic CEO by purchasing shares of Warren Buffett's favourite stock. However, investors who get their hopes up that Abel volition extremity the 13-quarter streak of nett banal income that led up to Buffett's status are apt to beryllium disappointed.

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Although quarterly filed Form 13Fs spill the beans astir which stocks Wall Street's savviest wealth managers were buying and selling, Warren Buffett's favourite banal to bargain isn't recovered successful a 13F. Rather, the company's quarterly operating results item purchases and income of this stock. That's due to the fact that Buffett's favourite banal to bargain was ever shares of his ain company.

In July 2018, erstwhile Berkshire's committee amended the rules governing buybacks to springiness its now-former brag much liberty to repurchase shares, Buffett took the bull by the horns and began buying backmost his Class A (BRKA) and B (BRKB) shares with regularity. Over six years (July 2018 – June 2024), helium spent astir $78 cardinal repurchasing shares.

But successful the 19 months starring up to Buffett's status (June 1, 2024 – Dec. 31, 2025), on with the archetypal 2 months of Abel's tenure, nary shares were repurchased. The crushed wherefore is simple: valuation.

During the six years Warren Buffett repurchased shares, Berkshire Hathaway banal commonly traded astatine a 20% to 50% premium to publication value. When it reached a 60% to 80% premium, helium stopped buying. Value is of the utmost value to Buffett... and Abel!

However, pursuing the merchandise of Berkshire's fourth-quarter operating results and its consequent stock terms swoon, Abel turned connected the spigot and kick-started buybacks. With Berkshire banal concisely hitting a premium to publication worth of 44% (roughly a two-year low), the worth proposition of Buffett's favourite banal had returned.

But portion worth has returned to Berkshire Hathaway stock, the aforesaid can't beryllium said of the broader market. Berkshire's billionaire investing fable sold much stocks than helium purchased for 13 consecutive quarters starring into his retirement, totaling adjacent to $187 cardinal successful cumulative nett selling.