Berkshire Hathaway added to its Alphabet and Delta Air Lines positions in the second quarter under CEO Greg Abel. It also spent $4.5 billion repurchasing its own shares, up from about $235 million in the first quarter.
Berkshire Hathaway raised its Alphabet holdings substantially during the second quarter, adding millions of shares of the Google parent. Less than a year into Abel's tenure, the source says, investors are getting an answer on whether he follows Warren Buffett's approach.
Delta stake grows 44%
Berkshire also bought an additional 17.5 million shares of Delta, increasing its stake by 44%. It opened its Delta position in the first quarter, Abel's first as CEO, and now holds more than 57 million shares.
Even after those purchases, Berkshire ended June with approximately $359.2 billion in cash and short-term investments. Abel appears to follow Buffett's philosophy, the source says, although he is becoming more aggressive about putting the money to work.
Buybacks rise to $4.5 billion
The repurchases also stood out. Berkshire spent approximately $235 million on buybacks in the first quarter, then raised that amount to $4.5 billion in the second.
A rule governs these purchases. According to Berkshire's second-quarter regulatory filing, the company can buy back shares only when its CEO determines the price is below its conservatively estimated intrinsic value.
Berkshire bought Class B shares at an average price of $476.01 in May and $487.98 in June. The source describes those figures as actual prices at which Berkshire's leadership was willing to invest billions of dollars in its own business.
A conglomerate with broad exposure
Berkshire owns dozens of businesses, including insurance companies, Duracell and Dairy Queen. Its investment portfolio also holds large stakes in blue chip companies such as Apple and Bank of America, which gives it exposure to several parts of the economy.
Source: Motley Fool
Trading involves risk.
Risk Disclaimer
