Berkshire just reported Q2 operating profit of $12.98B, up 16% YOY, while net income more than doubled to $25.7B. They also bought back about $4.5B of stock, were a net buyer of equities for the first time since 2022, including $10B for GOOGL, and cash and cash equivalents dropped from roughly $397B to $366B.
Buffett spent the last few years basically saying there wasn't much worth buying, and investors assumed his stockpiling of cash meant he believed he was waiting for a downtown that would offer better opportunities. Now Abel is stepping in and Berkshire is spending capital, even with the S&P 500 near record highs. Could be timing. Could be a different approach. Who knows, too early to say.
Berkshire is only up around 3-4% YTD versus roughly 13% for the S&P 500, so the market clearly isn't giving Abel the same confidence Buffett had.
Is Berkshire getting more aggressive because they finally see value again, or are we actually watching the investment philosophy change since Buffett? And at today's valuation, would you rather own BRK.B or just buy the S&P 500?