Berkshire Hathaway’s cash reserves rise to $397 billion as new CEO Greg Abel deploys capital into a key Buffett-backed stock.
Berkshire Hathaway CEO Greg Abel has begun investing the conglomerate’s $397 billion cash pile, purchasing shares of a stock long favored by predecessor Warren Buffett. The move signals Abel’s strategy to deploy capital amid rising cash reserves, which grew from $373 billion in a single quarter.
Buffett left Abel with a record cash hoard, largely invested in U.S. Treasury bills, to cushion against market downturns. However, the cash drags on performance, as investors expect higher returns from Berkshire’s investments rather than low-yielding assets.
Abel’s decision to buy into Buffett’s preferred stock reflects continuity in investment philosophy while addressing pressure to optimize returns. The shift may reassure shareholders of his ability to manage the firm’s vast resources.