Sports · Asia Post
After nearly four years of steadily amassing a cash balance of $397 billion, Berkshire Hathaway (BRKA, BRKB) is finally deploying some of that capital. By the end of its second fiscal quarter (June), the conglomerate had reduced its cash reserves to $366 billion, a $31 billion decrease in three months. The bulk of this $31 billion was used for strategic investments.
The largest portion, approximately $17 billion, went toward expanding Berkshire's stake in Alphabet (GOOG, GOOGL), increasing its holdings from 54.2 million 'A' shares (worth $15.6 billion) to nearly $36 billion in total. This makes Alphabet Berkshire's third-largest holding, behind American Express.
Other notable purchases included: - 17.5 million additional shares of Delta Air Lines (DAL), raising its total to 57.3 million. - More than doubling its stake in Macy's (M), adding 4.3 million shares. - $4.5 billion spent on repurchasing Berkshire's own outstanding shares, marking a return to share buybacks after a six-quarter hiatus.
Additionally, Berkshire sold about $3.7 billion in equity holdings, contributing to the net cash increase. The remainder of the cash deployment reflects capital spending or operational costs from Berkshire's privately owned businesses, such as GEICO Insurance, Clayton Homes, Pilot Travel Centers, and Dairy Queen.
CEO Greg Abel, with Warren Buffett's guidance, has shown a measured approach to capital allocation, prioritizing high-quality investments while maintaining long-term patience. This strategy aligns with Berkshire's historical success in stock performance.
Source: The Motley Fool
