Berkshire Hathaway (NYSE: BRKA)(NYSE: BRKB) bought back $4.5 billion in stock in the second quarter, its first major buyback activity since early 2024. While other companies buy back billions of dollars in stock, Berkshire's buyback program is a unique one.
Specifically, Berkshire buys back stock only when its leaders believe it trades at a considerable discount to intrinsic value. This lets investors use Berkshire's buyback as a signal that the stock might be cheap.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
Of course, there's more to the story. For one thing, Berkshire started the second quarter with a record high $397.4 billion in cash and Treasuries, and new CEO Abel has been eager to find ways to put it to work.
Also, the second quarter's buyback could be an especially strong signal that Abel believes the stock is cheap right now. Not only is $4.5 billion the most Berkshire Hathaway has spent on buybacks in a single quarter since 2021, but Berkshire's buybacks in recent years have generally occurred while Berkshire was a net seller of stocks.
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Specifically, Berkshire buys back stock only when its leaders believe it trades at a considerable discount to intrinsic value. This lets investors use Berkshire's buyback as a signal that the stock might be cheap.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
Of course, there's more to the story. For one thing, Berkshire started the second quarter with a record high $397.4 billion in cash and Treasuries, and new CEO Abel has been eager to find ways to put it to work.
Also, the second quarter's buyback could be an especially strong signal that Abel believes the stock is cheap right now. Not only is $4.5 billion the most Berkshire Hathaway has spent on buybacks in a single quarter since 2021, but Berkshire's buybacks in recent years have generally occurred while Berkshire was a net seller of stocks.
#second
11 days ago
