Berkshire Hathaway has recently undergone a significant leadership change, with Greg Abel stepping into the role of CEO. In his inaugural shareholder letter, released after taking over from the legendary Warren Buffett, Abel underscored a commitment to the company’s long-standing value investing ethos while delineating four key stocks that he views as essential to the firm’s portfolio.
Abel, who officially took charge in January 2026 following Buffett’s retirement announcement in May 2025, has made it clear that retaining a focus on robust investments is a top priority. The stocks designated as ‘forever holdings’ include Apple (AAPL), American Express (AXP), Coca-Cola, and Moody’s (MCO). These selections represent companies that Abel believes are well understood by Berkshire and possess promising leadership and growth prospects.
In his letter, Abel expressed confidence in these firms, suggesting that Berkshire will maintain limited transactional activity regarding these stocks unless their long-term outlook significantly changes. Remarkably, these four holdings, alongside stakes in five prominent Japanese trading companies, constitute approximately two-thirds of Berkshire’s total equity portfolio, together valued at over $200 billion.
Absences That Raise Eyebrows
Interestingly, two of Berkshire’s largest investments, Bank of America and Chevron, did not make it onto Abel’s list of core stocks. Recently, Berkshire has halved its stake in Bank of America, now holding around 517 million shares worth approximately $28 billion. Meanwhile, the Chevron position, valued at about $20 billion, also raised questions among analysts for its absence from the ‘forever’ category.
Berkshire’s investment in Apple is particularly noteworthy. The conglomerate’s average purchase price was around $27 per share, far below the current price of approximately $264. Previously, Buffett had reduced Apple holdings substantially, but Abel’s recent statements indicate that no further reductions are planned.
Earnings Report Highlights Challenges
Compounding matters, Berkshire Hathaway reported substantial fluctuations in its fourth-quarter operating earnings, which plunged by 29% year-over-year to $10.2 billion, primarily affecting the insurance segments. However, the company still reported an impressive $44.5 billion in operating earnings for the full year of 2025, besting the five-year average of $37.5 billion, albeit lower than the previous year’s $47.4 billion.
At the close of Q4, Berkshire’s cash and Treasury holdings amounted to $373.3 billion, slightly declining from $382 billion in the prior quarter. Abel characterized this capital as ‘dry powder’ poised for deployment when suitable investment opportunities arise.
Looking ahead, the management of Berkshire’s day-to-day equity portfolio remains a crucial topic, especially as Abel himself lacks a background as a portfolio manager. Current investment manager Ted Weschler will oversee only 6% of the company’s investments, maintaining his role from the days of Buffett’s leadership.
Abel emphasized the gravity of his role in capital allocation decisions, stating, “responsibility ultimately rests with me as CEO,” while noting that Buffett will serve in an advisory capacity.
Abel’s first shareholder letter marks a significant moment in Berkshire Hathaway’s storied history, reflecting both continuity and change as the company transitions to new leadership while upholding its foundational investment principles.
