Investors are no longer paying a premium for Berkshire Hathaway (NYSE:BRK)(NYSE:BRK) shares since Warren Buffett stepped down as CEO. Freedom Capital Markets Chief Market Strategist Jay Woods tells Benzinga new CEO Greg Abel is putting his stamp on the company and changing things up, which could pay off long term for shareholders.
Abel Shows Bold Moves
One of the latest moves made by Berkshire Hathaway was taking a position in Alphabet Inc (NASDAQ:GOOG)(NASDAQ:GOOGL), a position that has increased in size and sees the investing conglomerate helping finance the company’s growth.
Woods said the relationship with Alphabet is surprising.
"Here’s a company that’s been around for 25 years. Took them forever to really get involved in Apple and it became a major holding and they made a lot of money off of it. They see the potential here in Alphabet," Woods tells Benzinga.
Woods said that the recent 13F shows that Abel isn’t just "looking at the old traditional Warren Buffett investments."
"They’re broadening their scope and they are getting involved."
The market expert cites a recent purchase of UnitedHealth Group (NYSE:UNH) stock by Berkshire Hathaway that was sold shortly after.
"That was something you didn’t see very often from Warren."
Woods said Berkshire is showing quicker exits in some of its positions.
"They’re looking for opportunities not just for long-term great companies to fit the Berkshire mold, but they’re looking for opportunities for their shareholders where they think something is ridiculously overdone and looking for money to invest."
Along with changes to the main investing portfolio, Woods highlighted insurance stocks that he’s bullish on going forward.
"Insurance is a sector that’s breaking out that I like for the second half of the year."
What’s Next for Berkshire Hathaway
Woods said it "will take some time" for Abel to fully put his stamp on Berkshire Hathaway.
The market expert said he hopes that Buffett is alive for another 15 or 20 years, but thinking about the inevitable outcome for the 95-year-old legendary investor, Woods says there will be a buying opportunity for Berkshire Hathaway shares.
"It’s a great company."
Berkshire Hathaway stock is down 1.1% year-to-date and up 2.8% over the last year.
Compare that to the SPDR S&P 500 ETF Trust (NYSE:SPY), which is up 10.1% year-to-date in 2026 and up 20.2% over the last year.
Berkshire Hathaway outperformed the S&P 500 many years during Buffett’s leadership. The gap is now widening and Abel may need to make more moves to catch up.
A second-quarter 13F filing is expected on Aug. 14, which will reveal what moves Abel made during April, May and June.
Image via Shutterstock
Login to comment