Berkshire Hathaway Inc. (NYSE: BRK.B) faces a pivotal session on Monday as investors digest the conglomerate's first major portfolio shakeup under the leadership of Greg Abel, the designated successor to Warren Buffett. The company's latest quarterly filing, released after the market close on Friday, reveals a significant repositioning of its equity holdings, including a $2.65 billion stake in Delta Air Lines (NYSE: DAL) and new positions in Macy's (NYSE: M) and Alphabet (NASDAQ: GOOGL). At the same time, Berkshire completely exited its positions in Amazon (NASDAQ: AMZN), UnitedHealth (NYSE: UNH), Visa (NYSE: V), Mastercard (NYSE: MA), Domino's Pizza (NYSE: DPZ), Aon (NYSE: AON), and Pool (NASDAQ: POOL), while trimming its stake in Chevron (NYSE: CVX) by 35%.
Berkshire's Class B shares closed Friday at $482.70, down 0.3% for the session, but still up 1.4% over the prior week. The S&P 500 was little changed on the week, adding just 0.1% despite a Friday decline driven by rising oil prices and higher Treasury yields. The filing, which reflects holdings as of March 31, was submitted at 4:06 p.m. EDT Friday, meaning the regular market had no opportunity to react. After-hours trading saw Delta jump 3.3% and Macy's climb 6.3%, though such moves can be volatile and may not persist when regular trading resumes.
The Abel Effect
This 13F filing is the first clear window into Abel's portfolio strategy since he took on a more prominent role. At Berkshire's annual meeting earlier this month, Abel described the company's position as a "unique opportunity" to build on its businesses and redeploy capital, adding, "We can create long-term value for shareholders." Buffett, now chairman, offered a strong endorsement from the audience, stating, "Greg is doing everything I did and then some."
Despite these assurances, some investors remain cautious. Steve Check of Check Capital Management noted before the meeting that Berkshire is "not overpriced anymore." Lawrence Cunningham, a law and governance professor at the University of Delaware, said "the market is expressing caution." Paul Lountzis of Lountzis Asset Management pointed out the bigger challenge: at a $1 trillion market value, Berkshire is "much harder to grow."
Key Moves and Market Implications
The decision to buy Delta carries significant risk, as airlines are highly sensitive to fuel costs, which have been volatile amid oil price fluctuations. Exiting Visa, Mastercard, and Amazon has sparked debate about whether Abel is merely trimming legacy holdings or signaling a broader strategic shift. Berkshire also increased its stake in Alphabet, a move that aligns with its long-standing preference for companies with strong competitive moats.
Berkshire's balance sheet remains robust. First-quarter operating earnings rose to $11.35 billion from $9.64 billion a year ago, and the company held $373.5 billion in cash, cash equivalents, and U.S. Treasury bills as of the end of March. The company also resumed share buybacks in March after a two-month pause, repurchasing 33 Class A shares and 431,462 Class B shares.
What to Watch on Monday
Investors will be watching for a steady or modestly higher open, with a key resistance level around $489 per Class B share. A break above that could attract buyers, while a fall toward $476 would suggest that the "leadership discount" is still weighing on the stock. The broader market context, including movements in Treasury yields and oil prices, could also influence Berkshire's performance.
Berkshire's insurance operations, particularly Geico, face headwinds as the market "softens," making it harder to price premiums high enough to cover risks. Abel acknowledged this challenge, putting pressure on a business that has long been a key profit driver for the conglomerate.
