Alphabet Is Berkshire Hathaway’s New Favorite Stock After Buying 48 Million Shares
After three years of selling more than he bought, new Berkshire CEO Greg Abel just broke the streak in dramatic fashion, pouring billions into a single tech giant that Warren Buffett himself quietly identified as the target.
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Cash has been the story at Berkshire Hathaway (NYSE:BRK-A | BRK-A Price Prediction)(NYSE:BRK-B) for three years running. Warren Buffett spent that stretch selling more stock than he bought, quarter after quarter, while the company’s cash and Treasury bill pile swelled toward record territory. Investors got used to reading Berkshire’s 13F filings as a lesson in patience rather than a shopping list.
That changed this quarter. New CEO Greg Abel broke a 14-quarter streak of net selling, and the filing he submitted on Friday shows exactly where he’s putting the money instead. The headline name isn’t a surprise industry pick or a value-stock retread — it’s Alphabet (NASDAQ:GOOG)(NASDAQ:GOOGL), and it was bought in a size that’s hard to ignore.
Berkshire Turns Buyer Again
Berkshire added several positions in the second quarter: 17.5 million shares of Delta Air Lines (NYSE:DAL), 4.3 million shares of Macy’s (NYSE:M), 3.1 million shares of homebuilder Lennar (NYSE:LEN), and 553,000 shares of The New York Times (NYSE:NYT). None of those come close to the main event: Abel bought 24.5 million shares of Alphabet’s Class A stock GOOGL and 23.6 million shares of the Class C stock GOOG — 48.1 million shares combined, worth $37.8 billion at quarter-end.
That single purchase vaulted Alphabet into Berkshire’s third-largest holding, at 10.2% of the portfolio, trailing only Apple (NASDAQ:AAPL) ($70 billion, or 19.5% of the total) and American Express (NYSE:AXP) ($51.9 billion, or 14.5%). Add the $10 billion direct investment Berkshire made in June to help fund Alphabet’s AI infrastructure buildout, and the pattern is unmistakable: Alphabet is Berkshire Hathaway’s favorite stock now.
Buffett’s fingerprints are on this one too. He told CNBC in June that buying Alphabet was his idea, as Berkshire started building the stake back in the third quarter of 2025. Buffett has said he still talks with Abel about where to put Berkshire’s money, even in retirement. Abel, for his part, said in February that he now directs 94% of Berkshire’s equity portfolio, with longtime manager Ted Weschler handling the remaining 6%.
Berkshire also sold stock, closing out the Constellation Brands (NYSE:STZ) position it built 18 months ago and picked up a small stake in homebuilder D.R. Horton (NYSE:DHI), a sector Buffett has drifted in and out of before.
What Buffett — or Abel — Sees in Alphabet
Alphabet checks the boxes Buffett has always wanted: a dominant market position and free cash flow that keeps flowing even when the balance sheet gets messy.
- Google still runs a near-monopoly in search.
- YouTube is the leading streaming video platform on Earth, watched by roughly 90% of global internet users and reaching 2.7 billion monthly users.
- Google Cloud is the third-largest cloud computing business, behind only Amazon‘s (NASDAQ:AMZN) AWS and Microsoft‘s (NASDAQ:MSFT) Azure.
Granted, Alphabet reported negative free cash flow last quarter for the first time as a public company — a real number worth watching — but trailing-12-month free cash flow still came in at $53 billion, and net margins, operating margins, return on equity, and return on invested capital all held up.
That’s the case for buying a stock that, on the surface, looks like the kind of high-flying tech name Buffett has spent decades avoiding. In a market plenty of investors already consider stretched, Abel and Buffett aren’t betting on where Alphabet trades next month. They’re betting on what the business is worth over the next decade. As Buffett has put it for 60 years, “price is what you pay, value is what you get.”
Key Takeaway
One quarter doesn’t erase three years of caution, and Berkshire still has $365.5 billion in cash on hand — plenty of room for another Alphabet-sized bet or a cushion if the market stumbles. That said, the signal matters. Abel has now shown he’ll deploy real capital when he sees real value, and Alphabet’s jump to Berkshire’s third-largest holding is the clearest evidence yet.
For shareholders, the takeaway isn’t to chase Alphabet because Berkshire bought it — it’s to notice that the company known for saying no just said yes, in a big way.
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After two decades of patrolling the dark corners of suburbia as a police officer, Rich Duprey hung up his badge and gun to begin writing full time about stocks and investing. For the past 20 years, he’s been cruising the markets looking for companies to lock up as long-term holdings in a portfolio while writing extensively on the broad sectors of consumer goods, technology, and industrials. Because his experience isn’t from the typical financial analyst track, Rich is able to break down complex topics into understandable and useful action points for the average investor. His writings have appeared on The Motley Fool, InvestorPlace, Yahoo! Finance, Money Morning, and, of course, 24/7 Wall St. He has been featured in both U.S. and international publications, including MarketWatch, Financial Times, Forbes, Fast Company, and USA Today.
