Berkshire Dips as Greg Abel Takes Over
Greg Abel officially took over the CEO position from Warren Buffett on January 1st. Once again, Berkshire’s stock reacted in red. It’s the same pattern we saw early last year when Buffett announced his retirement, back then, the stock also moved downward.
So is this another omen of how the market judges the new guy? Is Berkshire’s future in danger? I wouldn’t read too much into it, but it is at least a sign of caution. Investors don’t know Greg Abel yet. They don’t know his management style and still need to build the kind of trust they had in Buffett - if that’s even possible.
I think the company is very well positioned, with a cash pile of almost $400B and a more balanced portfolio after trimming the Apple position. On top of that, Berkshire has taken a first step into AI territory with the recent Alphabet buy. And honestly, we should listen to Buffett himself when he says that Abel is the best man for the job and will do great. I wouldn’t bet against him.
I’m holding my Berkshire position and adding more via DCA. In my view, this is one of the most proven and robust companies out there. It may not be a rocket like NVIDIA, but I believe it can very well beat the market in the coming years, just as it has in the past.
