Greg Abel Just Plowed $4.2 Billion Into Warren Buffett's All-Time Favorite Stock

Warren Buffett served as chief executive officer of the Berkshire Hathaway (NYSE: BRKA)(NYSE: BRKB) holding company from 1965 to 2025. He turned it into a $1 trillion conglomerate with numerous wholly owned subsidiaries, a $350 billion stock portfolio, and over $300 billion in cash.

That's a tough act to follow for Buffett's chosen successor, Greg Abel, who took the reins at the beginning of 2026. But during the second quarter, ended June 30, he plowed $4.2 billion into Buffett's all-time favorite stock, which should be a very popular move with Berkshire's shareholders. Read on.

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Berkshire produced incredible returns during Buffett's tenure

Buffett acquired a controlling stake in Berkshire Hathaway in 1965, when it was a struggling textiles company. He quickly realized its core business wasn't viable, so he converted it into a holding vehicle for his various investments.

Berkshire has acquired stakes in many different companies since then, targeting those with steady growth, reliable profits, and strong management teams. But above all else, Buffett often favored companies that consistently returned money to shareholders through dividends and stock buybacks, because they compounded Berkshire's returns much faster.

Perhaps one of the best examples is Coca-Cola; Buffett acquired 400 million shares in the beverage giant for $1.3 billion between 1988 and 1994, and Berkshire still holds all of them today. The shares are now worth $34 billion and will pay Berkshire $848 million in dividends during 2026 alone. American Express is another dividend powerhouse Berkshire has owned for decades.

But then there's Apple. Buffett invested a whopping $38 billion in the iPhone maker between 2016 and 2023, and heading into 2024, the position was worth over $170 billion and accounted for half the value of the conglomerate's entire stock portfolio. Berkshire wound up selling around 75% of its Apple stake by the end of 2025 to cash in some of its gains and reduce concentration risk.

Occasionally, Buffett liked to acquire entire companies that Berkshire would manage privately. He bought numerous insurance companies, logistics companies, utilities, and even consumer brands, and they continue to provide a substantial amount of cash flow that funds Berkshire's other investments.

Berkshire stock produced a compound annual return of 19.7% during Buffett's 60-year tenure, crushing the S&P 500, which climbed by 10.5% per year over the same period. In dollar terms, an investment of $1,000 in Berkshire stock in 1965 would have grown to $48.5 million by the end of 2025, whereas the same investment in the S&P 500 would have been worth just $399,702.

Buffett plowed $77.8 billion into Berkshire stock between 2018 and 2024

The $38 billion Berkshire invested in Apple is more money than Buffett ever parked in any other company. However, between 2018 and 2024, he plowed $77.8 billion into another stock you won't see in Berkshire's portfolio -- Berkshire itself!

Toward the end of Buffett's tenure, Berkshire became so large that he struggled to find new investments that could contribute enough growth to actually move the needle. Therefore, he opted to return some of the conglomerate's idle cash to shareholders through stock buybacks instead.

Buffett authorized Berkshire to purchase its own shares on the open market, which shrank the available float and subsequently gave investors a larger slice of the company. Buybacks give shareholders full control over when they realize their gains for tax purposes, whereas alternatives like dividend payments are taxed almost right away.

Greg Abel is picking up where Buffett left off

After authorizing $77.8 billion worth of buybacks between 2018 and 2024, Buffett didn't authorize any during his final year as CEO in 2025. In my opinion, it's probably because he wanted to leave his successor, Abel, with as much cash as possible to take Berkshire into its new era.

Abel is already putting that money to work, investing over $20 billion in Google parent Alphabet since taking over as CEO. But he also restarted the buyback machine almost immediately; during the first quarter of 2026, Abel authorized $235 million worth of buybacks, and in the second quarter, he upped the ante to $4.2 billion.

BRK.A Stock Buybacks (Quarterly) data by YCharts

Berkshire can continue repurchasing its own stock at management's discretion as long as the balance of its cash and cash equivalents remains above $30 billion. Since the conglomerate is sitting on a whopping $365 billion in dry powder now, I think Abel will continue returning money to shareholders for the foreseeable future.

American Express is an advertising partner of Motley Fool Money. Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, American Express, Apple, and Berkshire Hathaway. The Motley Fool has a disclosure policy.