Warren Buffett's Successor, Greg Abel, Now Has $46 Billion of Berkshire Hathaway's Capital Devoted to His Top Investment Idea
Key Points
Berkshire Hathaway's 95-year-old longtime boss retired as CEO on Dec. 31, handing the reins over to Greg Abel.
Abel has overseen a steady build-up of Berkshire's stakes in a half-dozen companies from one international market.
The most influential businesses in this country tend to offer robust capital-return programs and a value proposition that's challenging to find amid a historically expensive U.S. stock market.
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On Dec. 31, 95-year-old billionaire Warren Buffett took off his work coat for the final time as Berkshire Hathaway's (NYSE: BRKA)(NYSE: BRKB) CEO and handed the reins to his successor, Greg Abel. Though he remains chairman of Berkshire's board, the company's day-to-day operations, including the oversight of its $316 billion investment portfolio, fall to Abel.
Buffett's understudy of a quarter-century has vowed to maintain the same strategies and ethos that enabled the Oracle of Omaha and Berkshire's shareholders to prosper. Abel has a long-term focus, is hell-belt on locating value in any market, and is a big believer in concentrating Berkshire's capital into his best investment ideas (just like Warren Buffett).
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Warren Buffett retired as CEO of Berkshire Hathaway on Dec. 31, 2025. Image source: The Motley Fool.
While plenty of attention has rightly been paid to Buffett and Abel collectively green-lighting $78 billion in share buybacks since July 2018, Abel's $46 billion wager on his top investment strategy is, arguably, a bigger deal.
Berkshire Hathaway's new boss sees value in Japan
Although Warren Buffett repeatedly told investors not to bet against America during his lengthy tenure as Berkshire's CEO, Abel's top investment ideas hail from a different country altogether: Japan.
Beginning in the summer of 2019, Buffett and Abel began building up Berkshire Hathaway's stakes in Japan's five mammoth trading houses, commonly known as the "sogo shosha." Including purchases green-lit by Abel following Buffett's retirement as CEO, Berkshire's stakes in the sogo shosha (as of April 5, 2026) have grown to:
- Mitsubishi (OTC: MTSUY)(OTC: MSBHF): $13.27 billion
- Mitsui (OTC: MITSY)(OTC: MITSF): $11.69 billion
- Itochu (OTC: ITOCY)(OTC: ITOCF): $8.62 billion
- Marubeni: (OTC: MARUY)(OTC: MARUF) $5.74 billion
- Sumitomo (OTC: SSUMY)(OTC: SSUMF): $4.23 billion
Additionally, in March, Berkshire (via National Indemnity) took a $1.8 billion position in Japanese insurer Tokio Marine (OTC: TKOMY) -- a position now worth about $2.2 billion.
Collectively, Abel has approximately $46 billion of Berkshire's $316 billion investment portfolio allocated to some of Japan's most influential businesses.
Image source: Getty Images.
Japanese stocks share three traits that Greg Abel (and Berkshire's retired CEO) values
Devoting close to 15% of Berkshire Hathaway's invested assets to Japan is a big deal. But the "why?" behind these investments makes sense if you go down the checklist of what Abel is looking for in a long-term investment.
The sogo shosha and Tokio Marine share three traits that Abel and Berkshire's now-retired boss absolutely love.
Firstly, many of Japan's largest public companies have robust capital-return programs that put the interests of shareholders first. Share buybacks and dividends incentivize long-term stock ownership, thereby minimizing share price fluctuations. Buffett has always been a big believer in repurchasing Berkshire Hathaway's stock when it made financial sense to do so.
Secondly, the management teams of the sogo shosha receive modest compensation, which is in direct contrast to some U.S. businesses where executives are arguably paid more than their fair share. Reasonable executive compensation ensures that shareholder interests come first.
Third, and most importantly, Japanese stocks offer a value proposition that's almost impossible to find in the U.S. at the moment. The U.S. stock market entered the year at its second-priciest valuation over the last 155 years. Meanwhile, Mitsubishi, Mitsui, Itochu, Marubeni, Sumitomo, and Tokio Marine have historically traded at high single-digit to low double-digit price-to-earnings ratios.
Getting a good deal is of the utmost importance to Abel.
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Sean Williams has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy.
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