Key Points
- Warren Buffett's track record with Berkshire Hathaway boasts a staggering 6,000,000% return on Class A shares since the mid-1960s, making him a Wall Street icon.
- Despite being a net seller of stocks for 10 consecutive quarters, Buffett has consistently repurchased shares of Berkshire Hathaway, his favorite stock, spending nearly $78 billion since mid-2018.
- A recent 10% correction in Berkshire Hathaway's stock price may not be sufficient to prompt Buffett to buy more, as the price-to-book value remains too high at a 60-80% premium.
- Buffett's reluctance to repurchase shares in the last three quarters reflects his strict adherence to buying only at what he considers a fair price, even for his own company.
Summary
Warren Buffett, the Oracle of Omaha, has captivated Wall Street with a phenomenal 6,000,000% return on Berkshire Hathaway's Class A shares since the mid-1960s, far outpacing the S&P 500. Despite his legendary status, Buffett has been a net seller of stocks for 10 consecutive quarters, totaling $174.4 billion in net sales through March 2025. However, since July 2018, he has invested nearly $78 billion in repurchasing Berkshire Hathaway shares, his favorite stock, following a board amendment allowing buybacks with greater flexibility. Recently, Berkshire's stock entered correction territory with a 10.4% drop from its all-time high, yet Buffett has not resumed buybacks, having paused for three quarters. This hesitation stems from the stock's price-to-book value, which remains at a 60-80% premium, above Buffett's threshold for a fair deal. His disciplined approach to value investing, even with his own company, underscores his reluctance to chase overvalued stocks. Meanwhile, Buffett's portfolio adjustments include smaller buys like Domino's Pizza, reflecting his preference for trusted, growth-oriented brands. With a record $347.7 billion in cash reserves, the question remains whether a deeper correction will entice Buffett to repurchase more of Berkshire Hathaway, or if his strict valuation principles will continue to hold firm.