The Blubber

75% of Warren Buffett’s equity portfolio is in just 5 stocks.

Warren Buffett's Berkshire Hathaway significantly increased its cash reserves by 7% in the last quarter, reaching a staggering $157 billion, surpassing its previous record of $149 billion from late 2021. Notably, the conglomerate's cash pile now exceeds the market capitalization of Disney, valued at $156 billion as of Friday's closing.

Historically, when Berkshire's cash and Treasury bill holdings grow substantially, it suggests that Warren Buffett and his team faced challenges in finding attractive investment opportunities in the stock market or acquisition targets.

Berkshire's third-quarter earnings report, released on Saturday, revealed that Buffett and his colleagues invested just $1.7 billion in stocks during the last quarter, while they sold approximately $7 billion worth of stocks, resulting in a net selling position of $5.3 billion.

Furthermore, they allocated only $1.1 billion for stock buybacks during the period, which is approximately $300 million less than in the second quarter and a fraction of their $4.4 billion buyback expenditure in the first quarter.

The slower pace of buybacks can be attributed, at least in part, to Berkshire's stock price appreciating by roughly 13% in the six months leading up to September. Warren Buffett and his business partner, Charlie Munger, typically repurchase Berkshire Hathaway's stock only when they believe it to be significantly undervalued.