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Written by Bram Berkowitz for The Motley Fool->
Not only has Berkshire been piling into cash, but it's also generally been a net seller of stocks and hasn't repurchased much of its own stock in recent years.
This, along with other metrics such as the Buffett Indicator, suggests that Buffett and Abel view the market as overvalued.
Recently, however, Abel has made some moves that could suggest a silver lining.
In recent years, it seems like Berkshire Hathaway's (NYSE: BRKA) (NYSE: BRKB) former CEO, Warren Buffett, has been trying to warn investors about the market's high valuation. Buffett and his team have been hoarding cash and have been net sellers of stocks in recent years.
Since being chosen as Buffett's successor, Abel has continued the trend, once again piling into cash and being a net seller of stocks in the first quarter of 2026. Since the start of 2023, Buffett and Abel have sent Wall Street a $636 billion warning. However, there is a silver lining.
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Since 2023, Buffett's warning has been undeniable; he is concerned about the market's elevated valuations. Buffett and Abel have now loaded up on cash. At the end of the first quarter of 2026, Berkshire had roughly $397 billion of cash, cash equivalents, and short-term investments in U.S. Treasury bills.
Furthermore, between the first quarter of 2023 and the first quarter of 2026, Berkshire sold nearly $239 billion in its massive equity portfolio. Berkshire also didn't repurchase any of its own stock between the second quarter of 2024 and the end of 2025, suggesting management believed the stock traded above its intrinsic value. Combine those two dollar figures together, that's a $636 billion warning.
Buffett hasn't necessarily been shy about it. In his final letter to shareholders, Buffett wrote, "Berkshire will never prefer ownership of cash-equivalent assets over the ownership of good businesses, whether controlled or only partially owned."
At Berkshire's recent annual meeting for shareholders, Abel said that while there are great companies in the market that Berkshire would like to own, "the price relative to the opportunity" does not make it worth acquiring them right now.
It shouldn't come as a huge surprise to market watchers. The Buffett Indicator, which Buffett has called the single best metric for tracking the market's valuation in real time, remains at an all-time high.
The Buffett Indicator compares the Wilshire 5000, a benchmark for all U.S. stocks, to U.S. gross domestic product (GDP). Historically, Buffett has considered the market to be significantly overvalued when the indicator is over 120%. The Buffett Indicator is currently near 227%, though investors should note it has not been below 100% since 2013.
For glass-half-full investors, several moves by Abel could suggest he and Berkshire's team see pockets of opportunity in the market.
In the first quarter, Abel broke Berkshire's repurchase drought, buying back over $234 million of Berkshire's stock, mostly Class B shares, at an average price of just under $487 per share.
Also in the quarter, Berkshire sold nearly $24 billion in stocks and purchased nearly $16 billion in equities. While it still represents net sales in the quarter, I view this as a positive indicator when you consider other surrounding factors.
While the $24 billion is not an insignificant amount of stocks to sell, The Wall Street Journal, citing anonymous sources, reported not long ago that Abel had sold the roughly $15 billion in stocks previously managed by one of Buffett's top investing lieutenants, Todd Combs, who recently left the company for a role at JPMorgan Chase. However, we won't know the exact stocks Berkshire sold until it discloses its 13F filing on May 15.
Additionally, the nearly $16 billion of stock purchases in the quarter is a large sum for Berkshire in recent years. The company only purchased roughly $16.5 billion, $9.2 billion, and nearly $17 billion in stocks in 2023, 2024, and 2025, respectively. So Berkshire's first quarter of stock purchases is nearly the same as what it purchased in all of 2023 and 2025.
I would consider all these factors a silver lining when looking back at Berkshire's limited activity since 2023.
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JPMorgan Chase is an advertising partner of Motley Fool Money. Bram Berkowitz has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway and JPMorgan Chase. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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