The Abel Portfolio

The Setup

On May 15, 2026, Berkshire Hathaway filed its quarterly 13F with the SEC for the period ending March 31. It was the first filing under Greg Abel, who took over as CEO on January 1 after Warren Buffett stepped down from the role he had held for six decades. Buffett remains chairman and, by Abel's own account, the two speak nearly every day. But the portfolio decisions are now Abel's.

The headlines wrote themselves. "Berkshire dumps Amazon." "Abel bets on airlines." "Is Abel the next Buffett?" None of that framing is useful. The filing is not a list of stock tips. It is a document that tells you, in dollars and shares, what the most closely watched investment operation in the world believes about the current state of the economy.

Here are the numbers. Berkshire's equity portfolio shrank from roughly $274 billion to $263 billion. The number of distinct positions dropped from 40 to 26. The top five holdings (Apple, American Express, Coca-Cola, Bank of America, and Chevron) now account for 68% of the portfolio, with Apple alone at 22%. This is the 14th consecutive quarter in which Berkshire was a net seller of equities, with cumulative net sales of roughly $195 billion over that stretch. And at the end of Q1, cash reserves stood at a record $397.4 billion, up 6.5% from December.

The question is not what Abel bought and sold. The question is what the pattern of buys and sells reveals about his view of the economy. And the answer, once you lay the trades side by side, is surprisingly clear.

Selling the Toll Booth, Buying the Highway

The single most revealing contrast in the filing is not any individual position. It is the shape of what was bought against what was sold.

Abel exited Visa ($2.91 billion) and Mastercard ($2.28 billion) entirely. These are two of the highest-quality businesses on the planet. Combined, they process over $20 trillion in annual payment volume. Gross margins above 60%. Capital-light models. Practically no credit risk because they do not lend. Buffett himself called them "toll booths on the global economy." They are, by almost any measure, structurally perfect companies.

Abel sold them anyway.

In the same quarter, he bought $2.65 billion of Delta Air Lines (39.8 million shares), increased the Lennar (LEN) position by 43%, and opened a new position in Macy's (M) at roughly 9x forward earnings. He also nearly tripled the New York Times (NYT) stake.

Notice the rotation. Visa and Mastercard are financial intermediaries. They do not make anything, move anything, or sell anything. They skim a percentage of other people's transactions. That is what makes them great businesses: they sit in the middle of every purchase without bearing the cost of the purchase itself. They are toll booths.

Delta, Lennar, and Macy's are the highway. They move people. They build houses. They sell goods. They employ tens of thousands of workers, carry physical inventory, negotiate fuel contracts, and manage supply chains. They are exposed to the real economy in a way that Visa and Mastercard structurally are not.

So why would one of the sharpest capital allocators in the world sell the toll booth and buy the highway?

One answer: the toll booth is priced for a world where transaction volumes keep compounding at 8-10% annually, and the highway is priced for a world where consumer spending has already peaked. If you believe consumer spending is going to slow (or is already slowing, as the auto loan delinquency data suggests), the toll booth is overpriced because its revenue is a percentage of the volume it processes. Delta at 7x earnings, Lennar at 14x, and Macy's at 9x are priced for bad news that has already been partially absorbed. Visa at 30x and Mastercard at 33x are priced for good news that may not arrive.

Abel did not sell quality. He sold price.

The Chevron Trade

The largest single transaction in the filing, measured by dollar value, was the Chevron reduction. Berkshire sold 45.78 million shares at a volume-weighted average price of roughly $182.59, generating close to $8 billion in proceeds. That was a 35% reduction in the position. Even after the sale, Berkshire still holds approximately $17 billion in Chevron and remains the company's fourth-largest institutional shareholder.

The timing matters. Chevron shares hit an all-time high in March 2026, driven by the Iran conflict and surging oil prices. Brent crude was above $115 per barrel during most of Q1. Chevron is up roughly 29% year to date and 38% over the past twelve months. Abel sold into the spike, at the top, into maximum demand. That is not a bearish call on oil. Berkshire still owns a massive Chevron stake, plus its entire Occidental Petroleum position and Berkshire Hathaway Energy, which is one of the largest utility operators in the country.

What this is, rather, is discipline. Chevron's price was elevated because of a geopolitical event (the Strait of Hormuz disruption) whose permanence is uncertain. The underlying company is the same company it was at $140. The cash flows are better at $182, obviously, but the risk/reward is worse because you are paying a geopolitical premium that could evaporate if a ceasefire or deal materializes. As we wrote in April, geopolitical premiums in oil have a shelf life.

Here is the kicker: the same oil price spike that made Chevron expensive is what made Delta cheap. Fuel is an airline's largest operating cost. When oil surges, airline stocks get sold. Delta was trading at 7x forward earnings when Abel bought it, beaten down precisely because the market was pricing in sustained high fuel costs.

So Abel sold the company benefiting from the oil spike at all-time-high prices, and bought the company suffering from the oil spike at depressed prices. That is textbook countercyclical positioning. Sell the winner at the top. Buy the loser at the bottom. Wait for the reversion.

The Alphabet Exception

If every other buy in the filing is a value play (Delta at 7x, Lennar at 14x, Macy's at 9x), Alphabet looks like the outlier. Abel increased the GOOGL position by 204% (roughly tripling the stake to 54.2 million shares, worth approximately $15.6 billion) and opened a new GOOG position of about 3.6 million shares (roughly $1 billion). At the end of Q1, Alphabet was Berkshire's seventh-largest equity holding.

This is not cheap by any traditional Berkshire metric. Alphabet trades at roughly 20x forward earnings. But the reason it does not break the pattern is that Alphabet is barely a growth stock at this point. It is a $403 billion revenue machine. 32% operating margins. Q1 2026 revenue of $109.9 billion, up 22% year over year. Operating income of $39.7 billion, up 30%. Google Cloud, at over $20 billion in quarterly run-rate revenue, is the fastest-growing major cloud platform.

We made this case in April: Alphabet generates more operating income than Coca-Cola, Nike, McDonald's, and Goldman Sachs earn individually. Waymo has a plausible $100+ billion standalone valuation that is currently embedded in the stock at zero. YouTube is bigger than Netflix. And the AI optionality through Gemini, TPUs, and deep integration across Search and Cloud is not being priced as a separate line of value.

Abel's Alphabet buy is not a growth bet. It is a value buy on a company that Wall Street has miscategorized. The market still treats Alphabet as if it is one bad antitrust ruling away from collapse. The financials say it is a diversified infrastructure company with cash flows that belong in the same conversation as Berkshire's core holdings.

It is worth noting what Abel did not buy: Amazon. Berkshire exited its entire $525 million Amazon position in Q1. Both companies run massive cloud businesses. Both are investing billions in AI. But Amazon trades at a higher multiple, carries a much more capital-intensive logistics operation, and is facing margin pressure from rising fuel costs across its delivery network. Same sector, very different risk profiles at current prices.

$397 Billion in Dry Powder

The headline number in the 13F is not any single stock. It is the cash. Berkshire ended Q1 with $397.4 billion in cash and equivalents, up 6.5% from December 2025. To put that in perspective: the cash pile alone is larger than the entire market capitalization of all but roughly 15 companies in the S&P 500. It is more than the combined market cap of Goldman Sachs and Morgan Stanley. It is Berkshire's largest asset.

There are two ways to read this. The common interpretation is that Berkshire "cannot find anything to buy," and the cash is a drag on returns. That reading is wrong, or at least incomplete.

At the current 30-year Treasury yield of 5.18% (the highest since July 2007), short- and medium-duration Treasuries are paying Berkshire north of $20 billion per year in essentially risk-free income. That is not dead money. That is a bond portfolio generating more annual income than the GDP of Iceland. Abel is not sitting on cash because he has no better ideas. He is sitting on cash because the risk-free rate is high enough to make patience genuinely profitable while waiting for the market to offer something better.

The other way to read the cash is as a position itself. When you hold $397 billion in a market where the S&P 500 recently traded above 7,500 and the Dow crossed 50,000 for the first time, you are making a statement. You are saying that the marginal dollar is better off earning 5% in Treasuries than buying equities at current valuations. That is not a prediction of a crash. It is a statement about expected returns. And when the person making that statement runs a trillion-dollar conglomerate with a 60-year track record of patient capital allocation, it is worth listening to.

Abel also restarted Berkshire's share buyback program in Q1, authorizing $234 million in repurchases at approximately 144% of book value. That is modest by Berkshire standards, but it signals that Abel views Berkshire's own stock as a better use of capital than most of the public equity market right now.

What the Exits Tell You

The buys got the headlines. The sells are the signal. In addition to Visa, Mastercard, and Amazon, Berkshire fully exited UnitedHealth ($1.66 billion), Domino's Pizza ($1.40 billion), Aon ($1.27 billion), Pool Corporation ($702 million), HEICO, Charter Communications, Liberty Formula One, Allegion, Diageo, Liberty Latin America, and Atlanta Braves Holdings. In total, 16 positions were closed, representing approximately $14 billion in liquidations.

Some of these were likely Todd Combs positions inherited from the prior portfolio management structure. Combs departed Berkshire late last year, and Abel's first quarter appears to have included a systematic cleanup of positions that were smaller, less convicted, or no longer aligned with the concentrated portfolio Abel wants to run.

But there is a pattern in the exits that goes beyond housekeeping. Visa, Mastercard, Domino's, Pool Corp, HEICO, Charter, Aon: these are all premium-multiple businesses that were trading at or near historically rich valuations. Visa at 30x earnings. Mastercard at 33x. Domino's at 25x. Pool Corporation at 28x. Every one of them is priced for a world where consumer spending keeps growing, interest rates come down, and the economic expansion continues.

The UnitedHealth exit carries additional context. UNH has been under pressure from a DOJ investigation, executive turnover, and growing political scrutiny of healthcare costs. But it was also Berkshire's first major healthcare exit since the pandemic-era sales. For a conglomerate that has historically favored healthcare moats (Berkshire still owns large stakes in insurers like Chubb), walking away from the largest health insurer in the country sends a signal about either valuation, regulatory risk, or both.

The portfolio that remains is strikingly simple. Apple, the consumer hardware and services giant with massive buybacks and nearly indestructible brand loyalty. American Express, the high-income consumer payments franchise. Coca-Cola, the global consumer staple. Bank of America, the interest-rate- sensitive banking franchise. Chevron, the energy cash-flow machine. Alphabet, the AI infrastructure play. And now Delta, the cyclical value bet. That is a portfolio built for an environment where you want real earnings, real dividends, and real assets, not growth stories that need the market to keep going up in order to work.

What Could Go Wrong

The biggest risk to Abel's macro thesis is that the market keeps running. If the S&P 500 gains another 15% this year (which is within the range of Wall Street consensus targets), the $397 billion in cash earns 5% while equities earn three times that. Berkshire's relative underperformance would widen, and the narrative that Abel is "too cautious" or "not Buffett" would intensify.

The Delta bet is particularly vulnerable. Abel is essentially betting that oil prices will moderate or that Delta's earnings power can absorb sustained $100+ crude. If the Hormuz situation escalates further and Brent stays above $120 for multiple quarters, Delta's margins will compress more than the current valuation implies. Fuel hedging provides a buffer, but not indefinitely.

The Chevron trim could also look premature if oil keeps climbing. Abel sold at $182. Chevron is currently around $170, down from those highs, but if a sustained supply disruption pushes crude to $130+, he left money on the table.

And the broader positioning could simply be early. Being right about valuation and being right about timing are two different things. Berkshire has been a net seller for 14 straight quarters. For much of that period, the market has continued to climb. Being early and being wrong look identical until the cycle turns.

Finally, the concentrated portfolio creates idiosyncratic risk. With Apple at 22% and the top five names at 68%, Berkshire's equity returns are now driven by a very small number of companies. If Apple has a bad year (iPhone demand weakens, services growth slows, tariff risk materializes), the impact on Berkshire is outsized relative to a more diversified portfolio.

The Bottom Line

The financial press wants to make this filing about personality. Is Greg Abel the next Buffett? Will the Oracle of Omaha's legacy survive? That framing is comforting because it reduces a complex capital allocation document to a human interest story.

The data tells a different story. When you sell the toll booths and buy the highways, trim the war premium and buy the war casualty, triple the one tech giant that trades like a value stock, and park $397 billion in cash at a 19-year-high yield, you are not picking stocks. You are making an argument. The argument is that real-economy cash flows are underpriced, digital-economy multiples are stretched, geopolitical premiums are temporary, and the risk-free rate makes patience more profitable than at any point in nearly two decades.

Abel may be wrong about the timing. The market may keep running. But the thesis is internally consistent, backed by specific data at each decision point, and structured around measurable risk and reward rather than narrative momentum. It is the kind of analysis you can agree with or disagree with on the merits, not on the headlines.

That is what data-driven analysis looks like at scale. At Wealth Engine Pro, we approach every company the same way: what do the numbers actually say, and does the price reflect reality or a story? Sometimes the most valuable insight is not which stock to buy. It is understanding the thesis behind someone else's portfolio, testing it against the data, and deciding for yourself whether the argument holds.