Berkshire Trails S&P as Greg Abel Tightens Control

Berkshire Hathaway shares have fallen more than 12% since Warren Buffett confirmed he would step down, leaving the company behind the S&P 500 as the broader market advanced. The S&P recently passed 7,100, while both Berkshire A and B shares have retreated more than 12% from a May 2, 2025 record high. Month-to-date losses for both classes were just under 1% even as the index climbed; Berkshire B shares were 1.8% ahead of the index on one day and 9.7% behind by Friday.

Since taking over operational leadership, CEO Greg Abel has raised the profile of executives who worked with him before, increased his own compensation above Buffett’s level and stated that most additional pay will be used to buy Berkshire stock. He resumed share buybacks that were paused in 2024 and acquired a stake in a Japanese insurance business.

Abel has increased day-to-day involvement in unit operations and implemented more frequent reviews of subsidiaries and portfolio holdings. People familiar with the company describe him pressing for faster accountability when performance falls short, including at senior levels.

He travels regularly from Des Moines to Berkshire’s Omaha headquarters and uses the company NetJets plane to meet managers across several states in a single day. Abel has indicated he will not relocate immediately and plans to remain in Iowa until his son finishes high school.

In a February 28 shareholder letter, Abel reaffirmed core equity holdings including Apple, American Express, Coca-Cola and Moody’s, and disclosed exits from positions overseen by Todd Combs. Combs has moved to a role at JPMorgan Chase and Berkshire does not plan to replace him on its investment team.

Shares have been under pressure since the May 2, 2025 peak. Both A and B classes sit about 3% above early August lows and show less recovery than the broader market. The company’s annual shareholder meeting is scheduled in two weeks.

A second edition of The Complete Financial History of Berkshire Hathaway is due April 28 and will update the firm’s activity through 2024.

In his February 28 letter, Abel wrote: “Warren, Charlie and I, we have some differences, just in style and obviously in how we approach things. Our foundational values continue to be what we build our company through.”