Warren Buffett Spent $3.5 Billion on 5 Stocks in His Last Quarter as Berkshire Hathaway CEO. Here's the Best of the Bunch.

Buffett's team purchased $3.5B of equities in Q4 2025 while selling $6.6B, versus $373B in cash and T-bills on the balance sheet. The five buys were Chubb (existing stake now worth >$11B), Chevron, The New York Times (new position, trading ~30x earnings), Domino's Pizza (now ~10% ownership after buybacks, trading ~19x and reporting 3.7% U.S. same-store sales growth), and Lamar Advertising; Chubb's valuation has moved from ~10x to >12x. Purchases are small relative to Berkshire's liquidity but signal targeted conviction—particularly in Domino's—while Chevron exposure and media/consumer trends are highlighted.

Analysis

Buffett’s latest nibble pattern is revealing more about constraints and signaling than conviction size: repeated buys into Domino’s over six quarters have logically migrated Berkshire toward a stake where marginal purchases are administratively costly, effectively creating a natural buyback-like cap on future buying. That dynamic magnifies the earnings-leverage from Domino’s share repurchases and fortressing strategy — every point of same-store-sales outperformance now accrues to a shrinking public float, amplifying EPS growth for remaining holders even if unit expansion slows.

Second-order winners include franchisees and scale suppliers: tighter regional density lowers delivery miles per order and reduces per-order variable cost (fuel, driver hours), while large suppliers (cheese/flour/packaging co-packers) gain higher order visibility and negotiating leverage versus independents. Conversely, independent chains and delivery-focused aggregators face pressure — Domino’s preferential direct-order promotions and negotiated app economics can compress third-party delivery margins and force fee/marketing concessions that hit smaller chains more acutely.

Key risks are near-term commodity/labor inflation and disclosure-driven constraints. A spike in cheese/wheat or a labor squeeze could compress operating margins quickly (3-6 months) and trigger multiple compression given current valuation; on the other side, a continued shift from third-party to direct orders or an aggressive repurchase cadence could drive outsized returns over 12–24 months. Watch regulatory/filing thresholds and repurchase cadence as catalysts — Berkshire’s path to incremental ownership is now as much procedural as it is price-driven.

Key Decisions for Investors

• Long DPZ (12–18 months): Buy shares or buy 12–18 month at-the-money LEAP calls (~1:4 delta exposure) sized to 2–3% of portfolio. R/R: target +30–50% if same-store sales stay +2–4% and buybacks continue; downside capped by a 20% stop or buy protective puts to limit drawdown.
• Pair trade (6–12 months): Long DPZ / Short PZZA equal notional to express a quality spread. Thesis: fortress/scale and direct-order mix outperform Papa John’s digital/marketing-dependent model. Target spread tightening worth ~20–30%; cut if DPZ underperforms by 15%.
• Long CB (Chubb) (9–18 months): Buy CB shares sized to 1–2% of portfolio to play underwriting margin normalization and reserve discipline. Hedge tail risk with 9–12 month puts (small notional). R/R: assume 15–25% upside from multiple expansion; catastrophe episode could inflict 20–30% drawdown short-term.
• Avoid/trim CVX and rotate to higher-beta Permian E&P exposure (months horizon): Reduce CVX exposure on valuation relative to demonstrated Permian FCF upside. If unwilling to pick smaller E&Ps, sell short-dated CVX calls into oil rallies to harvest theta; target to free capital for DPZ/CB where active alpha is clearer.