Meet the Stock Billionaire Warren Buffett Has Bought for 5 Consecutive Quarters (No, It's Not Shares of Berkshire Hathaway)

Warren Buffett will retire as Berkshire Hathaway CEO at the end of 2025, handing a roughly $300 billion investment portfolio to Greg Abel; Berkshire has delivered a cumulative >6,086,000% gain in Class A shares since Buffett became CEO. Over the last 12 quarters (Oct. 1, 2022 – Sept. 30, 2025) Berkshire has been a net seller of equities, selling about $184 billion more than it purchased and accruing a cash/Treasury pile near $382 billion, while pausing repurchases of its own stock since June 2024. The sole equity Berkshire bought in each of the past five quarters was Domino's Pizza (Q3 2024: 1,277,256; Q4 2024: 1,104,744; Q1 2025: 238,613; Q2 2025: 13,255; Q3 2025: 348,077 — 2,981,945 shares held), with DPZ trading at ~20x forward earnings (about 25% below its five‑year forward P/E) and supporting buybacks plus 13 consecutive years of dividend base increases. Market valuation metrics remain elevated (Buffett indicator ~225%), suggesting caution despite selective buys into quality capital-returning names like Domino's.

Analysis

Market structure: Winners will be high‑free‑cash‑flow, dividend‑and‑buyback‑centric consumer names (Domino’s‑like profiles), select bond proxies and short‑duration Treasuries as marginal equity sellers redeploy into fixed income. Losers: crowded growth and index‑heavy large caps that face incremental supply and transient multiple compression. Cross‑asset: expect rotation into short‑duration Treasuries and cash ETFs (downward pressure on front‑end yields relative to long end), modest USD bid and localized spikes in equity implied vol for heavily sold names.

Risk assessment: Tail risks include forced or accelerated disposition of illiquid stakes, governance missteps under new executive control, or a macro shock that forces liquidation—each could create 10–30% drawdowns in affected holdings. Immediate (days) risk is volatility around public communications; short (weeks/months) risk is rebalancing-driven flow; long (quarters/years) risk is sustained change to capital allocation priorities. Hidden dependencies: insurance float economics, tax lot realizations, and repurchase policy reversal can amplify either stability or disorder.

Trade implications: Favor concentrated long exposure to quality cash‑returners and hedge broad beta: establish a 2–3% position in DPZ over 2–4 weeks (12–18 month horizon) while parking 3–6% of portfolio in short‑duration Treasury ETF (BIL/SHV) to capture carry and optionality. Implement a pair trade: long DPZ vs short XLY (1:1 notional) for 3–9 months to isolate pizza‑specific fundamentals; sell cash‑secured DPZ puts 6 months out at ~10–15% OTM to harvest premium and set acquisition price. Reduce cyclicals exposure by 2–4% and increase allocation to dividend growers by a similar amount.

Contrarian angles: Consensus underestimates the probability management will preserve disciplined allocation, not wholesale sell; that implies BRK volatility is a buying opportunity on 5–10% dislocations—consider a 0.5–1% tactical long BRK.B on such pullbacks. Historical transitions show short‑term angst followed by mean reversion; unintended consequence: activist activity could accelerate value realization, creating asymmetric picks in divestitures and take‑private targets over 6–24 months.

Key Decisions for Investors

• Establish a 2–3% long position in Domino’s Pizza (DPZ) over the next 2–4 weeks, target 12–18 months, take profits at +30% or exit if forward P/E expands above ~26x or same‑store sales growth falls below 3% YoY.
• Allocate 3–6% of portfolio to short‑duration Treasury ETFs (BIL or SHV) within 1 week to capture carry and optionality while leadership/fund allocation uncertainty resolves; reallocate to equities if 3‑month T‑bill yield drops >75bps from entry.
• Put on a pair trade: long DPZ vs short XLY (equal notional) sized for 3–9 months to isolate company‑level upside; size at 1–2% net long exposure and rebalance monthly.
• Sell cash‑secured DPZ puts 6 months out at ~10–15% OTM to collect premium and set an attractive entry price; if assigned, convert to a 2–3% long position and hedge with covered calls.
• Prepare a 0.5–1% tactical long in BRK.B to deploy on a 5–10% headline‑driven pullback within the next 3 months, with a 12–24 month hold and stop‑loss at 12% below entry.