Did New Berkshire Hathaway CEO Greg Abel Repeat Past Warren Buffett Mistakes?

Berkshire Hathaway's Q1 13F showed a major portfolio reshuffle under new CEO Greg Abel: the firm fully exited 15 positions, cut nearly all of Constellation Brands, and reduced its holdings to 26 stocks from 39. The biggest purchase was about $10 billion of Alphabet, while new stakes in Delta Air Lines ($2.6 billion) and Macy's ($55 million) drew criticism given Buffett's longstanding concerns about airlines and retail. Abel also tripled Berkshire's stake in The New York Times, but the article frames most of the moves as disappointing outside of Alphabet.

Analysis

The market is likely misreading this filing as a simple style drift when the more important signal is capital allocation optionality. The biggest incrementally bullish read is GOOG: Berkshire is effectively endorsing the AI platform with the cleanest monetization path and the most control over both model and inference economics, which could become a relative multiple anchor if AI capex stays irrational elsewhere. That said, the move also implies Berkshire is willing to tolerate more technology beta, which may narrow the stock’s traditional “low-volatility compounder” discount over time.

The more interesting second-order effect is what the disposals say about private-market substitutes. Exiting AMZN/V/MA removes exposure to toll-collector economics just as consumer payments and e-commerce rails face slower growth, but it also hands that exposure back to passive ownership and other mega-cap allocators. If the filing is signaling a preference for businesses with visible asset backing or platform control, then M and DAL are less about sector conviction than about price dislocations that can mean-revert over 12-24 months—but only if management execution does not deteriorate.

The contrarian read on DAL is that airlines may be entering a better phase for equity holders than Buffett’s historical experience suggests: supply discipline and ancillary revenue can offset some cyclicality, but this only works if fuel remains contained and capacity growth stays rational. Still, the asymmetry is poor versus GOOG, where downside is cushioned by cash generation and upside can re-rate quickly if AI monetization broadens beyond search. The filing is mildly negative for BRK.B near term because it reduces the aura of discipline, but not materially negative for fundamentals unless these bets persist and underperform for several quarters.

From a risk standpoint, the key horizon is 6-18 months: the portfolio changes will matter less if macro softens and more if AI spend and consumer demand diverge. A reversal in GOOG would likely come from evidence that AI usage is cannibalizing high-margin search faster than it expands total ad inventory; a reversal in DAL would come from fuel spikes or recessionary fare pressure. The biggest hidden risk is that these are “portfolio manager” ideas rather than full Berkshire-size convictions, which means investors may overinterpret a signal that is only modestly scalable.

Key Decisions for Investors

• Long GOOG vs short basket of AMZN/V/MA on a 3-6 month horizon; thesis is that capital is rotating toward vertically integrated AI infrastructure while payments/e-commerce toll collectors face slower re-acceleration. Target 10-15% relative outperformance with a stop if GOOG underperforms the basket by 8% on two consecutive earnings prints.
• Initiate a tactical long DAL position for 6-9 months, but only paired with strict risk controls; upside is multiple expansion if capacity discipline persists, while downside is fuel or demand shock. Consider buying calls rather than stock to cap tail risk.
• Avoid chasing BRK.B on this filing alone; wait for one more quarter of post-transition allocation data before assigning a new capital-allocation regime premium. If BRK.B underperforms XLF by >5% over the next quarter, re-evaluate as a re-entry point.
• Fade M as a long-duration value trap unless there is hard evidence of monetizing real estate at the asset level; use any rally above prior resistance as an opportunity to short or hedge. Risk/reward remains unfavorable versus higher-quality consumer names.
• Use NYT only as a low-conviction relative-value long if media multiples compress elsewhere; current valuation leaves limited margin of safety, so prefer it only against weaker ad-dependent media peers.