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

Berkshire increased equity purchases by $3.5bn in Q4 2025 while selling $6.6bn, with cash and T-bills totaling ~$373bn (purchases <0.5% of liquid assets). The firm bought stakes in five names (Chubb, Chevron, The New York Times, Domino's Pizza, Lamar), including an >$11bn Chubb position and a nearly 10% Domino's stake accumulated over six quarters after buybacks. Valuation notes: Domino's ~19x earnings, NYT ~30x, Chubb moved from ~10x to ~12x; Chevron is characterized as expensive despite strong Permian/Gulf assets.

Analysis

Berkshire’s modest, targeted purchases function more like signal-spotting than capital allocation — they reveal conviction on idiosyncratic business models rather than a macro call. Domino’s concentration risk (approaching large-holder thresholds) materially compresses free float and increases the probability that future price moves will be amplified by supply/demand imbalance rather than fundamental changes; that dynamic raises illiquidity premia and makes a liquidity-driven rerating more likely than a pure multiple expansion.

Insurance and integrated energy exposures create offsetting portfolio characteristics: P&C insurers benefit from predictable, rising underwriting margins if rate momentum persists, while large integrated E&Ps remain levered to multi-quarter oil realizations and capex cadence. For media and OOH (NYT, LAMR) the common-mode risk is ad-budget cyclicality — a 3–6 month recessionary retrenchment in marketing spend can shave 5–15% off near-term revenues, amplifying downside for the most cyclically exposed names.

Operational second-order effects matter: Domino’s fortressing and proprietary direct-order economics defend margins against third-party delivery fee inflation, but accelerating aggregator penetration would compress franchisee economics before corporate P&L shows signs of stress. On timing, catalytic windows to watch are quarterly same-store-sales prints and the next 13F/13D activity: both can trigger step-function moves in concentrated names within days. Net: where conviction is structural (DPZ), prefer directional with managed liquidity exposure; where exposure is cyclical (NYT, LAMR, CVX), prefer hedged or relative-value structures that monetize temporary dislocations.

Key Decisions for Investors

• Long DPZ LEAP call spread (buy Jan-2028 ATM calls / sell Jan-2028 OTM calls) sized 1–2% NAV — rationale: capture multi-year same-store-sales and margin expansion while capping premium outlay; target 2.5x payoff if SSS growth and carryout mix continue, max loss = premium paid.
• Buy CB equity with a 12-month protective put (buy CB, buy 9–12m put ~10–15% OTM) sized 1–3% NAV — rationale: retain upside to ongoing underwriting tailwinds while limiting a sudden reserve/credit shock; reward: asymmetric exposure to margin normalization, capped downside in a hard-loss scenario.
• CVX tactical collar / covered-call program over 6–12 months (own CVX, sell near-term calls to fund 9–12m OTM puts) — rationale: harvest buyback yield and dividends while protecting vs a >20% oil correction; trade is neutral-to-bullish with explicit downside insurance.
• Event-driven short/put spread on LAMR or NYT (buy 3–9m put spread) — rationale: monetize near-term ad-spend cyclicality risk into the next two quarterly prints; target 20–40% return if ad budgets retract, max loss = premium paid.