Navigating Berkshire Hathaway’s Future: Greg Abel and Buffett’s Legacy
Explore how Greg Abel’s leadership will shape Berkshire Hathaway’s future, the fate of Buffett-favored stocks like Coca-Cola, and what investors can expect from this historic transition.
Key Takeaways
- Warren Buffett’s 5,500,000% return sets a legendary benchmark
- Greg Abel named Berkshire Hathaway’s next CEO, effective end of 2025
- Coca-Cola and American Express remain key holdings but future uncertain
- Berkshire’s management team trained under Buffett, ensuring continuity
- Berkshire Hathaway’s stock has outperformed S&P 500 over decades
Warren Buffett’s announcement to step down as Berkshire Hathaway’s CEO at the end of this year marks the close of an extraordinary chapter in investing history. With a staggering 5,502,284% return delivered to shareholders since 1965, Buffett’s legacy is nothing short of monumental. Enter Greg Abel, a 25-year Berkshire veteran and current head of non-insurance businesses, poised to take the helm. This transition raises questions about the future of Buffett’s favorite stocks like Coca-Cola and American Express, which have been held for decades. In this article, we’ll unpack the leadership shift, examine the fate of iconic holdings, and explore what investors can expect as Berkshire Hathaway embarks on a new era.
Understanding Berkshire’s Legacy
Warren Buffett’s journey with Berkshire Hathaway reads like a financial fairy tale. Taking over a struggling textile company in 1965, he transformed it into a $1.2 trillion conglomerate with a diverse portfolio spanning railroads, insurance, and even ice cream. The numbers tell a story few can match: a jaw-dropping 5,502,284% return to investors as of 2025, dwarfing the S&P 500’s 39,054% over the same period. Imagine turning $1,000 into over $55 million—that’s the power of Buffett’s disciplined approach. But beyond the numbers, Buffett’s knack for spotting ‘wonderful businesses at fair prices’ and holding them for the long haul created a culture of patience and value. This legacy isn’t just about wealth; it’s about a mindset that shaped generations of investors and a company culture that prizes integrity and long-term thinking.
Meet Greg Abel: The New Captain
Greg Abel’s rise to Berkshire Hathaway’s CEO spot is the culmination of a 25-year journey within the conglomerate. Unlike Buffett, who started investing at age 11, Abel’s path began in Edmonton, Alberta, with a bachelor’s degree in accounting and a stint at PricewaterhouseCoopers. His leadership of Berkshire Hathaway Energy since 2009 showcased his ability to manage complex businesses, earning Buffett’s praise as a ‘proud Albertan’ and a ‘brilliant manager.’ Abel’s style is described as ‘more active’ than Buffett’s, focusing on positive engagement with subsidiary managers. His appointment, approved by the board, signals continuity with a twist—he’s expected to bring a hands-on approach while preserving the culture Buffett built. Abel’s quiet confidence and deep understanding of Berkshire’s operations make him a fitting successor to the Oracle of Omaha.
Buffett’s Favorite Stocks: Holding or Selling?
Among Berkshire Hathaway’s roughly 50-stock equity portfolio, a few names stand out as Buffett’s favorites: Coca-Cola, American Express, and Apple. These stocks aren’t just investments; they’re long-term commitments. Coca-Cola and American Express, held since the late 1980s and early 1990s, have delivered steady dividends and global brand strength, contributing over $1 billion annually in dividends alone. Buffett has praised their ‘timeless essentials’ and high profitability. Yet, Berkshire has already trimmed its Apple position by about half, signaling some flexibility. With Buffett stepping down, speculation arises about whether Abel will maintain this loyalty. While the current management team, trained under Buffett, remains intact, Abel hasn’t explicitly committed to holding these stocks forever. For now, their strong performance and Buffett’s endorsement suggest they’re safe bets, but future shifts can’t be ruled out.
Leadership Style: Abel vs. Buffett
When asked about his approach to managing Berkshire’s subsidiaries, Greg Abel described himself as ‘more active, but hopefully in a very positive way.’ Buffett chimed in with a wry ‘better,’ highlighting Abel’s willingness to address issues promptly rather than being ‘lax.’ This suggests a shift toward a more engaged leadership style, potentially accelerating decision-making and operational oversight. Abel’s reputation as a ‘tremendous learning machine,’ praised by Charlie Munger, indicates he’s both a thinker and a doer who can smoothly get things done through others. While Buffett’s investing team, including Todd Combs and Ted Weschler, already make many equity decisions, Abel’s influence on macro strategies and business operations could steer Berkshire’s future in new directions—balancing Buffett’s legacy with fresh perspectives.
What Investors Should Watch
For investors, Berkshire Hathaway’s transition is a moment to watch closely but not panic over. The company reported $9.64 billion in first-quarter operating earnings, down 14% year-over-year, reflecting some challenges in insurance underwriting. Berkshire’s Class B shares have delivered solid returns—26.3% over the past year and 246.1% over the last decade—outperforming many peers. However, Buffett himself noted that as Berkshire grows, moving the needle becomes tougher. Abel’s leadership may bring new strategies, but the core team trained under Buffett remains, suggesting stability. Investors should monitor how Abel handles iconic holdings like Coca-Cola and American Express and whether the equity portfolio sees bolder moves. Staying informed and understanding that even legendary companies evolve will help investors navigate this historic shift with confidence.
Long Story Short
The baton passing from Warren Buffett to Greg Abel is more than a leadership change—it’s the evolution of a financial empire built on decades of disciplined investing and steady growth. Abel’s track record running Berkshire’s non-insurance businesses and his reputation as a ‘more active’ leader suggest a blend of continuity and fresh energy. While Buffett’s cherished stocks like Coca-Cola and American Express continue to perform well, their future under Abel’s stewardship remains open to strategic decisions. For investors, this moment is a reminder that even legendary legacies evolve, and staying informed is key. As Berkshire Hathaway moves forward, the blend of Buffett’s wisdom and Abel’s approach promises to keep this conglomerate a fascinating story to watch—and a portfolio to consider.