Berkshire buybacks have returned, but narrow discount could limit impact
CNBC • • technology
Key Points:
- Berkshire Hathaway resumed stock buybacks on March 4 for the first time since May 2024, repurchasing shares worth about $226 million.
- UBS estimates the shares were trading at a roughly 5% discount to intrinsic value, narrower than the 15% discount during the previous buyback program, potentially limiting the scale of repurchases.
- Analysts suggest the limited buybacks may reduce near-term catalysts for the stock, which has remained flat since the repurchases began and is down 4% year to date amid mixed earnings signals.
- New CEO Greg Abel, in consultation with Warren Buffett, decided to highlight the buybacks following the recent leadership transition, emphasizing valuation and timing considerations.
- Berkshire Hathaway's market value stood at approximately $1.04 trillion as of late trading on the Friday before the announcement.
