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Berkshire's biggest stock purchase under CEO Greg Abel started as Warren Buffett's idea.
Asked on CNBC July 15 who initiated the Alphabet Inc. position, Buffett said: "I initiated it." Abel approved the $10 billion Alphabet private placement on June 1. Abel's own signature is on one housing decision. A second came on his watch.
Taylor Morrison, the sixth-largest U.S. homebuilder, was his first acquisition. $6.8 billion in cash, a 24% premium to the prior close, closed July 24.
Lennar is harder. Abel wrote in February that Berkshire's balance sheet lets it "invest when others are tentative or fearful." In June Lennar guided about 16% gross margin; on September 16 it reported 15.8%, net earnings down 52%. The stake, opened under Buffett in 2025, had tripled before the report. Berkshire crossed 10% September 17 and bought on 11 of the next 12 trading days, about $595 million. The Form 4s put its average prices from $74.49 to $81.96. It does not say who places the orders. By October 2 it held 28.4 million Class A shares.
I read the orders as Berkshire under Abel acting on his other sentence, "We don't envision a quick recovery there." It kept buying a decline he had already called slow. Under Buffett, a D.R. Horton stake bought in 2023 was gone by year-end. If the Form 4s stop before Lennar reports in December, I had it wrong.
At Eagle Talon we score an incoming CEO on three dimensions.
1. Authority. Abel's, with Buffett a director holding 30.2% of the vote and Howard Buffett in the chair.
2. Record. Ten years running Berkshire Hathaway Energy, eight over the non-insurance businesses. Public equities: unproven.
3. Fit. HomeServices of America sat inside the energy company he ran; Clayton Homes sits in the operations he oversaw.
Lennar has guided its fiscal fourth quarter to a 15.5% to 16% gross margin. If it lands there and the Form 4s keep coming, is that discipline under Abel, or Berkshire buying what he already knows?
