(This is an issue of the newsletter "Warren Buffett Watch", focusing on news and analysis about Warren Buffett and Berkshire Hathaway. You can subscribe every Friday evening to receive this email.)

Berkshire Hathaway's stock price closed on Friday at its highest level since Warren Buffett told shareholders at the annual meeting in May 2025 that he planned to step down from his position by the end of that year.

Just one day before the announcement of that “accidental” news on Saturday, both Class A and Class B shares of Berkshire Hathaway closed at record highs.

In the next three months, the value of both types of stocks fell by more than 14%, and investors are concerned that the so-called "Buffett premium" is fading away.

It has been over a year since the low point following the August 2025 shareholders' meeting, and Berkshire's rebound has not been a straight upward trend. However, on Friday, BRK.A closed at $798,000, which is only 1.4% lower than its historical high of $809,350.

Class B shares closed at $532.02, which is also 1.4% lower than their historical high of $539.80.

The decline on Thursday brought an end to a streak of 10 consecutive trading days of gains, during which Berkshire Hathaway's stock price rose by 5% in total. However, on Friday, the stock rebounded by more than 1%.

CNBC Pro believes that investors might welcome Berkshire Hathaway's use of its substantial cash reserves under the leadership of the new CEO Greg Abel: in the second quarter, it repurchased $4.5 billion worth of shares and invested in Alphabet, Taylor Morrison Home, Lennar (although no further purchases of this stock have been made since October 2nd), as well as the current Bending Spoons. (This will be further explained below.)

CNBC Pro also pointed out that Keefe, Bruyette & Woods analysts Meyer Shields believe that higher short-term interest rates are helping to boost stock prices.

Berkshire currently still holds approximately $360 billion in cash, which "well reflects the continued patience since the new CEO took office," and higher interest rates mean that this cash "can earn more money."

In addition, Berkshire Hathaway's insurance business has also benefited from a calm hurricane season to date.

Rising oil prices are beneficial to its holdings of $19 billion in Chevron shares. Chevron closed at a record high on Friday, with a cumulative increase of nearly 36% since early July. Berkshire Hathaway's energy-related subsidiaries have also benefited from this.

Recently, as investors have shifted from the soaring AI and tech stocks to "old economy" companies, Berkshire Hathaway may also benefit from this trend.

For example, Coca-Cola – a company that Buffett has long favored, and which is now also part of Berkshire Hathaway’s $37.6 billion position – also closed at a record high on Friday, perhaps thanks to KFC’s shift from Pepsi to Coca-Cola. The stock has risen by 34% this year.

Berkshire's position in Alphabet has increased by $2.4 billion since last Friday, surpassing Alphabet to become the third-largest holding in its portfolio. (For the complete top ten holdings, see below.)

On June 1st of this year, Berkshire Class B shares lagged behind the S&P 500 index by 17.5 percentage points, but they have now closed nearly two-thirds of that gap.

So far this year, this stock has lagged behind the benchmark index by 6.0 percentage points.

Making an unusual bet on an “highly popular” Italian technology company has seemingly been a great success so far.

Berkshire's unexpected bet of nearly $1 billion on Bending Spoons has already yielded considerable returns, at least in the short term.

This Italian company began trading on NASDAQ in the United States in July of this year. It acquired abandoned internet brands such as AOL, Evernote, and Vimeo. By utilizing AI, it was able to cut costs, and then used the savings to make more acquisitions.

In late July this year, CNBC Pro stated, "Wall Street is in hot discussion," and mentioned that "analysts... believe there is significant room for upward movement in the future."

This tech stock is clearly not a typical value investment target for Berkshire; its price-earnings ratio is much higher than its level of profitability.

However, before the opening of U.S. stocks on Wednesday, a press release from Bending Spoons disclosed that Berkshire would subscribe for 10 million newly issued shares at $33 per share through a private placement, making an additional investment of $330 million in the company.

This price is nearly 12% lower than the closing price of $37.86 on Tuesday. After the announcement of the news, the stock price of Bending Spoons further rose.

The stock reached a high of $58.56 during the session, and then closed at $53.46 on Wednesday, representing a gain of 41%.

In the three trading days following the disclosure of the news, the stock price of Bending Spoons rose by 24.3%; however, it gave back some of that gain during the sell-off of tech stocks on Friday, closing at $47.07.

This is still 42.6% higher than Berkshire's purchase price of $33, resulting in a profit of nearly $141 million on paper.

But what exactly does “further” mean in the statement of Bending Spoons?

This press release also revealed for the first time that Berkshire had invested $600 million in the company more than three months ago, when it was IPO.

The press release did not specify how many shares Berkshire purchased in July, and Bending Spoons has not confirmed my calculations either, but if we calculate based on the issue price of $29 per share as stated by IPO, the initial subscription would correspond to approximately 20.7 million shares.

As a result, Berkshire currently holds nearly 30.7 million shares, valued at over $1.4 billion based on the closing price on Friday; compared to a total investment of $930 million, the overall book profit is 55.3%.

The press release with Bending Spoons also stated that this "new investment has brought Berkshire Hathaway's shareholding to 4%."

In the email they sent to me, the company stated that they did not “specifically disclose” the current number of outstanding shares. “However, in the second quarter, we had 635 million fully diluted weighted average outstanding shares. IPO issued 34 million shares, and this transaction will also result in an additional 10 million shares being issued.”

Based on these calculations, Berkshire Hathaway's estimated holding of 30.7 million shares is equivalent to 4.5% of the total shares, which is also the ratio I currently use in my Berkshire Hathaway investment portfolio tracker.

We may get a further understanding of exactly how many shares it has purchased in IPO next month, when Berkshire Hathaway discloses its portfolio snapshot as of September 30.

Another unknown is: who within Berkshire Hathaway made the decision to buy Bending Spoons.

Bending Spoons CEO and Co-Founder Luca Ferrari stated in a press release that he shares the same positive view of Berkshire's investments as Wall Street, calling this Omaha-based company "one of the world's finest and most respected capital allocators and a long-term source of inspiration for Bending Spoons."

Morning Star’s Greggory Warren (who served as one of the designated question analysts at Berkshire Hathaway’s annual meetings from 2014 to 2019) wrote that this Bending Spoons transaction, combined with the $36 billion worth of Alphabet shares that Berkshire currently holds, indicates that “the company has finally begun to step out of its comfort zone and look for places to invest capital, which should be seen as a positive sign for long-term investors.”

Barron's Weekly states: "Many Berkshire Hathaway holders hope that the company would invest more actively in stocks with over $350 billion in cash on hand, but considering the high valuation of Bending Spoons, this investment is still surprising."

Content about Buffett and Berkshire on the Internet

Some links may require a subscription:

• Bloomberg via Yahoo Finance: Since joining, JPMorgan's Combs has led expenditures of $5 billion

CNBC A Selection from Warren Buffett's Profile

"I'm a quarter of Coca-Cola" (2015)

Warren Buffett defends Coca-Cola in response to concerns about the health risks of sugary drinks. Coca-Cola is an important and long-held asset of Berkshire.

Warren Buffett: Yes — people have been drinking Coca-Cola since 1886, so I think...

I don’t know if anyone has conducted research comparing the lifespans of people who drink Coca-Cola regularly in large quantities with those who only drink water.

But as for me personally, I am 84 years old. In the past 30 years, a quarter of all the calories I consumed came from Coca-Cola. I can’t see anyone who feels better than I do.

I'm a quarter of Coca-Cola, and I can tell you that since I underwent radiation therapy for prostate cancer three years ago, I haven't missed a single day of work. I don't think prostate cancer is (laughing) caused by Coca-Cola.

And —— all my friends drink it like they’re crazy.

Today, 1.9 billion 8-ounce bottles of Coca-Cola products are sold globally, and that number will exceed 1.9 billion next year. It will be even more in five years, and even more in ten years.

That's always been the case. Some people prefer other things—if they like broccoli and Brussels sprouts, then good for them, but don't invite me to dinner because of that. (Laughter)

Berkshire Hathaway Stock Observation

Surrounding

Twelve months

BRK.A Stock Price: $798,000.00

BRK.B Stock Price: $532.02

BRK.B Price-Earnings Ratio ( TTM ): 13.38

Berkshire's market value: $1,138,885,966,355

As of June 30, Berkshire Hathaway's cash balance: $365.5 billion (a decrease of 8.0% from March 31).

After excluding railway cash and deducting treasury bonds payable: $359.2 billion (a decrease of 3.8% compared to March 31)

Berkshire repurchased $4.5 billion in shares in the second quarter of 2026.

Berkshire's Top Ten Stock Holdings - October 16, 2026

Berkshire's listed stock holdings disclosed in the United States and Japan, sorted by market value, based on the latest closing prices.

Position data as of June 30, 2026, from Berkshire Hathaway's 13F filing submitted on August 14, 2026, except for the following situations:

• Mitsubishi's data as of April 30, 2026

The complete portfolio list and current market value can be viewed in the Berkshire Hathaway Portfolio Tracker at CNBC.com.

Questions or comments

If you have any questions or comments regarding this newsletter, please send them to alex.crippen @ cnbc.com. (Sorry, we will not forward your questions or comments to Warren Buffett himself.)

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In addition, it is highly recommended to read Warren Buffett's annual letter to shareholders, and a summary of the content can be found on Berkshire Hathaway's website.

—— Alex Crippen, Editor of Warren Buffett Watch