In 2001, Berkshire Hathaway had ~$5.3 billion cash.
In 2026, their cash pile had grown to ~$397 billion.
Then they spent some money. Now, it’s ~$365 billion.
They have that much lying around in cash.
Warren Buffett, who recently retired from his position as CEO of Berkshire Hathaway, is famous for buying good companies’ stocks at “good” prices.
He continues as the chairman of the company while Greg Abel has become the new CEO.
It appears that Berkshire is struggling to invest money.
So much so, their cash pile only keeps growing.
But Warren Buffett is one of the world’s most successful investors. One of the best to have ever lived.
And he is struggling to find stocks to invest in?
Right Price
If you track him closely, for decades now, he has made one thing absolutely clear.
Buying shares of good companies is not going to make you money.
Buying shares of good companies — at the right price — is going to make you money.
The stock markets are driven by supply and demand. Often some of the best companies’ stocks attract a ton of interest and money from investors.
This pushes their stock price up.
Beyond a certain level, it can be considered ‘overvalued’.
The challenge with overpriced stocks is that they can fall to what is considered a fair price.
And if an investor buys at overvalued levels, and the stock price falls to fair levels: the investors make losses.
According to him, stocks can remain overvalued for periods much greater than people realize.
For decades now, he has believed many stocks are overvalued. Which means, he cannot buy them.
This goes far beyond just stock price.
His method is to account for potential future revenues and earnings. And based on that, assess present stock prices. That’s how Warren Buffett and Berkshire Hathaway decide if a stock is worth purchasing.
This sounds simple when written like that. Of course it isn’t.
Stock Universe
25 years ago, the S&P 500 was dominated by a mix of companies — tech, financial, and healthcare mostly.
That has changed in this period. Now, almost all of the biggest companies in the S&P 500 are tech companies.
Warren Buffett used to famously say that he does not understand tech companies.
One crucial factor behind Warren Buffett’s, and therefore Berkshire Hathaway’s success, is that he does not invest in anything he does not understand.
(The S&P 500 is an index made of the 500 biggest companies on the US markets; also many of the biggest companies in the world).
Tech companies were not the biggest 25 years ago, and are now the biggest. This means they grew much faster than other stocks.
And Berkshire Hathaway was not investing in these stocks for a significant period of the last 25 years.
It’s wrong to say he missed out on these. He knew they were hot. But he intentionally stayed away, citing that he did not understand them well enough.
Warren Buffett has been vocal about admiring Jeff Bezos and his company, Amazon. He just never understood it well enough to take a bet on it. Eventually, he did invest in Amazon.
Berkshire did start investing in Apple in 2016. But that was more because he inspected Apple through the lens of a consumer company, not a tech company.
He did make one more attempt before this. He bought IBM in 2011 and sold it off in 2018. The investment was worth about $10 billion. The returns were subpar.
Too Big
Berkshire Hathaway has been a victim of its own success.
Their investments have worked out so well, they’ve become one of the biggest companies in the world.
Their cash pile is one of the biggest in the world.
At that size, there just aren’t enough places you can still invest money in.
This is why we can point out plenty of small companies that have grown spectacularly well. But Berkshire never really talks about them.
They’re growing well, but Berkshire can only invest a small portion of their total cash in them.
Which means, no matter how well those companies’ stocks performed, Berkshire’s overall portfolio would grow by only a tiny fraction.
So smaller companies’ stocks are off-limits.
When The Wallet Is Opened
So, he does not buy overvalued stocks — and he is extremely disciplined about it. He can wait for years and decades. As evident from his cash pile.
He also sticks to stocks that are well within his competence.
Some of his most successful investments have happened in sectors like consumer brands, banking and financial services companies, and utilities and railroads.
So when an investor as accomplished and cautious as Warren Buffett and his Berkshire Hathaway opens their wallet, everyone wants to know what they bought.
Last year they were in the news for what looked like an odd purchase — they had bought $15 billion worth of stocks in Japan total.
The buying started back in 2019.
5 different conglomerate companies based out of Japan but operating practically across the globe. To add to that, they weren’t making one product or operating in one industry.
They were conglomerates — they held stakes in companies that make everything from pens to ships.
So their revenue sources were well-diversified.
The Japanese markets had been underperforming for decades, and global investors tended to not look at Japanese companies with a lot of hope.
According to Warren Buffett, the valuations of these high-quality companies’ stocks were too cheap to ignore.
He still hasn’t stopped.
As of today, he owns roughly 10% of each of the 5 Japanese conglomerate companies.
Newest Purchase
His newest purchase is Google.
(Actually, it’s Alphabet, Google’s parent company.)
Google is spending hundreds of billions of dollars building data centers for the AI race.
And to continue doing so, they need more money.
What used to be a low capital expenditure business (mostly software) is now starting to look more like a high capex business (data center heavy).
Oddly, Berkshire Hathaway, the company that used to shy away from software companies, is now leaning towards them.
Warren Buffett had earlier stated he liked Google’s asset-light structure.
Oddly, Google is starting to look more like a utilities company than a software company with heavy investments in assets (data centers).
Warren Buffett has expressed regret at not buying Google earlier.
He has been buying the stock since the 2nd half of 2025.
The recent news cycle is about Berkshire’s latest investment in Google — a $10 billion investment for fresh issue shares.
Right now, Berkshire holds about $30 billion worth of Google stock.
As of writing this, Google is now the 5th biggest holding of Berkshire Hathaway.
Apple is still its biggest holding — though Berkshire did reduce its stake in the company in 2024-2025.
Apple followed by American Express, Coca-Cola, and Bank of America.
Quick Takes
+ India’s imports of Russian crude oil rose 2.10% month-on-month to 5.50 billion euros in July (vs 4.50 billion euros in June) and hit a record high for the second consecutive month.
+ The government removed physical duty payment challans for exporters to ease compliance burden and save transaction cost, effective on voluntary duty payments from 1 August.
+ The unemployment rate in urban areas was 6.70% (vs 6.60%) and the rural unemployment rate rose to 4.80% from 4.30%.
+ Equity mutual fund inflows fell 15% to Rs 24,697.39 crore in July compared to Rs 28,973 crore in June. Debt funds saw a net inflow of Rs 1.87 lakh crore compared to net outflow of Rs 1.09 lakh crore in June.
+ Nifty 50 and Nifty 50 Equal Weight indices will be reshuffled on 30 September. Wipro will exit the index and the BSE Ltd stock will enter the index.
+ The government approved the RBI’s proposal for introduction of one billion plastic notes of Rs 10 and Rs 20 for field trials. Plastic bank notes are proposed to be issued along with paper notes.
+ The government halved the incentives for electric two wheelers to Rs 2,500 per kWh from Rs 5,000 per kWh. The scheme has been extended by a year to 31 March 2028.
+ India’s retail inflation rose 4.45% in July compared to 4.38% in June. Food inflation rose 5.52% in July (vs 5.32% in June).
+ Net Direct Tax collection rose 23.09% year-on-year to Rs 8.11 lakh crore as of 10 August (compared to Rs 6.59 lakh crore a year ago).
+ SEBI Chairman said that they have observed no market manipulation under the Closing Auction System yet but data is being monitored continuously; as per media reports.
+ India’s merchandise exports rose to $44.24 billion in July compared to $36.98 billion a year ago. Petroleum Products, Electronic Goods, Engineering Goods, Organic & Inorganic Chemicals etc, were the major drivers of merchandise exports.
+ MSCI will add four companies (Adani Energy Solutions, Billionbrains Garage Ventures, Laurus Labs and Lenskart Solutions) to its Global Standard Index and it will remove Astral, Balkrishna Industries and SBI Cards, effective from 1 September.
+ India’s forex reserves rose $14.14 billion to $707 billion for the week ended on 7 August.
+ India’s wholesale price inflation fell to 9.78% year-on-year in July compared to 9.87% in June.
The information contained in this Groww Digest is purely for knowledge. This Groww Digest does not contain any recommendations or advice.
Team Groww Digest