Warren Buffett's Value Investing Legacy: Enduring Principles in the Post-Buffett Era

The post-Buffett transition has introduced uncertainty, particularly with Berkshire's $381.7 billion cash reserve as of September 2025. Investors are watching closely to see how Abel deploys this capital, as Buffett's reluctance to deploy large sums in recent years has led to speculation about underperformance relative to the S&P 500. Yet, Buffett's emphasis on patience and disciplined investing-hallmarks of his strategy-suggests that short-term volatility may not derail long-term value creation.

Portfolio Composition: Economic Moats and Strategic Flexibility

Berkshire's 2026 portfolio reflects a blend of Buffett's traditional value investing principles and strategic adaptability. The company's largest holdings-Apple, Alphabet, and Amazon-exemplify the concept of economic moats, with durable competitive advantages and predictable cash flows. Apple alone accounts for over 20% of Berkshire's equity portfolio, despite Buffett's gradual reduction of the position due to valuation concerns. This approach aligns with Buffett's preference for businesses with "straightforward balance sheets and strong long-term economics," even as he adapts to a market increasingly dominated by technology.

The portfolio also highlights a shift toward AI-linked companies, with 23% of holdings invested in sectors like cloud computing and artificial intelligence. While this marks a departure from Buffett's historical focus on stable industries, it underscores his ability to identify undervalued opportunities in high-growth areas. Abel, who inherits this portfolio, has emphasized continuity in capital allocation strategies, stating that the company will prioritize "high-quality businesses with durable competitive advantages."

Leadership Transition: Continuity and Challenges

Greg Abel's appointment as CEO has been met with confidence from Buffett, who praised his operational expertise. Abel's leadership style-described as "steady and operationally focused"-mirrors the culture Buffett cultivated over six decades. However, challenges remain. The company's 2% year-over-year revenue growth in key business segments and the absence of significant investment activity have raised questions about its ability to outperform in a rapidly changing market.

Buffett's continued role as chairman provides institutional stability, but Abel must now navigate the complexities of deploying Berkshire's vast cash reserves. The company's reluctance to resume share buybacks since Q2 2024 and its cautious approach to acquisitions reflect a disciplined stance, even as investors await bold moves. Abel's success will hinge on balancing Buffett's legacy with the demands of a post-Buffett era, where market valuations and technological disruption present new challenges.

Conclusion: The Enduring Relevance of Value Investing

Warren Buffett's principles of value investing-focusing on economic moats, low debt, and long-term growth-remain deeply embedded in Berkshire Hathaway's strategy. While the post-Buffett transition introduces uncertainty, the company's portfolio and leadership continuity suggest that these principles will endure. Abel's commitment to preserving Buffett's philosophy, combined with strategic flexibility in sectors like technology, positions Berkshire to navigate the next chapter with the same discipline that defined its past success.

As the market watches for Abel's first major capital moves, one thing is clear: the foundation of value investing, as articulated by Buffett, continues to provide a robust framework for long-term value creation.