Warren Buffett Successor Greg Abel Cut Berkshire's Bank of America Stake by $1.7 Billion. He Added $1.6 Billion of Delta Air Lines.
Warren Buffett Successor Greg Abel Cut Berkshire's Bank of America Stake by $1.7 Billion. He Added $1.6 Billion of Delta Air Lines.
Daniel Sparks, The Motley FoolFri, August 21, 2026 at 9:53 PM UTC
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Key Points -
Berkshire sold about 30.2 million Bank of America shares in the second quarter, cutting the position 5.9%.
Berkshire's Delta stake grew 44% to 57.3 million shares, a position it started building only this year.
Warren Buffett sold all four of Berkshire's airline positions in the spring of 2020, calling the bet a mistake.
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The second-quarter 13F from Berkshire Hathaway(NYSE:BRKA)(NYSE:BRKB) reached the SEC on Aug. 14, and it shows what CEO Greg Abel did with the conglomerate's $299 billion U.S. stock portfolio during his second full quarter running the company. Much of the portfolio sat still: Apple, American Express, and Coca-Cola -- three of the four biggest positions -- didn't move by a share. And the filing's largest addition, about $17 billion of Alphabet, extended a purchase Alphabet had already disclosed back in June.
The new information sat in two smaller lines. Berkshire cut its Bank of America(NYSE:BAC) stake by about 30.2 million shares, a reduction of 5.9% worth about $1.7 billion at quarter-end prices. That was the largest dollar amount Berkshire subtracted from any position.
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And it added about 17.5 million shares of Delta Air Lines(NYSE:DAL), growing that stake 44% to 57.3 million shares, worth about $5.4 billion at the end of June.
A bank out, an airline in. What makes the pairing worth a closer look is the history on each side of it.
Image source: The Motley Fool.
Extending Buffett's selling
The Bank of America sale extends one of Warren Buffett's last big projects as CEO. Berkshire held just over 1.03 billion shares of the bank in the middle of 2024. It has sold in every quarter since, and the position now stands at 483.4 million shares -- down more than half in about two years. This was the eighth consecutive filing to show a smaller Bank of America stake than the one before it.
The quarter had other cuts, too. Berkshire sold more than half of its Capital One position and reduced its Kroger stake by 22%, or 11 million shares. Neither was a continuation of anything. Both stakes had sat unchanged for at least a year before Abel cut them.
I wouldn't call the selling alarming. Bank of America remains one of Berkshire's largest holdings, at about $27.5 billion as of June 30. But a stake that has been cut in half over two years, by two different CEOs, says the company would rather own something else.
Delta is back
The something else, this quarter, included an airline. And that is the surprising part of the filing.
In the spring of 2020, Buffett sold every airline stock Berkshire owned -- positions in Delta, American Airlines, Southwest Airlines, and United Airlines worth north of $4 billion at the time -- and called his valuation of the airlines an "understandable mistake."
"The world has changed for the airlines," he explained at that year's annual meeting.
Berkshire owned no airline stock for almost six years afterward.
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Delta reentered the portfolio in the first quarter of this year, at 39.8 million shares. The second quarter's purchase brings Berkshire to 57.3 million shares, which comes to about 8.8% of the airline (approaching the size of the stake Buffett abandoned). At Delta's current price, the position is worth about $4.7 billion. And the $1.6 billion Berkshire spent growing it, measured at quarter-end prices, nearly matches the $1.7 billion it pulled out of Bank of America.
A cheap airline, if the growth holds
Delta's own results give some clues about why. The airline's June-quarter earnings came to $2.44 per share by generally accepted accounting principles (GAAP), on $19.8 billion of operating revenue. Its adjusted earnings of $1.56 per share were down 26% from a year earlier -- the cost of absorbing the highest quarterly fuel expense in the company's history.
Management still affirmed full-year guidance calling for adjusted earnings between $6.50 and $7.50 per share (about 20% growth at the midpoint) along with free cash flow between $3 billion and $4 billion.
The company also announced a 15% dividend increase, beginning in the September quarter, and kept paying down debt. Adjusted net debt ended June at $13.6 billion.
At about $82 as of this writing, the stock trades at roughly 14 times earnings, and about 12 times the middle of its own guidance range for this year. That looks cheap for a business guiding to 20% earnings growth -- if the growth holds. Airlines are cyclical, fuel is volatile, and Buffett's 2020 exit shows how fast the economics can turn.
As always, the filing shows holdings as of June 30, not when the trades happened, and Berkshire doesn't explain its reasoning. Even so, this quarter's pattern is hard to misread, I'd argue. Abel took money out of a bank position Berkshire has been shrinking for two years and put a nearly identical amount into an airline priced at about 12 times this year's guided earnings, with debt falling and a bigger dividend already being paid. Buffett gave up on this stock. His successor keeps buying it.
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Bank of America is an advertising partner of Motley Fool Money. American Express is an advertising partner of Motley Fool Money. Daniel Sparks and his clients have positions in Apple and Berkshire Hathaway. The Motley Fool has positions in and recommends Alphabet, American Express, Apple, and Berkshire Hathaway. The Motley Fool recommends Capital One Financial, Delta Air Lines, Kroger, and Southwest Airlines. The Motley Fool has a disclosure policy.
Source: “AOL Money”
