Greg Abel's Berkshire Hathaway May Have Repurchased Up to $11 Billion of Its Own Stock Last Quarter. Is This a Bullish Signal for Shareholders?
Berkshire Hathaway's massive share repurchase could be Greg Abel's clearest signal yet that the company's own stock is its best investment today.
Overview
CEO Greg Abel may have directed Berkshire Hathaway (NYSE: BRKB) to repurchase up to $11 billion of its own stock in a single quarter, according to a recent report from Barrons. It's hard not to read such an action as a strong vote of confidence in the company's future.
With Berkshire, buybacks are less about sending a "bullish" signal and more about quietly conveying something about intrinsic value and capital discipline to shareholders. Under both Warren Buffett and now Abel, Berkshire's own guidance on repurchases has been simple: The company will buy back shares only when management believes the stock price sits below a conservative estimate of intrinsic value and when Berkshire still maintains ample liquidity for big opportunities and insurance obligations.
Details
That's not the playbook of a management team trying to engineer a short‑term pop.
Source
Originally published at www.fool.com.