Forecast: Greg Abel Takes Helm at Berkshire Hathaway in 100 Days, Ushering in Three Significant Shifts

October 28, 2025 — 06:03 am EDT Authored by Financial Analyst

Key Insights

• Greg Abel is set to assume leadership as Berkshire Hathaway’s CEO when the current year concludes.
• While Abel intends to maintain the core principles established by his predecessors, certain changes are inevitable.
• Anticipate a fresh sector gaining prominence post-transition, and expect some long-standing investments to potentially be phased out over time.

For nearly six decades, Berkshire Hathaway has been synonymous with investment excellence under its current leadership. Although the company hasn’t consistently outperformed the S&P 500 benchmark year-over-year, its cumulative performance has been nothing short of extraordinary. Berkshire’s Class A shares (BRK.A) have delivered an astounding aggregate return, dwarfing the total return of the S&P 500, even when accounting for dividends.

However, as the adage goes, “all things must pass.”

During Berkshire’s annual shareholder gathering earlier this year, it was announced that the current CEO would, with board approval, pass the baton to the designated successor, Greg Abel. As of today, October 28, we are precisely 100 days away from this momentous transition.

Abel has pledged to uphold the investment philosophies that have made Berkshire so successful. This includes maintaining a long-term perspective, engaging in share repurchases when appropriate, and steadfastly adhering to value investing principles.

Nevertheless, change is an inevitable part of any transition.

As we approach this new era for Berkshire Hathaway, three significant shifts are on the horizon.

1. Increased trading activity expected from seasoned investment managers

While the incoming CEO is unlikely to drastically alter the company’s traditionally long-term investment horizon, there’s a strong possibility that Berkshire’s seasoned investment managers will adopt a more active trading approach.

Historically, Berkshire’s portfolio adjustments were often deliberate and substantial. It wasn’t uncommon for positions to be built up or unwound over several quarters. Incremental changes to existing positions were relatively rare.

In recent years, however, Berkshire’s investment team has shown a propensity for more nuanced portfolio management. While the majority of investments are still held for extended periods, gradual adjustments to positions have become more frequent.

Post-transition, investors should anticipate Berkshire’s portfolio updates to reflect a higher volume of transactions than they’ve been accustomed to seeing in the past.

2. Renewed focus on healthcare investments

The second significant change investors can expect is a reinvigorated interest in the healthcare sector.

Traditionally, Berkshire’s largest holdings have been concentrated in the financial and consumer staples sectors, areas where the current leadership has deep expertise. While technology giant Apple has been a notable exception, it was primarily viewed through the lens of a consumer goods provider, valued for its brand loyalty and product ecosystem.

Healthcare has played a relatively minor role in Berkshire’s portfolio for over a decade. However, with the upcoming transition, it’s likely that Abel and the investment team will place greater emphasis on this sector.

The rationale is straightforward: healthcare stocks currently present compelling value. According to recent market data, the healthcare sector’s forward price-to-earnings ratio is significantly lower than the broader S&P 500 average. In fact, only the energy sector boasts a lower forward P/E among major market segments.

Consider, for instance, the pharmaceutical industry. Many established players in this space are trading at substantial discounts to their historical valuations, often coupled with attractive dividend yields. These characteristics align well with Berkshire’s value-oriented investment approach and could lead to increased allocation to the healthcare sector in the post-transition era.

3. Potential reshuffling of core holdings

The third major shift investors should prepare for is the potential divestment of one or more long-standing core holdings.

To be clear, this doesn’t apply to the “permanent” holdings outlined in recent shareholder communications, which include long-term stakes in certain consumer and energy companies, as well as specific international investments. These positions are likely to remain untouched.

However, even Berkshire’s largest holding isn’t immune to reassessment. Despite its strong market position and capable management, concerns about stagnating hardware sales and an elevated valuation multiple could prompt a reevaluation of this investment. Recent portfolio updates have already hinted at a potential reduction in this position, a trend that may accelerate post-transition.

Similarly, certain financial sector holdings that were acquired at significant discounts to book value years ago may no longer present the same compelling value proposition. As these companies now trade at premiums to their book values, they may be candidates for portfolio trimming or exit.

While Berkshire Hathaway is poised to remain a formidable investment entity in the post-transition era, investors should be prepared for a somewhat altered landscape. The upcoming changes, while significant, are part of the natural evolution of any long-standing organization adapting to new leadership and market dynamics.