Title: After 14 Months on the Sidelines, Will Buffett Resume Berkshire Buybacks?

Berkshire Hathaway has gone 14 months without repurchasing its own shares, but conditions may be aligning for Warren Buffett to restart buybacks. Historically, Buffett has favored buybacks when Berkshire trades below his estimate of intrinsic value and when he struggles to find superior uses for cash. With Berkshire’s cash pile near record highs and deal opportunities scarce in a pricier market, buybacks could again become his most efficient capital allocation lever.

From 2018 to mid-2024, buybacks were a major driver of per-share value growth as Berkshire retired tens of billions in stock at attractive prices. That activity paused after Q2 2024 as the stock re-rated and the valuation premium narrowed the buyback case. Since then, shares have cooled from recent highs, potentially improving the math for repurchases if the discount to intrinsic value has widened.

Two catalysts could nudge Buffett back into action:
– A pullback in Berkshire’s Class A and B shares relative to intrinsic value, particularly if the market remains volatile and credit conditions tighten.
– A continued lack of large, high-return acquisitions at sensible prices, leaving excess cash earning short-term yields rather than compounding in operating businesses.

Key watch items for investors:
– Quarterly filings: Look for changes in share count and cash balances that indicate repurchases.
– Management commentary: Buffett and Greg Abel typically outline buyback philosophy and thresholds in the shareholder letter and at quarterly updates.
– Valuation vs. book and look-through earnings: While Buffett no longer uses a strict price-to-book trigger, a sustained gap between market cap and Berkshire’s normalized earning power tends to precede buyback waves.

Bottom line: If Berkshire’s shares drift below Buffett’s intrinsic value range and deal flow stays thin, a renewed buyback program is plausible. For long-term holders, opportunistic repurchases at rational prices would be a tax-efficient way to boost per-share compounding without relying on an uncertain M&A environment.