Dear all,
Berkshire Hathaway’s 2nd quarter 2026 earnings came out yesterday, August 8th.
📊 Stock Buybacks 📊
As I anticipated in my preview report three weeks ago, Berkshire’s share repurchases proved to be a big surprise. Moreover, my forecast was not only correct directionally, but also numbers wise, highly accurate!
Print screen from the preview report with the key part:
So, how did Q2 2026 numbers come out?
👉 $4.5 billion worth of buybacks! (in Q1 2026 they were just $226 million)
👉 $7.2 billion when we count July also (hence, one month from Q3 which we will have it confirmed in 3 months time) which is a -0.8% drop in shares outstanding
that was based on various sleek calculations & deductions like I did in the preview
I’ll explain that in more detail in the full Q2 ‘Berkshire Report’ + my take on how likely or not the big buybacks are set to continue, under what conditions etc
Hence, I am confident to say that the analysis was both right and accurate!
Visualising Share Buybacks, Price/Book & Price last 10 years for a sleek overview:
👉 after the big buybacks between 2020 and 2024, we had quite a long ‘dry spell’
👉 yet now with this Q2 buybacks we can say the buyback program has restarted
A complementary visual to see the Share Buybacks and Price/Book levels:
👉 1.5x Price/Book (green) now with a 10-year average of 1.4x (red dotted)
👉 hence, most Q2 buybacks were done at around 1.4x
Enhancing the same key visual with Berkshire stock drawdowns (red below):
👉 Berkshire has no problem buying at P/B. 1.3x, even some at 1.4x like recently
👉 yet way more at 1.0x-1.2x, but for that one needs a big 20-30% stock drawdown —see the 2020 covid, and 2022 bear market via the 3 circles to highlight this key insight!
📊 Buffet’s cash pile or better said, the ‘Berkshire’s STASHaway’ = Optionality! Heads One Wins, Tails One Wins! Keep Compounding For The Win! 📊
“What about that mighty Berkshire cash pile, Mav?” There you go with the breakdown:
👉 Q2 2026: $365,5 billion, to be very exact for what I call the ‘real cash pile’, we extract unsettled T-Bill purchases (771 million + 167 million), hence then 364,5 billion
👉 Q1 2026: $397 billion with the real cash pile $380 billion (as back then they had way more unsettled T-Bill purchases)
👉 Q2 2022, hence 4 years ago the cash position was just or ‘just’ $105 billion
Specifically, the Q2 2026 cash position breakdown from the balance sheet:
👉 +$324 billion = short-term investments in U.S. Treasury Bills (maturities exceeding 3 months and less than 1 year)
👉 +$35 billion = Cash and cash equivalents (demand deposit, money market accounts and investments with maturities of 3 months or less) which is equivalent to Cash and Cash Equivalents and Restricted Cash at the end of the year for the Insurance and other businesses, as well as Restricted cash included in other assets
👉 +$5 billion in the Railroad, Utilities and Energy business
👉 -$771 million and -$167 million as unsettled T-Bill purchases
Q: “Why does Berkshire have a payable for U.S. Treasuries, Mav? They certainly can pay!”
A: Yes, the cay, yet simply they are so active in the Treasuries market — that comes with timing differences from the end of any given quarter to the beginning of the next
📊 Takeaways📊
The full “Berkshire Report” will cover these and way more pillars in way more detail!
Until then, take these 3 home:
Berkshire saw their stock undervalued, hence bought back materially! Recall Greg Abel on share repurchases which is naturally the same approach as Buffett:
“Share repurchases are another important capital allocation option. We will buy back Berkshire shares when they trade below our estimate of intrinsic value, conservatively determined, ensuring that repurchases enhance per-share value for continuing owners.”
If you bought the stock in Q2, you made a very good decision as very likely the stock was undervalued! If you did once I sent you the preview with my forecast 3 weeks ago on the 19th of July, you made +6.29% which will compound beautifully on the long term! There is no need to chase AI, momentum, FOMO, YOLO which is more like playing the thrill of the casino than investing!
Outlook for tomorrow:
I expect the media, pundits and many investors to catch the buybacks story, hence the stock to increase further than the +6.29% from my post (even if it does not, that was still a solid capital deployment). Hence, check tomorrow the ‘News’ and the big ‘Surprise’ which you knew 3 weeks ahead — looking forward for your emails!
Fun notes to wrap it up:
even before AI came to town for everybody, I noticed not many professional investors, bankers (you name it) looking into the fillings, disclosures, not doing the proper digging and the real hard work
how can you easily spot them I asked many years ago a former managers? Just meet them after work and they are fresh, dressed nicely, some even look like they just got out of a spa, ready for drinks, excited for networking and the next ‘opportunity’ — and that after they sat half of the day or more on LinkedIn … work? ‘others should do it!’ kind of mindset … one more thing that is quite for sure is that there are plenty of ‘free rider’s and ‘rent seekers’ out there …
nowadays, with AI even less folks are doing the real hard work — they think doing AI queries do the job, some are impressed how good the AI is — well, ignorance is bliss … for a while …
for me and other people that still do the work, that is actually a GOOD thing, as that is a great way to build an edge, yet truth to be told, it’s not easy at all, it does require a lot of time, patience and diligence
I tried many times various AI/LLM models for research, and they do get better, but they make so many mistakes, even for simple tasks, and sometimes it is even more work to check the AI output — I just don’t like games of ‘Check the Checker, then Check yourself, and then again Check the entire Checks’ (as long as I make less human mistakes than the AI is doing, I am fine with doing the work)
even if AI gets very good, it’ll just become consensus, and most importantly, you can’t buy conviction and patience for investing from a query — meaning, with the first bear market and/or recession, sooner or later one will throw in the towel (and way faster in a prolonged recession, which actually can be an opportunity)!
If you like this differentiated approach and mindset doing independent investment and economic research, then you are in the right place!
Now many of you asked why I do this for free as it requires a lot of time, data costs etc. I really appreciate the question, all good and free for now. One day, I will come up and commit to a premium paywalled offering, one with a clear structure and cadence.
one way to support that and get the highest value, hence cheapest price is by pledging a subscription now — locking in means at least 20% cheaper = you will get the best introductory pricing, it will never be cheaper — actually price will go up in time as the premium research will keep expanding
you will not be charged now, you will be informed ahead when the premium offering will go live, pricing, and what it will contain + you can cancel anytime
thank you for that, appreciate it — I am very glad that you see the value in my work and what I call: “I-RAAS” = Independent Research As A Service!
In case you missed my dedicated post covering in detail why Independent research is valuable and paramount, especially nowadays, there you go:
P.S. once I am done with the Berkshire financials, charts and key insights, I will send you the 2nd edition of the full “The Berkshire Hathaway Report” — planned to be delivered each quarter, and ad-hoc when very important and timely!
✍️ Buffet’s Berkshire: The Legacy Continues! Stash Away Baby! Fundamentals, Buybacks, Optionality, Valuation, and … Patience! ✍️
Research is NOT behind a paywall and NO pesky ads here unlike most other places!
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Just sharing this around with like-minded people, and hitting the 🔄 & ❤️ buttons!
That’ll definitely support bringing in more & more independent investment research!
Like this, the big positive externalities become the name of the game! Thank you!
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Have a great Sunday evening and next week! And never forget, keep compounding: family, friends, community, capital, knowledge, research and mindset!
With respect,
Mav 👋 🤝
“Compound interest is both the ultimate and biggest natural hedge!”
Maverick Equity Research
Amazing Mav!
Thank you for sharing this.
It was a really interesting read. Looking back, it does seem like about a month ago was indeed an attractive entry point.
My own interest in Berkshire right now centers on what they end up doing with the Sirius XM position going forward. The fact that Sirius XM stock has been somewhat in a consolidation/pullback phase over the past month might reflect the market becoming more sensitive to Berkshire's moves (particularly under Greg Abel). I'll be watching closely to see how the position actually changes once the next 13F for Q2 comes out.