Greg Abel's Investment Evolution: Three Strategic Plays Berkshire Hathaway May Pursue Under New Leadership

The era of Warren Buffett’s hands-on stewardship at Berkshire Hathaway has officially concluded. As the legendary investor passed the CEO reins to Greg Abel at year-end, a critical question emerges: how will the investment philosophy of one of the world’s largest conglomerates shift under new direction?

While only time will deliver definitive answers, Abel’s professional background and Berkshire’s current position provide compelling clues about potential strategic moves ahead.

A New Leader with Energy Sector Roots

Greg Abel didn’t arrive at Berkshire’s helm as an outsider to the organization. His decades-long tenure with CalEnergy/MidAmerican Energy—dating back to when Berkshire acquired the utility in 1999—positioned him as the eventual CEO of what evolved into Berkshire Hathaway Energy. This energy sector pedigree distinguishes Abel from his predecessor and could meaningfully reshape investment priorities.

Consider the current landscape: Berkshire Hathaway maintains a massive $382 billion cash reserve, yet compelling investment opportunities remain scarce—a challenge Abel will face as persistently as Buffett did in his final years as CEO.

Occidental Petroleum: Building on Existing Conviction

Occidental Petroleum stands out as a logical candidate for expanded investment. Berkshire already controls 27% of the oil and gas company, yet Buffett consistently resisted the idea of acquiring the remainder. Abel, armed with his energy industry expertise, may harbor different convictions.

With substantial dry powder and limited alternatives, channeling capital into a sector where Abel possesses genuine operational experience makes strategic sense. The position represents both a natural extension of his professional foundation and a practical deployment mechanism for idle cash.

Alphabet: Tilting Toward Technology Growth

Buffett’s well-documented skepticism toward technology equities softened enough to permit a substantial position in Alphabet, Google’s parent company. Berkshire accumulated 17.8 million shares—currently valued above $5 billion—despite this stake representing less than 2% of the portfolio’s total equity value.

Abel may not inherit his predecessor’s inherent wariness of the technology sector. Moreover, Abel appears to favor meaningful positions in quality businesses rather than token holdings. Given Alphabet’s demonstrated resilience, competitive moat, and growth trajectory, this portfolio line item seems ripe for expansion under the new leadership paradigm.

Digital Realty Trust: The Dividend-Yielding Infrastructure Play

Digital Realty Trust represents another intriguing possibility—a holding unlikely under Buffett but increasingly plausible under Abel’s stewardship. This real estate investment trust operates over 300 data centers globally, provisioning cloud computing and artificial intelligence infrastructure to giants including Microsoft, IBM, and Amazon.

Structured as a REIT, the company distributes the majority of quarterly earnings to shareholders via dividends—a characteristic Buffett personally treasured. The current forward dividend yield stands at 3.1%. While distribution growth has plateaued since 2022, declining interest rates combined with anticipated revenue acceleration could reignite dividend expansion in the near term.

The Broader Transition

As Berkshire Hathaway navigates this leadership transition, the investment community watches closely. Abel’s energy background, comfort with technology exposure, and potential appreciation for yield-generating infrastructure investments could collectively forge a notably distinct portfolio trajectory than Buffett’s final years would suggest.