Berkshire Hathaway added Alphabet, the Google parent, to its portfolio for the first time.
Warren Buffett is known as one of the greatest value investors of all time. One of his mantras is to buy stocks in “wonderful” companies at fair prices. Over the years, Buffett has found wonderful companies at fair prices in a variety of industries, but most of them tend to come from the financial sectors, banks, consumer stocks, and energy.
However, by his own admission, Buffett has never been very confident investing in technology stocks. He said they were generally out of his “circle of competence,” and that he didn’t understand them or their durable advantages.
That changed somewhat in 2016 when he bought Apple stock and made it the largest holding in the Berkshire Hathaway portfolio – which it still is. But when he bought Apple, it was cheap, trading at around 10 to 14 times earnings in Q1 2016, so it fit into his value profile. He hasn’t really added many other technology names since.
But that changed in a big way in the third quarter of 2025 when Buffett and Berkshire Hathaway took a big stake in Alphabet (NASDAQ:GOOG), the parent company of Google.
Berkshire Hathaway adds Alphabet for the first time
The big new add in Q3 for Buffet was Alphabet, as Berkshire added 17.8 million shares of Alphabet for a $4.3 billion investment, according the Q3 13F. That makes up about 1.6% of the $267 billion portfolio.
The 13F is the official filing that details what moves a company made in its portfolio every quarter. It is always a big deal for Berkshire Hathaway because of the sheer size of the portfolio and because of who runs it. For years, investors have watched the moves that Buffett has made to inform their own moves on stocks.
The Alphabet investment moved markets, as Alphabet stock surged some 5% on Monday, the first full trading day after Berkshire’s Q3 13F came out last Friday.
Alphabet somewhat fits the profile of a Buffett stock in that it is cheap, at least for an AI stock that is one of the Magnificent 7.
At the start of the third quarter, Alphabet’s P/E ratio dipped below 20 to around 19 – which is downright cheap for a stock with Alphabet’s earnings potential and market leadership. The P/E ratio has since risen to its current 27, but one would assume Buffett bought it early in Q3 when the P/E ratio was lower. Since the beginning of Q3, Alphabet stock has jumped 63% to $290 per share. It is currently up 53% YTD.
Alphabet has been a long-term winner and it is still the cheapest Magnificent 7 stock, along with Meta Platforms (NASDAQ:META).
Alphabet certainly has many of the characteristics of a Buffett stock, but one wonders if the move signals a changing of the guard at Berkshire Hathaway. With Greg Abel set to take over as CEO in January, was this move driven by the new leadership? Time will tell if we see a shift toward more “wonderful” tech companies at fair prices in the quarters ahead.
