Morningstar

Berkshire Hathaway: Abel Commits $10 Billion to Alphabet's $80 Billion Capital Raise

The move would increase Alphabet’s holding to 9.5% of Berkshire’s portfolio.

The Berkshire Hathaway Inc. is displayed on a smartphone screen.
Cheng Xin via Getty
Securities in This Article
Alphabet Inc Class C
(GOOG)
Berkshire Hathaway Inc Class B
(BRK.B)

Key Morningstar Metrics for Berkshire Hathaway

  • Fair Value Estimate
    : $510.00
  • Morningstar Rating
    : ★★★★
  • Morningstar Economic Moat Rating
    : Narrow
  • Morningstar Uncertainty Rating
    : Low

Alphabet GOOG announced on June 1 that it plans to raise $80 billion through equity offerings to fund an expansion of its AI infrastructure, with Berkshire Hathaway BRK.B agreeing to invest $10 billion as part of the funding initiative.

Why it matters: This marks Berkshire CEO Greg Abel’s second big outlay of cash since taking the helm, having just announced a deal to acquire homebuilder Taylor Morrison Home Corporation for close to $6.8 billion in an all-cash transaction at the end of May 2026.

  • Alphabet has reached an agreement to sell $5 billion of its Class A shares to Berkshire at $351.81 per share and another $5 billion of its Class C stock at $348.20 per share. This would increase Berkshire’s stake in Alphabet’s Class A shares by 400% and its holdings in the Class C shares by 26%.
  • Once the fundraising is done, Berkshire would still hold less than 1% of Alphabet’s outstanding shares. However, the move would increase Alphabet’s holding to 9.5% of Berkshire’s portfolio (valued at $341.5 billion with the added stakes in Alphabet), up from 5.3% at the end of the first quarter (when the stock investment portfolio was worth $312.6 billion).
  • The big bet on Alphabet’s AI buildout is a marked shift for Berkshire, which has traditionally favored businesses with more predictable economics, noting that Buffett had rationalized the insurer’s big stake in Apple over the years by looking at it as a consumer products firm rather than a technology company.

The bottom line: We are leaving our $765,000 ($510) per Class A (B) share fair value estimate for Berkshire’s in place for the time being, but will update our valuation if it changes meaningfully after adding the increased stake in Alphabet, as well as our integration of Taylor Morrison Home into the manufacturing, service, and retailing segment, in our valuation model.

Editor’s Note: This analysis was originally published as a stock note by Morningstar Equity Research.

The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.

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