Berkshire Hathaway Stock (BRK.B) Jumps as CEO Greg Abel Commits His Salary to Share Purchases

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Berkshire Hathaway (BRK.B) stock rallied on Thursday after CEO Greg Abel said he plans to use all of his annual salary to purchase shares of the investment company’s stock. That’s a major commitment from Abel, as his take-home pay is set at roughly $15 million per year. His on-paper salary is $25 million, but that doesn’t account for taxes.

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To back up his claim, Abel purchased $15.3 million worth of BRK.A stock, which comes to 21 shares. These were bought for roughly $730,000 each. This news has Abel following in the footsteps of former Berkshire Hathaway CEO and current Chairman Warren Buffett, who also invested a significant portion of his wealth in the company’s shares.

Abel also noted that Berkshire Hathaway will restart share repurchases, which have been on hold for the past six quarters. He said, “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. We may also purchase large blocks of shares directly from major holders when the opportunity presents itself. These purchases allow shareholders to own an incrementally larger piece of Berkshire’s businesses, without deploying any additional capital of their own.”

Berkshire Hathaway Stock Movement Today

Berkshire Hathaway stock was up on Thursday alongside the CEO’s share purchases. This pushed shares of BRK.B stock 0.82% higher this morning, following a 1.27% rally yesterday. However, the stock was still down 3.02% year-to-date and 2.08% over the past 12 months.

Is Berkshire Hathaway Stock a Buy, Sell, or Hold?

Turning to Wall Street, only a single analyst has weighed in on Berkshire Hathaway stock recently. Five-star UBS analyst Brian Meredith reiterated a Buy rating for BRK.B stock earlier this week. He also lowered his price target for the stock to $578 from $587, representing a potential 18.57% upside for the shares.

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