From Nasdaq: 2025-05-21 07:00:00

Warren Buffett is set to step down as Berkshire Hathaway’s CEO after 60 years, leaving behind a $334 billion cash stockpile. He may make a big investment before his departure, possibly in one of the “Magnificent Seven” tech giants. Alphabet stands out as a cheap stock option, despite Buffett’s usual preference for cheaper stocks.

Buffett has concerns with the capital plans of the “Magnificent Seven,” particularly the massive investments in AI. He prefers businesses that can retain earnings rather than spend excessively. Alphabet’s heavy spending on data center buildouts may deter Buffett from taking a position in the stock, despite its potential long-term value.

While Alphabet remains a compelling investment due to its strong brand and market position, Buffett may not invest in it on his way out of Berkshire. The stock’s cheap valuation and investment in AI-powered search could pay off in the long run, but Buffett’s concerns with the company’s capital plans may keep him from taking a position.

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John Mackey, Suzanne Frey, and Randi Zuckerberg are members of The Motley Fool’s board of directors. Keithen Drury holds positions in Alphabet, Amazon, Meta Platforms, Nvidia, and Tesla. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Berkshire Hathaway, Meta Platforms, Microsoft, Nvidia, and Tesla. 1. The stock market saw a significant boost today, with the S&P 500 reaching a new record high. Tech stocks led the way, with Apple and Amazon both posting strong gains. The Dow Jones Industrial Average also saw a substantial increase, as investors remain optimistic about the economic recovery.

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Read more at Nasdaq: Could Warren Buffett’s Last Move as Berkshire Hathaway CEO Be Buying This Beaten-Down “Magnificent Seven” Stock?