Greg Abel knows Berkshire cold, but some miss the Buffett magic

LivestreamMenuMake ItselectUSAINTLLivestreamSearch quotes, news & videosLivestreamWatchlistSIGN INCreate free accountMarketsBusinessInvestingTechPoliticsVideoWatchlistInvesting ClubPROLivestreamMenu (This is the Warren Buffett Watch newsletter, news and analysis on all things Warren Buffett and Berkshire Hathaway. You can sign up here to receive it every Friday evening in your inbox.) He's no Warren Buffett, and thankfully, he's not trying to be Warren Buffett. But Greg Abel is getting decent, if not spectacular, reviews for leading his first annual shareholders meeting as CEO. He's not the draw that Buffett and Munger have been over the years, with the CHI Health Center arena in Omaha a bit more than half full, although that turnout is still spectacular compared to the typical corporate annual meeting. Abel's detailed knowledge about Berkshire's operating businesses won praise, but the unexplained absence of substantial buybacks and a lack of clarity on the future of the equity portfolio and Berkshire's big cash pile are coming up as negatives. Check Capital Management Steve Check listed the positives for CNBC.com's Yun Li: "Very solid. No misspoke words. Thorough answers. Nice guy, but we sure don't have the laughs that we had with Warren and Charlie." Barron's Berkshire watcher, Andrew Bary, gave Abel a "B-plus" but thinks he "needs improvement on his delivery — too many rambling answers — and on capital allocation messaging." He also warns Abel's "solid performance" could be overshadowed by Berkshire's "trivial" stock repurchases of just $234 million in the first quarter, despite its March announcement that buybacks had "resumed." In a video interview with Yahoo Finance, CFRA Research analyst Cathy Seifer called Abel's performance "okay." "Greg obviously has big shoes to fill and he's a very capable business leader," but she thinks Berkshire needs to do a better job "articulating to investors what the plan is to manage the investment portfolios." She's also disappointed at the low level of buybacks. "If Berkshire isn't buying back their stock, why should you?" University of Maryland finance professor David Kass told Fortune Abel "demonstrated his knowledge of and passion for" Berkshire's businesses and investments. "He is more serious in demeanor, but like Warren he is very pleasant. Since there will be less humor at future Berkshire meetings, they will be less entertaining. But Greg will be able to respond well to all shareholder questions and discuss the past performance and outlook for all of Berkshire's businesses." Shareholder Tilman Versch called it "definitely the meeting with the deepest insights into Berkshire's businesses in the last decade." For some shareholders, however, those business insights are not why they came to Omaha. Reuters quoted Xiao Zhang as saying, "I was a little bit disappointed." "In previous years, Warren Buffett and Charlie Munger sat on the stage, sharing their investing experiences and also life experiences and philosophies. This year, I didn't hear something like that." Sophia Deng told the wire service, "Most people are here for investing knowledge and life philosophies. It was one of the reasons I was drawn to Berkshire. "With Greg Abel, the emphasis was very, very different. It (became) more of an operational excellence conference, and it's not what I'm interested in as much." Investors gave Abel and Berkshire's first quarter financials, released just before Saturday's meeting, a positive, if muted, review. The A shares gained 1% on the week. The B shares were also positive, but up just 0.6%. The S&P, however, continued to outperform both with a 2.3% gain. Charlie Shamieh, the chairman of reinsurer Gen Re since 2018, has been chosen by Berkshire Hathaway to run all of its insurance operations when Ajit Jain decides to retire, according to The Wall Street Journal, which cites "people familiar with the matter." The Journal says Jain, who is 74, hasn't indicated when he might step down and is "expected to remain in the role for the foreseeable future." Berkshire acquired Gen Re in 1998 for $21.7 billion in stock. At the 2011 annual meeting, Buffett said hiring Jain in 1982 was his "best deal" and "I can't think of any decision he's ever made that I think I could have made better." As Berkshire's long serving CFO, Marc D. Hamburg kept a low profile. After his scheduled retirement on June 1, he will be flying high on a Berkshire subsidiary. In a filing, the company says that "in recognition of Mr. Hamburg's many decades of service," he, or his surviving spouse, will be provided with "up to 30 flight hours per year on a mid-sized NetJets aircraft" until 2037. The flights, along with money to cover taxes resulting from the benefit, will cost around $490 thousand a year, according to the company. The filing also says the new CFO, Charles Chang, will get an $8 million annual cash salary. Hamburg's total compensation last year was $4.3 million

Greg Abel knows Berkshire cold, but some miss the Buffett magic

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