Motley Fool Money: “Warren Buffett’s Last Hurrah”
Date: February 18, 2026
Host: Travis Hoy
Guests: Lou Whiteman, Rachel Warren

Episode Overview

This episode of Motley Fool Money centers on Warren Buffett’s final investment actions as leader of Berkshire Hathaway, the challenges facing his successor Greg Abel, and wider questions about what’s next for Berkshire’s vast cash hoard and investment philosophy. The episode also covers high-stakes media mergers—focusing on the Paramount, Netflix, and Warner Brothers Discovery bidding—and concludes with a pulse check on the US housing market via Toll Brothers’ earnings and strategic shifts.

Section 1: Buffett's Final Moves & Berkshire’s Next Chapter

Key Discussion Points

• Berkshire’s Latest 13F Filing:

  • Final stock buys under Buffett included New York Times, Chubb, Domino’s Pizza, and Chevron.
  • Partial sales of key tech holdings:
    • Sold 4.3% of Apple position
    • Sold 77% of Amazon stake

• Portfolio Character & The “Buffett Dilemma”:

  • Berkshire’s size makes it difficult for any single investment to “move the needle.”
    • Lou Whiteman: "Berkshire is too big for even a home run move to make a difference." (01:19)
    • Even big Apple or Amazon trades scarcely impact returns.

• Transition to Greg Abel:

  • Abel is more operationally focused, known for running the businesses, not just picking stocks.
  • Rachel Warren: "Abel's been known as an operator ... Investors might be able to expect more focus on growing Berkshire's operating subsidiaries." (03:40)
  • Buffett remains chairman, so major capital decisions will still bear his influence for now.
  • Rumors Abel will move away from underperforming legacy holdings (e.g., Kraft Heinz).

• The Massive Cash Pile:

  • Berkshire has over $380 billion in cash—flexibility or burden?
  • The four pillars (insurance, railroad, energy, Apple) remain core.

Notable Quotes

• On the Challenge of Scale:

  • Lou Whiteman (01:19): “Berkshire is too big for even a home run move to make a difference. … It’s a weird problem to have—I think it’s a problem we all wish we had.”

• On the Portfolio’s Character:

  • Lou Whiteman (01:09): “Selling tech to buy media is the most boomer move ever. But kidding aside, I think this is a boomer portfolio.”

• Abel’s Differentiation?

  • Rachel Warren (04:15): “There’s kind of been some early signs that suggest that Abel might be more aggressive in exiting some of the stagnant legacy positions.”

Timestamps

• [00:05] – Episode kickoff, Berkshire’s latest filings
• [01:19] – Berkshire’s scale and the challenge for returns
• [02:35] – Specifics on sold/bought positions this quarter
• [03:09] – Value investing roots; Abel’s background and future focus
• [04:41] – Potential exit from troubled holdings (Kraft Heinz)
• [05:18] – What will Berkshire do with its $380B in cash?

Section 2: Berkshire’s Capital Allocation — Dividend on the Table?

Key Discussion Points

• Debate Over Capital Deployment:

  • Will Berkshire finally pay a dividend?
  • Buybacks vs. dividends—what will the new team prefer?
  • Lou Whiteman: “I think a dividend is coming. Whether or not buybacks are coming, we’ll see.” (05:48)
  • Most of Berkshire’s industry peers (insurance, railroads, aerospace) pay dividends.

• Comparisons to Apple’s Post-Jobs Era:

  • Tim Cook became CEO and rapidly increased dividends and buybacks.
  • Berkshire could easily sustain a 5% dividend yield for a decade (07:02).

Notable Quotes

• On the Dividend Possibility:
  • Lou Whiteman (05:52): “I think a dividend would actually go over better with the market.”
  • Travis Hoy (07:01): “Berkshire Hathaway could come out and pay a 5% dividend yield… They could even bump it up to 6, 7, 8% if they want to.”

Timestamps

• [05:18] – Capital allocation question posed
• [05:40] – Dividend debate
• [07:01] – Berkshire’s dividend and buyback capacity

Section 3: The Paramount-Netflix-Warner Bros. Discovery Merger Drama

Key Discussion Points

• Current Bid Status:

  • Paramount gets a final opportunity to outbid Netflix for Warner Bros. Discovery:
    • Paramount’s bid: $108B ($30/share, all cash; possibly up to $31/share)
    • Netflix retains right to match or exceed any offer
    • Paramount offering to cover the $2.8B breakup fee

• Deal Complexity:

  • Netflix wants only studios and HBO, plans to spin off cable channels.
  • Paramount’s bid is heavily debt-funded, with backing from Larry Ellison, Redbird Capital, and multiple sovereign wealth funds.

• Regulatory & Financial Challenges:

  • Paramount’s deal seen as more fragile—heavy debt, backstopped by Oracle shares that have dropped over 50%.
  • “You don’t want [the] check to bounce two years down the line.” — Travis Hoy (12:23)
  • Regulatory risk may favor Netflix, as their acquisition would impact programming less due to their larger balance sheet.

• Netflix as the Favorite:

  • Netflix holds right of first refusal and can match any offer.
  • Lou Whiteman: “This is Netflix saying, show up or shut up. Put your cards on a table, stop your whining and let’s see what happens.” (11:10)

Notable Quotes

• On the Board’s Calculus:

  • Travis Hoy (12:23): “If you get two years down the line … and guess what? The check bounces. You don't want that to happen either.”

• On Debt and Antitrust:

  • Lou Whiteman (13:19): “The amount of an impact that the debt will have on being able to fund new programming is significantly different. I think that helps the antitrust case for Netflix.”

Timestamps

• [08:53] – Warner Bros./Netflix/Paramount deal drama update begins
• [09:14] – Details on competing bids and structure
• [11:03] – Lou: Netflix’s strategic position
• [12:23] – Larry Ellison’s role, risks to deal solidity
• [13:19] – Debt implications for programming, antitrust

Section 4: US Housing Market Update – Toll Brothers

Key Discussion Points

• Toll Brothers Q1 2026 Results:

  • Luxury homebuilder outperforms expectations despite overall housing market challenges.
  • Strong revenue/profits despite delivering fewer homes; focus on high-wealth clients.
  • EPS of $2.19, $2.2B revenue; average backlog prices up to $1.2M.
  • Strategic exit from multifamily development to focus on core luxury buyers.

• Market Insights:

  • Luxury buyers are less sensitive to high interest rates—28% pay all cash.
  • 30% of buyers are first-timers, but older and richer than US average.
  • Intergenerational wealth transfer is fueling cash-rich demand.

• Concerns Moving Forward:

  • Contract unit volumes fell 20% YoY—potential weakness, even at the high end.
  • If the luxury segment softens, it’s a “warning sign” for broader housing and economy (17:52).

Notable Quotes

• On Luxury Segments’ Strength:

  • Rachel Warren (15:50): “Even the affluent customer base, they’re navigating high interest rates, but they’re doing so better than the broader market... That’s why you’re seeing a company like Toll Brothers maintaining gross margins of about 25% even with softening overall demand.”

• On Housing Market Warning Signs:

  • Lou Whiteman (17:52): “Any sign of weakness on the luxury side does not speak well for the entire housing or the entire economy. This is sort of more a warning sign than a victory lap right here.”

Timestamps

• [15:29] – Toll Brothers earnings and housing market state
• [17:49] – Interpreting the mixed signals; K-shaped economy concept

Memorable Moments

• “Selling tech to buy media is the most boomer move ever.” — Lou Whiteman (01:06)
• “Abel’s been known as an operator…You might expect more focus on growing operating subsidiaries.” — Rachel Warren (03:40)
• “Berkshire is too big for even a home run move to make a difference.” — Lou Whiteman (01:19)
• “This is Netflix saying, show up or shut up.” — Lou Whiteman (11:10)
• “If anything, this is sort of more a warning sign than a victory lap right here.” — Lou Whiteman (17:52)

Takeaways for Investors and Observers

• Berkshire Hathaway is facing an inflection point: With Greg Abel stepping in, expect more focus on operations and potential exits from underperforming legacy holdings, but don’t expect an immediate philosophical overhaul.
• Berkshire’s capital allocation choices are being closely watched: A longstanding promise not to pay dividends may be up for change, given peer trends and the firm’s enormous cash pile.
• Big media mergers remain a regulatory- and liquidity-driven chess match: Paramount’s bid’s reliance on debt and fluctuating backer collateral could sink its chances, keeping Netflix in pole position.
• Luxury housing’s resilience may be nearing its limits: Toll Brothers’ success underscores economic divides, but falling unit volumes raise broader concerns about the housing market’s health.