You’ll be shocked by these 5 companies that Warren Buffett could buy with cash right now

Berkshire Hathaway (BRK.A) (BRK.B -2.18%) recently revealed that it now has more than $325 billion in cash and short-term investments on its balance sheet, by far the most it has ever had. This is the result of some large stock sales, the continued profitability of Berkshire’s business, and a lack of stock buybacks lately.

To say the least, $325 billion gives Berkshire and its CEO Warren Buffett unprecedented financial flexibility to pursue opportunities, including a potential massive takeover, which Buffett has been hoping for for years.

In fact, at the time of writing, there are only 23 US companies with a market capitalization greater than Berkshire Hathaway’s cash hoard. Between the New York Stock Exchange and Nasdaq, there are more than 5,400 companies that Berkshire could theoretically buy cash.

5 Companies Berkshire Could Buy Now

First, it’s important to note that Buffett insists on maintaining $30 billion in reserves at all times, so ruling this out reduces Berkshire’s disposable cash to only $295 billion. And while Berkshire could acquire any of the 5,400-plus public companies, and many more private companies, let’s limit this discussion to the companies big enough to be a trillion-dollar needle-mover. conglomerate and have characteristics that Buffett likes.

With that, here are five companies that are well within the possibilities for a takeover in Berkshire:

• Coca-cola (KO 0.15%): The food and beverage giant has been a long-time Berkshire stock holder, and it’s no secret that Warren Buffett is a big fan of the company. Coca-Cola has a market cap of about $280 billion at the time of writing, but Berkshire already owns 9.3% of the stock, so it would only need to buy the roughly 93% it doesn’t already own.
• Chevron (CVX 0.59%): Berkshire has invested heavily in energy shares in recent years, and Berkshire already owns about 6.5% of Chevron, so its $280 billion market cap is within the realm of possibility of a full takeover.
• McDonald’s (MCD -0.80%): One of the best-known brands in the world, excellent profitability and many valuable assets (real estate) could make McDonald’s attractive. Moreover, Buffett is a regular of the company with a market cap of $212 billion.
• Adobe (ADBE -0.30%): Buffett isn’t really a “tech guy” himself, but Berkshire’s investment portfolio has gradually incorporated more of the tech sector. Adobe has excellent profitability and the wide moat that comes with products used to one degree or another by virtually every Internet user. With a market cap of $213 billion, Berkshire could afford it.
• Caterpillar (CAT -0.82%): Infrastructure investment is likely to be a long-term trend in the US and many key areas around the world, and a $184 billion market cap Caterpillar could be a big winner.

Would Does Berkshire want to buy any of these companies?

To be clear, we have no idea whether Warren Buffett or the other Berkshire leaders have any interest in acquiring any of these companies, especially now that the market is at an all-time high. Furthermore, Berkshire would likely have to pay a significant premium above current market value to actually buy one.

However, this puts into perspective how large Berkshire’s money supply has become. It’s also worth noting that Berkshire could potentially expand its budget even further if it were willing to borrow money. After all, Berkshire has one of the best corporate credit ratings in the United States and has access to cheap loans if it chooses.

I don’t think Berkshire will be making a major acquisition anytime soon. The $325 billion in cash yields roughly 5%, much of it in short-term government bonds, so Buffett is happy with some risk-free income for now. But this gives Berkshire unparalleled financial flexibility to take advantage of the opportunities that arise, and if we get a recession or a stock market correction in 2025, a $325 billion checkbook in Warren Buffett’s hand could become very interesting .