"I don't think the list of his 'fat-pitch' companies is all that exhaustive," said David Rolfe, who oversees $8.6 billion including Berkshire stock as chief investment officer of Wedgewood Partners Inc.
Buffett, 83, has struck some of his biggest deals in the last few years, adding to the earnings Berkshire already gets from operating businesses including auto insurer GEICO and railroad BNSF, which was acquired in 2010. Second-quarter net income rose 41 percent to $6.4 billion, the company said in an Aug. 1 regulatory filing.
The profits have replenished Berkshire's coffers at a rate of more than $1 billion a month and left him with the challenge of finding bigger investments. Cash stood at about $55.5 billion on June 30, more than double the amount Buffett has said he likes to keep on hand should his insurance businesses have to pay unusually large claims.
Some of those funds are going back into Berkshire's capital-intensive units. In the last 15 years, Buffett has bought electric utilities, natural-gas pipelines and the railroad, which routinely require billions of dollars in spending to maintain and upgrade equipment. In June, he said he was prepared to double his outlay on renewable-energy projects after committing $15 billion over the last decade.
Buffett still needs to find other outlets for the cash. He's shunned paying a dividend, arguing that shareholders are better off letting him invest the funds. He rarely buys back shares.
When opportunities do arise, Buffett has shown he can move decisively. The cash pile fell to $35.7 billion on June 30 last year as he teamed up with buyout firm 3G Capital to take HJ Heinz Co. private. In 2011, it dipped to a similar level when he spent $10.9 billion amassing a stake in IBM Corp.
While Buffett has said that low yields made him avoid bonds, not even stocks have tempted him much this year. The filing showed that Berkshire spent $2.05 billion on equities in the first half, about a third of the total from a year earlier. Its sales of stock more than doubled to $2.96 billion.
"It's more difficult, across the board, to find cheap assets," said John Fox, director of research at Fenimore Asset Management Inc. in Cobleskill, New York, which oversees $1.9 billion including Berkshire stock.
Other acquirers are also awash in cash. Private-equity firms were sitting on a record $1.16 trillion of capital as of July, according to Preqin Ltd., a London-based research firm.
"The amount of dry powder is unprecedented," said David Fann, CEO of TorreyCove Capital Partners, which advises investors in private equity. "This is the most amount of money that they've had to work with."
The money pile has prompted warnings from executives including Blackstone Group LP President Tony James and Apollo Global Management co-founder Josh Harris that some private-equity firms are paying too much.
Transactions of more than $250 million were valued at 10.2 times earnings before interest, taxes, depreciation and amortization in the first quarter, according to PitchBook Data Inc., a Seattle-based research firm. That compares with 9.8 times in the prior period. Consulting firm Bain & Co. has said that a reasonable leveraged buyout price is less than eight times Ebitda.
Unlike private-equity firms, which are under pressure to invest limited partners' funds, Buffett has the benefit of Berkshire's long-term shareholders who support his refusal to rush an acquisition or stock purchase.
"The guy's just not going to spend the cash to spend it," said Wedgewood Partners' Rolfe. He's "the best market timer I ever saw."
In 1998, the Berkshire CEO wrote in his annual letter to shareholders that he and Vice Chairman Charles Munger drew inspiration from Ted Williams, the Hall of Fame baseball player whose discipline at the plate helped him win six batting titles.
"Unlike Ted, we can't be called out if we resist three pitches that are barely in the strike zone," Buffett wrote. "Nevertheless, just standing there, day after day, with my bat on my shoulder is not my idea of fun."
With assistance from Devin Banerjee in New York.