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Warren Buffett is hunting for “an elephant-sized acquisition,” but he is not optimistic about getting it done.

The billionaire investor wrote in an annual letter to shareholders on Saturday that the prospects of landing a mega-deal for his Berkshire Hathaway Inc conglomerate are “not good,” because “prices are sky-high for businesses possessing decent long-term prospects.”

It is a problem for the Berkshire chairman and chief executive, whose company is sitting on $112 billion in cash and other low-returning assets that it has been struggling to invest for years.

“In the years ahead, we hope to move much of our excess liquidity into businesses that Berkshire will permanently own. The immediate prospects for that, however, are not good: Prices are sky-high for businesses possessing decent long-term prospects,” Buffett wrote. “That disappointing reality means that 2019 will likely see us again expanding our holdings of marketable equities. We continue, nevertheless, to hope for an elephant-sized acquisition.”

The prospect of such a deal, “causes my heart … to beat faster,” the 88-year-old investor said.

NO ELEPHANT IN THE ROOM

But Buffet said he would not get caught short of cash that he could use should market conditions deteriorate. Some of Buffett’s transactions over the last decade or so have included complex deals with distressed companies, including in the aftermath of the global financial crisis.

Buffett’s insurance business, meanwhile, collects premiums from businesses and individuals, cash that Buffett and his deputies use to make other investments.

But the U.S. stock market has been on a stride since the financial crisis a decade ago, leaving little room for the bargain-hunting value investor to make his mark, much as had been the case for Buffett during the run-up in technology stocks in the 1990s.

Buffett often invests in stocks, such as Apple Inc , when he cannot find whole companies to buy. On Saturday, he said his inability to find a company to buy meant more stock buying is likely in 2019.

The Omaha, Nebraska, investor has also been snapping up more shares of his own stock. Berkshire bought back about $1.3 billion of its common stock in 2018, the company said.

But Buffett slammed corporate bosses who buy stock back when prices are lofty. Stock buybacks “should be price-sensitive,” and “blindly buying an overpriced stock is value-destructive, a fact lost on many promotional or ever-optimistic CEOs,” Buffett said in the closely watched letter.

Several U.S. lawmakers have proposed restricting share buybacks, saying companies are incurring debt or wasting money to prop up their stock prices, while not making investments in their business or properly paying employees. Companies often argue they are just returning cash they cannot use to shareholders who can put the money to work.

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