Warren Buffett's Berkshire Hathaway buys $1B of Apple stock

Posted:
in AAPL Investors edited May 2016
Investor Warren Buffett has taken advantage of Apple's lowest share price in years, as new filings with the U.S. Securities and Exchange Commission reveal Berkshire Hathaway now owns 9.81 million shares of the iPhone maker.


Warren Buffett and President Barack Obama, via Wikipedia.


Shares of AAPL were up nearly 2 percent in premarket trading on Monday after investors learned of Buffett's new stake. The shares, purchased as of March 31, are valued at about $1.07 billion, as noted by The Wall Street Journal.

News of Buffett's buy-in comes after activist investor Carl Icahn sold all of his shares in the company last month. Icahn said he still views Apple as a "great company," but concerns over the Chinese economy and government led him to sell off his shares.

And last week it was revealed that David Tepper's Appaloosa Management also sold its stake in Apple, dumping more than 1.26 million shares worth about $133 million.

Buffett's stake in Apple is noteworthy because Berkshire Hathaway has traditionally avoided technology stocks. Berkshare also boosted its position in IBM, quarterly SEC filings reveal.

Though Buffett didn't previously own shares in AAPL, he did weigh in on the company in 2013, saying he thought Apple Chief Executive Tim Cook should buy back more shares and build value. At the time, he compared buying back shares of Apple to purchasing a dollar valued at 80 cents.

Buffett also admitted at the time that Apple might carry "too much" cash. As of the end of last quarter, Apple had $233 billion, but 90 percent of it is held overseas.

Though Buffett bought in last quarter, shares of Apple reached their lowest levels in nearly two years last week, dipping briefly below $90. It's unknown how much the hedge fund manager owns as of today.
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Comments

  • Reply 1 of 67
    lkrupplkrupp Posts: 10,557member
    If the Oracle of Omaha thinks Apple has a future then believe it.
    chialatifbpschlackfotoformatpalominecalilightknightronn
  • Reply 2 of 67
    NY1822NY1822 Posts: 621member
    sog35 said:
    lkrupp said:
    If the Oracle of Omaha thinks Apple has a future then believe it.
    agree.

    Follow Buffett guys. Buy stock now and hold for 5-10 years and you probably will be smiling.
    http://www.fool.com/investing/general/2016/03/15/what-will-apple-incs-dividend-be-in-5-years.aspx
  • Reply 3 of 67
    jmgregory1jmgregory1 Posts: 474member
    Buffett generally takes a long-term view on business and his stock buys reflect that.  For anyone to see Apple as a long-term risk is idiotic.  The rest of Wall Street simply manipulates Apple stock in order to make short terms gains, because so many investors today can't think beyond the next reporting, or in some cases what they perceive to be issues on a day to day basis.
    latifbpmdriftmeyerai46calibaconstangviclauyycanton zuykov
  • Reply 4 of 67
    rogifan_newrogifan_new Posts: 4,297member
    This is interesting as Buffett has said in the past he's not interested in investing in technology (other than IBM stake).
  • Reply 5 of 67
    To AppleInsider staff: Please note that it is highly likely that Warren Buffett had nothing to do with the investment decision to buy AAPL. He may have, but the total amount of the purchase is small enough to warrant that either Todd or Ted (one of the managers who Warren hired a few years ago to replace him) were the likely buyers. This is a very important distinction.
    SpamSandwichcnocbuijackansijony0jonl
  • Reply 6 of 67
    anantksundaramanantksundaram Posts: 20,404member
    I will take, in spades, the wisdom of Buffet over that of the Tepper/Icahn types and third-rate hedge funds. Any day. 
    avidthinkerai46calibaconstangronn
  • Reply 7 of 67
    anantksundaramanantksundaram Posts: 20,404member
    To AppleInsider staff: Please note that it is highly likely that Warren Buffett had nothing to do with the investment decision to buy AAPL. He may have, but the total amount of the purchase is small enough to warrant that either Todd or Ted (one of the managers who Warren hired a few years ago to replace him) were the likely buyers. This is a very important distinction.
    Of course it's Todd or Ted. So what? Buffet is the boss of BRK. Period. And, one billion bollars is too small for Buffett? Give me a break....
    edited May 2016 mwhiteai46calironnafrodrianton zuykov
  • Reply 8 of 67
    rob53rob53 Posts: 3,251member
    To AppleInsider staff: Please note that it is highly likely that Warren Buffett had nothing to do with the investment decision to buy AAPL. He may have, but the total amount of the purchase is small enough to warrant that either Todd or Ted (one of the managers who Warren hired a few years ago to replace him) were the likely buyers. This is a very important distinction.
    So a $1.07B stock purchase is small potatoes? Wow, must be nice to consider that amount of money to be chump change. 
    calironnanton zuykov
  • Reply 9 of 67
    Warren Buffett has repeatedly said in interviews that Todd and Ted DO NOT consult Warren Buffett before their purchases. Feel free to go back and watch his CNBC interviews. Of course, I do not know for sure whether they consult Warren Buffett or not, but that is what he has said in the past.
  • Reply 10 of 67
    eideardeideard Posts: 428member
    Classic difference between pimps like Icahn and a long term value investor like Uncle Warren.
    ronnanton zuykov
  • Reply 11 of 67
    rogifan_newrogifan_new Posts: 4,297member
    sog35 said:
    To AppleInsider staff: Please note that it is highly likely that Warren Buffett had nothing to do with the investment decision to buy AAPL. He may have, but the total amount of the purchase is small enough to warrant that either Todd or Ted (one of the managers who Warren hired a few years ago to replace him) were the likely buyers. This is a very important distinction.
    If you don't think Warren was part of the discussions to buy $1 Bil in Apple stock you are crazy.

    Yes $1 Bil is not a huge amount for Bershire, but Buffett rarely invests in tech. No doubt they asked Warren about it before the purchase.
    Apparently they said they view Apple as a consumer products company not a tech company hence the investment.
    ronn
  • Reply 12 of 67
    rogifan_newrogifan_new Posts: 4,297member

    Warren Buffett has repeatedly said in interviews that Todd and Ted DO NOT consult Warren Buffett before their purchases. Feel free to go back and watch his CNBC interviews. Of course, I do not know for sure whether they consult Warren Buffett or not, but that is what he has said in the past.
    Who cares whether he was part of the decision or not. It's his company and these guys are acting on his behalf.
    calironnpscooter63
  • Reply 13 of 67
    sog35 said:
    If you don't think Warren was part of the discussions to buy $1 Bil in Apple stock you are crazy.

    Yes $1 Bil is not a huge amount for Bershire, but Buffett rarely invests in tech. No doubt they asked Warren about it before the purchase.
    Apparently they said they view Apple as a consumer products company not a tech company hence the investment.
    can you post the link to this statement?
  • Reply 14 of 67
    SpamSandwichSpamSandwich Posts: 33,407member
    This is interesting as Buffett has said in the past he's not interested in investing in technology (other than IBM stake).
    Not just interesting, it's downright unusual. Maybe the guy chosen by Buffet to be his replacement made the decision.
  • Reply 15 of 67
    SpamSandwichSpamSandwich Posts: 33,407member
    To AppleInsider staff: Please note that it is highly likely that Warren Buffett had nothing to do with the investment decision to buy AAPL. He may have, but the total amount of the purchase is small enough to warrant that either Todd or Ted (one of the managers who Warren hired a few years ago to replace him) were the likely buyers. This is a very important distinction.
    I tend to agree this was probably not a buy initiated by Buffet.
    ValueAnalyst
  • Reply 16 of 67
    msuberlymsuberly Posts: 236member
    Berkshire's $1B holding in Apple is #16 on its list of publicly traded holdings, and represents less than .3% of Berkshire's market cap.  Some other perspective: Berkshire added $1.25B of Phillips 66 stock last quarter...where is the headline of that?

    This investment will hardly move the needle at Berkshire. If Buffet was consulted at all, it would be because of the hype surround Berkshire's stock picks and not because of the fundamentals of the investment.
  • Reply 17 of 67
    Don't get me wrong: Regardless who initiated the position, this is big news. It's not the HUGE news that it would've been if Warren Buffett went on CNBC and indicated he was the one who made the decision and talked up the company's prospects and low valuation. But nevertheless, whether it's Todd, Ted or Warren, it is nice to have the seal of approval from Berkshire Hathaway.
    jackansi
  • Reply 18 of 67
    msuberly said:
    Berkshire's $1B holding in Apple is #16 on its list of publicly traded holdings, and represents less than .3% of Berkshire's market cap.  Some other perspective: Berkshire added $1.25B of Phillips 66 stock last quarter...where is the headline of that?

    This investment will hardly move the needle at Berkshire. If Buffet was consulted at all, it would be because of the hype surround Berkshire's stock picks and not because of the fundamentals of the investment.
    I couldn't agree more. They may have consulted him because of the hype this will get on CNBC and other financial websites, but probably not because of the fundamentals of the investment. Thumbs up for putting my thoughts into words better than I could.
    jackansi
  • Reply 19 of 67
    jimtjimt Posts: 16member
    Hmmm...a billion here, a billion there... ...pretty soon you're talking big money!
  • Reply 20 of 67
    bkkcanuckbkkcanuck Posts: 864member
    To AppleInsider staff: Please note that it is highly likely that Warren Buffett had nothing to do with the investment decision to buy AAPL. He may have, but the total amount of the purchase is small enough to warrant that either Todd or Ted (one of the managers who Warren hired a few years ago to replace him) were the likely buyers. This is a very important distinction.
    I tend to agree this was probably not a buy initiated by Buffet.
    Why?  Warren Buffet has stated that he only invests in things he understands?  Do you think Warren Buffet has trouble understanding a phone?  What he avoids is things he cannot really see the value of (why he stayed out of .com stocks - he could not see what they were doing that would warrant interest, i.e. they were not tangible products).  Apple is a manufacturer of quality products.  It earns money on products that can easily be understood, and it has a significant and rising dividend (i.e. more of a value stock).  I am sure that he has imparted this simple investing strategy to the next generation.  

    What people have to understand is that they buy a wide range of stocks they believe in, but not everything pays off in the end.... just that the simple investing strategy has invested in stocks that have paid off more than failed to pay off.  i.e. One pick does not mean it is a guaranteed return, no stock can.  

    Unfortunately the market is made up more of the short-term (almost day trader) types than those that are looking to build a stable long-term portfolio.
    calironn
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