Berkshire Hathaway Discloses Nearly $1 Billion Stake in Apple
Monday May 16, 2016 6:06 AM PDT by Mitchel Broussard
A regulatory filing by multinational conglomerate Berkshire Hathaway -- which is run by Warren Buffett -- today revealed that as of March 31, the company owned 9,811,747 shares in Apple stock (via Bloomberg). Berkshire Hathaway's shares were valued at over $1 billion at the end of the first quarter of 2016, but given Apple's recent dip in stock value, it has subsequently declined to nearly $900 million.
Berkshire Hathaway's stake in Apple appears to be a bet that the Cupertino company's stock will rebound, following its first ever year-over-year revenue drop in 13 years. The slump comes after Apple's April earnings call where it announced the first ever drop in iPhone sales in the 9 years that the smartphone has been on the market. Last week, shares of the company fell below $90 for the first time in nearly two years, but after Berkshire Hathaway's disclosure, Apple's stock price rose 2.2 percent to $92.50 in early trading Monday morning.
Earlier in April, Apple investor Carl Icahn decided to sell his stake in the company, explaining that he did so due to concern over China's attitude towards Apple's encroaching presence in the country. A second Apple investor, David Tepper, also dumped his shares of the company as its value continued to lessen. Tepper had 1.26 million shares that were valued at around $133 million.
Tag: Berkshire Hathaway
macaximx
I rather Buffett than Icahn.
Berkshire is a long term "value" investor. This news is an addition to a position they already had. They like things like railroads, Dairy Queen, sugar water, and everyday things that people simply want and need but get very little press. This is a rare exception in terms of attention.
The two guys in the other story are traders. Berkshire is an investor. Long term.
It was Warren's lieutenants, Ted Weschler or Todd Combs that made the trade. Imagine if you can buying that many shares and not appreciably impacting the stock price upwards. Can you say limit orders from several terminals? Their average price? $93.
According to their SEC 13F filings, they added Apple, increased IBM, Phillips 66 and Visa, decreased WalMart, Procter and Gamble (99%), and MasterCard. They dumped AT&T.
They have a policy of buying back any Berkshire A shares at +20% if any investor wants to exit. Virtually none do. Last price: $212,140 per share.
kas23
Where are the people who decry stock manipulation when a big name makes a huge AAPL transaction? Oh, my bad, I guess it doesn't work that way.
Crosscreek
Buy low....Sell high.
Muscle Master
We all know Apple can go up, Infact it can go much much higher that it is now.
They just need to invest in the right products and the right price.
I have money to spend and I want to spend it on Apple products.
I just don't want to be ripped off.
Agreed.. In this economy where I have to decide do I want a top of the line $3000 MBPr? or a weeks vacation in Honolulu...
Apple needs to get off its high horse and cuts those profit margins in half
maflynn
Well, I guess this is better news then other investors dumping Apple :)
BMcCoy
And that's still only 0.2% of the company.
The numbers are staggering...
joueboy
Your figure is only companies valuation. If this trend continues downward then the valuation goes down and that percentage goes up.
Jakexb
Watch people start reconsidering AAPL now that Buffett is in.
Solomani
Buffet is legendary and immensely successful because he is a strategic long-term investor. He invests in companies that sometimes takes years or even decades to show steady stock growth. Like Pepsi and other blue chips. It's been said that AAPL's fast-growth days are over, so it makes sense to categorize it closer to a long-term growth blue chip company like Pepsi or even McDonalds. They are globally familiar house-hold brands with huge loyal followings, so those brands will not die any time soon. Their stocks, on the other hand, are better for long-term growth like investing for your grandchildren's college fund. Not so great if you want to retire in 3 years. Even Microsoft has stopped being a fast-growth stock.
That's in stark contrast with the stock dumpers and manipulative shorters like Icahn. They're not in it for the long haul.
Is the end of "fast-growth stock" for Apple also correlate with the end of fast-pace innovation? Possibly. Apple can still innovate so long as they have some smart people inside (which they do). But these days, it's unrealistic to demand that Apple surprise us with something totally new and exciting every year.
in other news , investors buy low and sell high.
People are gambling the iPhone 7 does not suck, it's the product that will result in stock fluctuations. Though according to rumours of the device , could be tough times for stocks ahead in my opinion .
Apple could theoretically make a brilliant iPhone 7 and the stock could still tank the next day. Such a thing has happened before.
And Apple could theoretically announce record blockbuster profits/sales, and then the stock takes a dive the next day. Oh hey, it's also happened many times before.
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