Just months after Warren Buffett said that he sees a brighter future in Apple Inc as compared to IBM, the billionaire investor further reduced stake in IBM by nearly $3 billion in third quarter ending September-17. Warren Buffett’s Berkshire Hathaway Inc cut its equity stake in IBM by 32 percent in the third quarter to about 37 million shares worth $5.37 billion from 54.1 million shares worth $8.32 billion earlier, regulatory filings showed. According to a Reuters report, the IBM share stake has fallen by 54 percent since the end of 2016, when Berkshire owned roughly 81 million shares for which it paid about $13.8 billion.
During the quarter, Berkshire Hathaway boosted its stake in Apple Inc by 3 percent to 134.1 million shares worth $20.7 billion. The quarter was also marked by Berkshire Hathaway Inc becoming Bank of America Corp’s largest shareholder, by exercising its right to acquire 700 million shares. Notably, IBM, accounted for most of the stock sales that Warren Buffett and his deputy portfolio managers Todd Combs and Ted Weschler made in the quarter.
Warren Buffett had previously voiced a preference to avoid investing in technology stocks, but began building a stake in Apple in 2016. CNBC had earlier reported that the Oracle of Omaha added nearly 76 million more shares in January this year. The iconic investor had said back then, “Apple strikes me as having quite a sticky product, and an enormously useful product to people that use it.” At the same time, In Warren Buffett revealed he had begun selling IBM, telling CNBC he did not value Big Blue as highly as he did six years earlier when he started buying.
According to a Reuters report, Berkshire also reported lower stakes in Wells Fargo and cable TV company Charter Communications Inc, and higher stakes in seed company Monsanto Co and credit card issuer Synchrony Financial. Further, Berkshire did not report any stake in Wabco Holdings Inc which sells brake and suspension systems for commercial vehicles. Last quarter, Berkshire Hathaway cashed out its entire stake in the 125-year-old American multinational conglomerate General Electric worth $315 million according to filings. Berkshire Hathaway owned about 10.6 million shares in the company. Soon after General Electric announced the exit of the long-time CEO Jeffrey Immelt, Warren Buffett dumped all the holdings remained after he extended help in 2008.