Warren Buffett is betting big on the new- age multinational technology company Apple, and feels that the company’s future is more certain than the 106 year old IBM. In a conversation with CNBC news channel, the billionaire investor said yesterday, “I feel more certain about the future as I look at a company like Apple than when I look at IBM now.”
Earlier this month, Warren Buffett’s bet on Apple increased the portfolio value of Berkshire Hathaway by little more than $1 billion in a single day after the stock rallied on the back of strong quarterly earnings. As of 30 June 2017, regulatory filings show Berkshire Hathaway owns 130.2 million shares of Apple Inc which is worth over 21.1 billion now.
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. 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.”
In comparison, Berkshire Hathaway sold off nearly 33% of its total holdings in IBM in the first and second quarters of 2017. At the end of 2016, Berkshire Hathaway had 81 million shares of IBM. In may this year, he told the channel, “I don’t value IBM the same way that I did six years ago when I started buying. I’ve revalued it somewhat downward.”
On Wednesday, Apple’s stock was trading around $162 per share and hit a record high shortly after the open. Based on a $162 share price, Berkshire hathaway’s Apple stake amounts to $ 21.1 billion. The legendary investor is in no mood to cash in on the gains made by Apple. He told CNBC yesterday, “I’ve never sold a share,” asked whether he’s planning to pile up more of the stock, he said, “I certainly was buying last quarter and I don’t pay attention to the calendar when I’m buying.”
Berkshire Hathaway Inc became Bank of America Corp’s largest shareholder by exercising its right to acquire 700 million shares at a steep discount on Tuesday. Speaking about his investments in the second and third largest America’s banks, Warren Buffett said that he continued to have faith in investments in Bank of America Corp and Wells Fargo.