For a guy known as being a bit averse to investing in tech companies, Warren Buffett seems to be breaking out of his shell. The company now doles out $0.57 per share every quarter. The investment is a bet that Cook, Apple’s CEO, will be able to re-right the sagging ship – iPhone sales in the first three months of the year fell for the first time – and head the stock up again.
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The filing did not indicate when Buffett purchased the shares or his reasons, but Buffett is renowned as a “value” investor who takes positions in firms which trade below what he sees as their fair value.
He also has holdings of IBM, which he has been accumulating over the past several years, and he is reportedly backing a bid to buy Yahoo.
Buffett’s assistant did not respond to a request for comment.
Berkshire’s major investments are in companies such as American Express Co., Coca-Cola Co. and Wells Fargo & Co. The paper says they are willing to invest in areas that Mr Buffett himself wouldn’t. “Buffett had a long-standing bias against technology investments, which he felt had no margin of safety”. Buffett tends to focus on slower-growth companies that he believes are undervalued by the market, and he has not been a big tech investor.
“I’m an enormous admirer of Dan and what he has accomplished in Quicken Loans”, Buffett said to CNBC. “It’s much easier for me to figure out what Coca-Cola is worth than Google or Facebook or you name it”.
The Apple holding makes Berkshire Hathaway the 56th largest shareholder.
The investment could have been made by one of Buffett’s deputies, Todd Combs or Ted Weschler. The conglomerate reported the new investment – which may have been made with money from the entire sale of AT&T Inc (T) stock – in a regulatory filing of all its holdings as of March 31.
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Berkshire also added 198,853 IBM shares during the quarter to give it 81.2 million shares. “He left intact his prediction of a 12% bounce in iPhone sales next year – along with a share price target more than 60 per cent above its current level”. IBM focuses more on software and technology services these days. Berkshire Hathaway’s portfolio has been built with investments in financial companies, insurers, and industrial businesses like Phillips 66. For the protection of AP and its licensors, content may not be copied, altered or redistributed in any form. Doing so may result in civil and/or criminal penalties.
