Warren Buffet Will Continue To Invest In Apple Stocks

Theresa Obrien
May 10, 2018

"I didn't go into Apple because it was a tech stock in the least", Buffett explained at the Berkshire meeting.

His moves are so respected that his Apple announcement pushed the stock to a new record high.

"I clearly like Apple". "It is an unbelievable company", Buffett said. "We like very much the management and the way they think".

But amid some concerns that the conglomerate will take a hit if that happens, Buffett isn't at all anxious, according to a Morgan Stanley note on Berkshire Hathaway's annual letter to shareholders.

After offering its first stock buyback in August 2012, Apple has bought back $200 billion worth of stock, and just announced last week that it would repurchase an additional $100 billion in its shares.

Among various reasons of the utmost interest in Apple is the massive cash reserve to make company stock buybacks.

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"I think it's extremely hard to find acquisitions that would be accretive to Apple that would be in the $50 billion, or $100 billion or $200 billion range", Buffett said.

The epicenter of the festivities is Omaha's CenturyLink Center exhibition space: One wing is fully devoted to booths of Berkshire Hathaway-owned brands. For Mr. Tan, the big names mattered less than the Midwestern sensibilities: "There is a piece of this that really resonates with us, around being plain-spoken and investing in what you understand", he said.

Apple said that customers chose the US$999 iPhone X "more than any other iPhone each week" during the March quarter like they did in the December quarter.

Although investors enjoy speculating on which companies Apple should acquire, Buffett, ironically, is quite pessimistic about its M&A potential. For investors that like to invest based on which stocks Buffett believes in, let's take a look at how his largest positions have fared so far in 2018.

Munger, meanwhile, said Berkshire may have been "a little too restrained" in buying Apple, saying "it's reasonably priced and strong". "With the passage of time, we may own 6 or 7 percent because they repurchase shares".

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