If you own any stock in Apple, you’re probably aware that it’s been having a rough time on the stock market lately (it’s far from being alone in that regard). Apple is down a nauseating 40% compared to its all-time high back in October. If you do own Apple shares, you definitely don’t own as many as billionaire investor Warren Buffett. Warren’s conglomerate Berkshire Hathaway counts Apple as its largest single holding, owning some 252 million sahres. As of this writing, Apple accounts for 21% of its portfolio. That means any change in Apple’s stock price has an especially big impact on Berkshire’s stock price. Unfortunately for Berkshire shareholders and Warren himself as Berkshire’s largest shareholder, Apple’s 9% dip today (it was down as much as 14% today) removed around $4 billion from the company’s market cap.
That loss is entirely on paper, but the dip is another struggle for Buffett’s famous stock portfolio. Other big companies with significant investments by Berkshire Hathaway, like Bank of America, Wells Fargo, and J.P. Morgan, are all down double digits as well.
Berkshire was down 4.7% today on the Apple news. The stock is down 9% from a year ago.
It’s not known whether Apple’s recent performance has caused Buffett to rethink his widely reported enthusiasm for the company. He declined to comment to CNBC on the matter, but back in the early part of 2018 he put in no uncertain terms how he felt about Apple stock: “we buy them to hold.” He went on, in an interview on CNBC’s Squawk Box:
“We bought about 5 percent of the company. I’d love to own 100 percent of it. … We like very much the economics of their activities. We like very much the management and the way they think.”
Berkshire’s initial investment in Apple was back in February of 2017, a surprise to some given Buffett’s usual historic aversion to tech industry stocks. Back then, Apple was trading at around $129 per share, so all is well with that first big portion purchases, since now Apple is still trading above that line. But the rest of Berkshire’s shares were bought at prices that are higher than today’s price.
It’s also possible that Warren uses this dip as a buying opportunity. When he bought 75 million shares back in May 2018, Apple was trading at $185 a share. If he liked it at $185, he might LOVE it at $143 and go on a massive buying spree. Or maybe the world and markets have changed so substantially in the last 7 months that he’s not a buyer anymore? Keep an eye on the market. If Warren makes a large enough purchase, he’ll have to disclose it publicly.
As of this writing, a single share of Berkshire Hathaway Class A stock costs $288,340. That is not a type. If you want ONE share, it costs around the same as a high-end brand new Ferrari. The company’s top 5 holdings are:
#1) Apple – 252 million shares (current value $36 billion)
#2) Wells Fargo – 452 million shares (current value $20 billion)
#3) Kraft Heinz – 325 million shares (current value $14 billion)
#4) Bank of America – 680 million shares (current value $16 billion)
#5) Coca-Cola – 400 million shares (current value $18.5 billion)
Of those five stocks, only Coca Cola has gained in value since August 2018. Warren’s Coke investment is worth about $1 billion more today than it was five months ago. The other for stocks alone have lost a combined $25 billion SINCE AUGUST alone.
Warren’s track record since he started in 1964 is still nothing short of incredible. Had you invested $1000 with Warren Buffett back when he started, today (after adjusting for inflation and dividends) you would slightly more than $10 million!
But who could have been lucky/smart enough to invest with Warren back in 1964? Just ask Warren’s former neighbors Myer and Dorothy Kripkes
Source: Celebrity Net Worth