Warren Buffett just disclosed a stunning billion-dollar bet on Apple
Berkshire disclosed that it owned 9,811,747 shares of the iPhone maker at the end of the first quarter. At the time, the position was worth $1.069 billion.
This position may surprise folks who’ve been following Warren Buffett, the chairman and CEO of Berkshire. Buffett has long been wary about investing in technology companies.
So is this an old man entering into the race late or the wise old man following the money?
Apple which makes most of its money on the sales of iPhones has long been a controversial stock for a number of reasons.
A few plus points
- It is the most valuable brand
- They do have superior technology
- Cash to spend
A few negatives
- Over paid executives and lavish plans
- Poor investments
They build well but buy badly
Apple currently spend around 30% of expenditure on R&D and my historical thumb suck check feels that this is in line with an innovative company continually scanning the digital world. The entry into Apple Pay, smart cars and other emerging trends are all signs of longer term survival.
My lesson on tech is the key attribute is timing. Apple has enough cash to get the timing right.
So is this a good move? … Time will tell
I have Apple shares which I will hold longer term, but certainly not to the extent the Oracle has!
Written by Allen on a rainy evening