Warren Buffett sells Apple stock, buys more Berkshire stock believing it's undervalued

From Nasdaq: 2024-06-15 05:12:00

Warren Buffett, CEO of Berkshire Hathaway, made major investment decisions including selling 116 million shares in Apple, reducing its stake by 13%. Apple still makes up 40% of Berkshire’s $336 billion portfolio. Despite selling Apple, Buffett bought more Berkshire stock, believing it’s undervalued and has outperformed the S&P 500 for 22 consecutive quarters.

Apple’s strong brand authority and pricing power contribute to its success. iPhone dominates the smartphone market with 20% of shipments. The company’s ecosystem and services are key revenue drivers, with services growing more quickly and earning higher margins. Apple reported decreased revenue in Q2 due to lower iPhone sales offset by higher services sales.

Berkshire Hathaway, purchased back $2.6 billion worth of its own shares in Q1, totaling $9.2 billion in buybacks in 2023. Buffett believes Berkshire’s stock consistently trades below its intrinsic value, making it a compelling investment. Berkshire’s diverse portfolio of essential businesses has historically outperformed the S&P 500, earning better returns with lower risk of capital loss.



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