Warren Buffett sells Apple stock due to high valuation, buys Domino's Pizza instead

From Nasdaq: 2024-11-24 06:50:00

Warren Buffett sells over $20 billion worth of Apple stock in the third quarter, reducing Berkshire Hathaway’s position to $70 billion. The move is likely due to Apple’s high valuation, with a P/E ratio of 37 and minimal revenue growth in recent years. Meanwhile, Berkshire Hathaway acquires a 3.5% stake in Domino’s Pizza, attracted by the company’s growth potential and capital-light franchising model.

Buffett’s decision to trim Apple shares is driven by the stock’s high valuation and minimal growth, leading him to shift focus to companies with better growth potential like Domino’s Pizza. Despite Apple’s success, the stock’s current price does not align with its growth prospects, prompting Berkshire Hathaway to diversify its portfolio.

Domino’s Pizza presents a more attractive investment opportunity than Apple, with a lower P/E ratio and strong growth projections. The company’s capital returns program, including dividend growth and share repurchases, further enhance its appeal to investors. Berkshire Hathaway’s move to acquire a stake in Domino’s reflects confidence in the company’s long-term prospects and growth potential.

Investors are advised to consider opportunities like the “Double Down” stock recommendations, which identify companies poised for significant growth. Examples of past successes include Nvidia, Apple, and Netflix, which have delivered substantial returns over time. By exploring these opportunities, investors can potentially capitalize on future market trends and secure profitable investments.



Read more at Nasdaq: Warren Buffett Keeps Dumping Apple Shares: Here’s the Stock He Is Buying Instead