Warren Buffett Buys $1 Billion Stake In Apple (cnn.com)

An anonymous reader quotes a report from CNN: Berkshire Hathaway, the conglomerate run by Buffett, disclosed in a regulatory filing Monday that it purchased more than 9.8 million shares in Apple during the first quarter. It marks Berkshire's first investment in Apple. Berkshire acquired its position at an average price of about $109 a share. Apple's stock price has since fallen to just above $90, meaning that Berkshire's stake in Apple is now worth about $888 million. The Apple purchase is the second big tech investment by Berkshire, which has been steadily adding to its stake in IBM during the past few years. Until recently, Buffett had been famous for his lack of investments in the tech sector. But Apple fits perfectly in Buffett's wheelhouse. The company is a leader in its market and the stock is extremely cheap, trading for just 11 times this year's earnings estimates. Apple also has a pristine balance sheet, with $232.9 billion in cash. At the end of April, billionaire investor Carl Icahn sold his entire stake in Apple, citing the risk of China's influence on the stock. Last week, Didi, China's ride-sharing service and rival to Uber, announced Apple invested $1 billion in the company. There's been a lot of money shuffling taking place as of late as Apple tries to reinvigorate the market after it had its first earnings decline in more than a decade.

Comments

Very surprised

[140Mandak262Jamuna]

I have resisted buying Apple stock from day 1. I saw the original iPad with 20GB or 40GB hard disk and a wheel and four buttons, I knew it was a hit. Still stuck to my "never an individual stock. Always funds. Always index funds". Finally I see decline in AAPL, and finally coming around to feeling smug, "ha! I knew I was right not to buy the stock". While my bandwagon friends are laughing at me, they can unload it after it loses another 20% and still will beat my great index fund strategy. Now, Apostle of Value, the one who never buffeted by winds of change, the guru from AUMaha, is jumping in?

Well, that is why he is a billionaire and I am a code monkey.