Warren Buffett’s Berkshire Hathaway Inc. reportedly has amassed a $79 billion stake in Apple Inc. since early 2016.
The stake’s value has more than doubled to $79 billion since he began buying, the Wall Street Journal reported.
Apple (AAPL) now accounts for about 14% of Berkshire’s market capitalization, more than any other single stock in its portfolio, the Journal reported.
“Berkshire spent about $36 billion on its Apple stake, the company said in its 2018 annual report. That exceeds the roughly $32.7 billion Berkshire paid to buy Precision Castparts Corp. in 2016, its biggest-ever acquisition,” the Journal said.
Apple became the world's first company to record a market capitalization of $1 trillion, and subsequently passed the $1.3 trillion threshold in December.
Apple stock continues to set various record highs, seemingly on a daily basis. Over the past year, the stock has more than doubled, far eclipsing the rise of the S&P 500.
Early Friday, Apple's stock price was at $317.85, down $2.45, or 0.76%.
The WSJ report comes just days before Berkshire is set to release its 2019 results and Buffett’s annual letter to shareholders on Saturday.
Investors monitor Berkshire's quarterly filings, earnings and Buffett's letter to see where Buffett and his portfolio managers Ted Weschler and Todd Combs, who is also chief executive of Berkshire's Geico car insurer, see value.
“Mr. Buffett started to study Apple after one of his portfolio managers, either Ted Weschler or Todd Combs, bought about $1 billion in Apple shares for Berkshire in early 2016. As he studied the company and questioned his great-grandchildren about their allegiance to Apple products, Mr. Buffett decided Apple was a retail company he could understand,” the Journal said.
Berkshire sold a small percentage of its Apple holdings between mid-2018 and the end of 2019, according to securities filings. Those sales were made by either Weschler or Combs, who manage a fixed amount of money for Berkshire, a person familiar with the investments told the Journal.
The Apple news also comes a week after it was reported that Berkshire has taken a $549.1 million stake in Kroger Co., investing in the largest U.S. supermarket chain as smaller rivals struggle.
In a regulatory filing detailing its U.S.-listed investments as of Dec. 31, Berkshire also said it took a new 648,000 share stake in drugmaker Biogen Inc. (BGEN) worth $192.4 million, and significantly reduced its stakes in two major banks, Wells Fargo & Co. (WFC) and Goldman Sachs Group Inc. (GS), Reuters explained.
Berkshire has sold more than 86 million shares, or 21%, of its Wells Fargo stake since June 30, as the bank tries to restore its reputation following scandals over its mistreatment of customers.
Since the scandals began erupting in September 2016, the Standard & Poor's 500 has risen 55%, while Wells Fargo is down 3%. Berkshire began investing in Wells Fargo in 1989.
The recent filing didn't say who bought or sold particular stocks, though Buffett normally directs big investments such as Wells Fargo and Apple.
Here’s some other key takeaways from Berkshire’s 13F:
- Berkshire disclosed two new exchange-traded fund holdings, in Vanguard S&P 500 ETF and SPDR S&P 500 ETF Trust. The bets were small investments, totaling $25 million across both.
- Buffett’s company ramped up its bet on Occidental Petroleum Corp., bringing that investment to $780 million. Berkshire also owns preferred stock in the oil producer, which Buffett obtained as part of a deal to help Occidental in its pursuit of Anadarko Petroleum Corp.
- Berkshire also increased its stakes in furnishings retailer RH, Suncor Energy Inc. and General Motors Co.
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