Warren Buffett speaks during Berkshire Hathaway’s annual shareholder meeting in Omaha, Nebraska, on May 4, 2024.
CNBC
Warren Buffett sold a large part of his again Apple commitment, cuts Berkshire Hathaway‘s largest equity stake for four quarters in a row.
The Omaha-based conglomerate owned $69.9 billion worth of Apple shares at the end of September, according to its third-quarter earnings report published Saturday morning. That meant that Buffett lost about a quarter of his stake, while there were still about 300 million shares in the holding company. In total, the stake has fallen 67.2% compared to the end of the third quarter last year.
The Oracle of Omaha began reducing his stake in the iPhone maker in the fourth quarter of 2023 and increased sales in the second quarter when he surprisingly dumped almost half of the bet.
Apple, YTD
It’s unclear what exactly motivated the continued selling of the shares that Berkshire first bought more than eight years ago. Analysts and shareholders had speculated that this was due to high valuations and portfolio management to reduce concentration. Berkshire’s Apple stake was once so large that it took up half of his stock portfolio.
In May, Buffett hinted at Berkshire’s annual meeting that the sale was for tax reasons, as he speculated that capital gains taxes could be raised in the future by a U.S. government looking to close a rising budget deficit. However, the size of the sales led many to believe it could be more than just a tax-saving measure.
Berkshire began buying the stock in 2016 under the influence of Buffett’s investing lieutenants Ted Weschler and Todd Combs. Before Apple, Buffett largely avoided technology companies for most of his career, saying they were outside his circle of competence.
The legendary investor fell in love with Apple because of its loyal customer base and the stickiness of the iPhone. Over the years, he has grown his stake in Apple to become Berkshire’s largest company, once even calling the tech giant the second most important company behind its cluster of insurers.
Amid the big selloff, Berkshire’s cash hoard reached $325.2 billion in the third quarter, a record high for the conglomerate. The company completely halted buybacks during the quarter.
Apple shares are up 16% this year, following the S&P 500’s 20% gain.