The legendary investor and billionaire Warren Buffet, has admitted that selling shares of Apple was probably a mistake, reported the Financial Express. Buffet said he decided to sell the shares despite the caution from Berkshire Hathaway Vice Chairman Charlie Munger.
“I sold some stock last year, although our shareholders still had their percentage interest go up because we repurchase shares. But that was probably a mistake,” said Warren Buffett, the Financial Express reported.
The remarks came at Berkshire Hathaway's annual shareholder meeting earlier this month.
Berkshire Hathaway sold 37 million Apple shares, which pocketed the large holding company $11 billion. By the end of 2020, Berkshire Hathaway still held 907 million shares of Apple.
Warren Buffet had bought his first 10 million shares of Apple in 2016, but gradually increased his stake in the company to $36 billion. The CEO of Berkshire Hathaway had long been averse to investing in tech companies.
Now his company owns a little over 5 percent of Apple's total shares, the value of which was a little over $120 billion, at the end of 2020. Apple's shares have seen a 400 percent increase in the last five years, seeing an 83 percent jump last year itself. Apple is worth over two trillion dollars, the report mentioned.
“I do want to emphasize that in his own way, Tim Cook has handled the business so well,” said Buffett while discussing Apple’s business, according to the report.
"Tim understands the world to a degree that very, very few CEOs I've met over the past 60 years could match," Buffett told Bloomberg in an early February interview.
"Our cost for that stake was $36 billion. Since then, we have both enjoyed regular dividends, averaging about $775 million annually, and have also — in 2020 — pocketed an additional $11 billion by selling a small portion of our position. Despite that sale — voila! — Berkshire now owns 5.4% of Apple,” Buffett had explained in a letter to the shareholders, the Financial Express report mentioned.
Berkshire Hathaway's stake in Apple was increased without any additional cost, from share buybacks by Apple and Berkshire’s own share repurchases over the last two years. The Apple shares now represent about 42 percent of Berkshire Hathaway's investment portfolio and all of them are directly owned by the company and not by CEO and Chairman Warren Buffet, according to the CBS News report.
