Warren Buffett [Berkshire Hathaway]
0 Facebook x .com Reddit
Famous investor Warren Buffett cut shares of his company Apple by 13% in the first quarter of 2023, as analysts agreed that iPhone demand was falling.
Buffett is not a long-term investor in Apple — his firm, Berkshire Hathaway, only started buying Apple shares in 2016 — but he became a particularly important shareholder. Warren Buffett also spoke to Steve Jobs and Tim Cook about the value of the company buying back its own shares, which it did again after its last earnings report.
However, as first noted by CNBC, Berkshire Hathaway's own first-quarter earnings report shows that the company cut its stake in Apple by 13% during the period. Apple remains Berkshire Hathaway's largest asset, valued at about $135.4 billion.
During the first calendar quarter of 2024, analysts consistently downgraded Apple, in part due to falling demand for the iPhone in China.
JP Morgan, for example, lowered its price target and said that while Apple would get a boost from introducing AI features into the iPhone, it wouldn't do so until 2025 and the iPhone 15. Morgan Stanley insisted on this. that the company remains bullish on Apple while reducing its stock price.
Apple's earnings report on May 2, 2024 confirmed that iPhone sales in China have declined markedly — but not as bad as the 25% decline some are predicting. In part due to poor sales forecasts from analysts who booked losses in the stock before earnings, Apple's share price rose sharply after the earnings report, driven by the company's resilience in the mix of hardware and software and the promise of soon-to-be-arrived artificial intelligence features. .
As a result, most analysts have changed their minds about whether investors should buy Apple shares. Morgan Stanley was the first to raise its price target again, although its new $216 target is still lower than it was at the start of the year.
However, there are signs that Warren Buffett's strategy for Apple may not be related to short-term problems with the stock, but instead is part of the company's shift away from technology companies. The first calendar quarter of 2024 marked the second quarter in a row that Berkshire Hathaway sold Apple shares.
In the fourth quarter of 2023, an investor sold 10 million shares of Apple. This was estimated to be about 11% of its total stake at the time.
Buffett has shorted Apple shares before, although he said in 2021 that the recent round of stock sales was “probably a mistake.”
Follow AppleInsider on Google News.
