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Apple Was Berkshire Hathaway’s Shining Star in Q1

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Apple

Berkshire Hathaway (BRK-B) was Apple’s (AAPL) second-largest shareholder at the end of the fourth quarter. While Berkshire Hathaway sold some Apple shares in the fourth quarter, it was by far the company’s biggest holding. Warren Buffett, Berkshire Hathaway’s chairman, clarified that he didn’t sell the Apple shares. A different investment manager sold the shares. Ted Weschler and Todd Combs are two of the other investment managers at Berkshire Hathaway.

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After a weak start in 2019, Apple had a reasonably strong first quarter. Apple saw an upwards price action of 20.9%. In the FAANG pack, Apple outperformed Amazon (AMZN) and Alphabet (GOOG) in the first quarter, while its returns trailed Netflix (NFLX) and Facebook (FB). Apple also outperformed the S&P 500 (SPY) and the NASDAQ Composite (QQQ) in the first quarter.

Warren Buffett

Buffett has received criticism for not adding more Apple shares in the fourth quarter. Berkshire Hathaway’s overall buying activity was subdued in the first quarter. The net buys were even less than the sequential quarter despite a fall in the markets. In an interview, Buffett said that Berkshire Hathaway was considering an acquisition opportunity in the fourth quarter. As a result, the activity in Berkshire Hathaway’s portfolio of publicly traded securities was low.

In the same interview with CNBC, Buffett said that Berkshire Hathaway’s average buying price for Apple “is about $141 or something like that.” In response to a question about whether he would buy Apple “at $160 or something,” Buffett replied that he wouldn’t. However, he said, “I’m always interested in lower levels in a number of stocks we own.”

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