Warren Buffett is the most respected person in stock circuits and his Berkshire Hathaway Inc. alone is capable of creating ups and downs at the Wall Street.
In Q4 of 2016, he aggressively bought shares of Apple Inc. nearly quadrupling the stakes he already had in the company. By the end of Q3, Berkshire was having only 15.2 million shares, which by the end of Q4 rose to 57.4 million amounting to $7.74 billion. It was not only Apple that he bit on, he was also bullish on the stocks of four biggest airlines of the US and increased his holding in them nearly seven times. It was reported by Berkshire that it invested $2.1 billion in each of these namely American Airlines Group Inc., United Continental Holdings Inc., Southwest Airlines Co., and Delta Air Lines Inc.
Besides investing in airlines and Apple shares, the company also took stakes in Sirius XM Holdings Inc., which is a satellite radio company and Monsanto Co., which is bought by Germany’s Bayer AG. Most of these stakes are bought by Berkshire after the declaration of new President of US in November and till the end of January.
This 86-year-old billionaire normally averts to invest in technological companies citing the reason that these are outside his competence zone, thus making huge investments in Apple is surprising.
Thomas Russo who is responsible for $11 billion of assets, which includes 12 percent in Berkshire said, “I’m stunned to see the size of that Apple position. It’s quite possible that Warren woke up and began to understand the virtues of Apple that he had been neglecting or, like with Precision Castparts, Todd or Ted had an affinity for Apple that sparked interest from Warren.” With the recent investment, Berkshire now becomes one of the 10 biggest investors in Apple.
It is believed that the initial investment in technological companies was the work of either Combs or Weschler both of whom are leading candidates to succeed as chief investment officer in Berkshire after Buffet. On investment in airlines stocks, Buffett told in an interview to Charlie Rose last month that it was primarily his decision.
The shares of all the airline companies and Apple rose after the news of Berkshire raising stakes in them became public.