Warren Buffett’s Apple bet yields $120B in on-paper windfall

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Billionaire investor Warren Buffett earned a massive on-paper windfall of more than $120 billion from his investment in Apple during its rise to an unprecedented $3 trillion valuation.

Buffett’s firm, Berkshire Hathaway, first purchased shares of Apple in 2016, when the iPhone maker was experiencing a brief downturn in its business. By 2018, the firm held a 5 percent stake in Apple at a cost of $36 billion.

Apple’s market valuation has climbed steadily since Buffett acquired the shares, briefly topping $3 trillion earlier this week. As a result, the value of Buffett’s Apple investment surged to $160 billion, an increase of more than $120 billion over time.

“Without a doubt, it is one of the strongest investments that Berkshire has made in the last decade,” said Edward Jones analyst James Shanahan told CNBC regarding the investment.

Apple was the first company in history to achieve a $3 trillion valuation. The company’s capitalization has since dipped slightly below the historic threshold.

Warren Buffett.
Warren Buffett’s firm, Berkshire Hathaway, first purchased shares of Apple in 2016.
Nati Harnik/AP

As of the end of September, Berkshire Hathaway owned a roughly 5.4 percent stake in Apple. The firm sold a portion of its shares in 2020. Apple is the largest holding in the firm’s portfolio.

Earlier this year, Buffett told investors at an annual shareholder meeting that the decision was “probably a mistake.”

Buffett has praised Apple’s leadership on multiple occasions, referring to CEO Tim Cook as a “fantastic manager.”

Tim Cook and Warren Buffett.
Warren Buffett has praised Apple CEO Tim Cook as “one of the best managers in the world.”
Twitter/tim_cook

“Tim Cook was under-appreciated for a while. He’s one of the best managers in the world. And I’ve seen a lot of managers. And he’s got a product that people absolutely love,” Buffett said earlier this year.

In 2020, Buffett told CNBC that Apple was “probably the best business I know in the world.”

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