Warren Buffett’s Apple stake plunged in value by $10 billion during Thursday’s tech rout

  • Warren Buffett’s Berkshire Hathaway saw the value of its Apple stock tumble $US10 billion during the tech sell-off on Thursday.
  • Apple’s stock price dropped 8%, slashing the value of Berkshire’s roughly 981 million shares in the tech titan to below $US119 billion.
  • Berkshire has still more than tripled the value of its Apple investment, as it spent about $US35 billion to build the 5.7% stake.
  • Its Apple stake is still worth more than the market capitalisation of IBM, Citigroup, or Starbucks.
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Warren Buffett’s Berkshire Hathaway saw an astounding $US10 billion wiped off the value of its Apple stock during Thursday’s tech rout.

The famed investor’s conglomerate owns close to 981 million Apple shares following the recent four-for-1 stock split, giving it a 5.7% stake in the iPhone maker.

Apple’s stock price tumbled 8% on Thursday, slashing the tech titan’s market capitalisation by $US178 billion. The decline cut the value of Berkshire’s stake to less than $US119 billion, almost $US17 billion below its $US135 billion peak, when Apple shares hit a record high, on Wednesday.

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However, Apple stock is still up 61% this year. Its outperformance reflect unprecedented efforts by the US government and Federal Reserve to keep markets afloat, the boom in day traders with an insatiable appetite for tech stocks, and robust demand for Apple’s products and services as consumers seek to stay informed, entertained, and productive during the pandemic.

Berkshire remains heavily in the green on Apple, the biggest holding in its stock portfolio. It spent about $US35 billion to build the position between 2016 and 2018, meaning it has still more than tripled the value of its investment. However, its current $US83 billion gain is well below the $US100 billion level it briefly hit on Wednesday.

Still, Berkshire’s $US119 billion in Apple stock is worth more than the entire market capitalisation of IBM ($US111 billion), Citigroup ($US107 billion), or Starbucks ($US101 billion). It’s also more valuable than Buffett’s personal fortune of about $US83 billion,according to the Bloomberg Billionaires Index.

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Moreover, Berkshire’s Apple stake represents almost 23% of Berkshire’s $US521 billion market capitalisation. That’s striking because Berkshire owns scores of companies including Geico and See’s Candies, it boasted $US390 billion in net assets at the last count, and Apple is just one of the more than 40 holdings in its equity portfolio.

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