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Here’s how much Warren Buffett is up on his biggest stock bet

Here’s how much Warren Buffett is up on his biggest stock bet

Warren Buffett is one of the most famous investors of all time — and his reputation is well-deserved. The ‘Oracle of Omaha’ has managed to outperform the markets on a consistent basis. However, he didn’t achieve such renown through risky short-term investments — to the contrary, Buffett is the paragon of long-term value investing.

His approach is founded on a couple of simple tenets that have made his company, Berkshire Hathaway (NYSE: BRK.A), into an almost trillion-dollar business. Buffett prefers to invest in companies with an economic moat — some type of long-term competitive advantage. However, his main criterion is a reasonable valuation.

Although we tend to think of value stocks and growth stocks as two separate categories, by way of mean reversion, valuations tend to return to reasonable levels, at least on a long timeframe. In simple terms, undervalued stocks don’t stay undervalued forever — and that was the case with one of Buffett’s biggest holdings, Apple (NASDAQ: AAPL).

Apple stock has seen prices increase by 30.35% over the course of 2024, and was changing hands at a price of $242.70 at press time. Wall Street isn’t optimistic going forward — and the famed investor has steadily been reducing his stake in the company. Nevertheless, this was a big win for Buffett — let’s hone in on some more exact details.

AAPL stock price 1-year chart. Source: Finbold
AAPL stock price 1-year chart. Source: Finbold

Buffett has made a significant profit on Apple stock

Per Berkshire Hathaway’s latest 13-F filing made public on November 14, 2024, AAPL stock is the largest holding in the company’s portfolio — with the 300,000,000 Apple shares held by the business representing 26% of its total holdings.

Buffett first bought Apple stock in the fourth quarter of 2016. Although often criticized for being ‘late to the party’ with regard to tech, the billionaire has managed to secure a tidy profit from the consumer electronics giant.

At the time of his first purchase, AAPL stock was trading at an average price of just $24.91. Over the next seven quarters, the legendary investor steadily increased his exposure, although the pace of his acquisitions varied. By Q3 2018, the price of Apple stock had risen to $52.08.

What followed were five quarters where Buffett reduced his stake — at average prices ranging from $52.28 to $120.28. Finally, the billionaire started buying the stock again in Q1 2022, at a time when it was trading in the vicinity of $168 — Q1 2023 marked the last time Berkshire was a net buyer of Apple stock, which traded at an average price of $147.55 during the quarter.

Since Q4 2023, Buffett has sold more than 615 million Apple shares — and has certainly made a profit in the billions. Since Berkshire Hathaway does not publish the exact prices it acquired stocks act, it is impossible to determine exactly how large the gains were — Finbold used the average closing price of the cited quarters as a reference point.

Featured image via Shutterstock

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