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For Warren Buffett, Apple is his new Cola-Cola as the investing icon reaps $100 billion in six years


Warren Buffett is a multi-billionaire who says that he drinks 5 Cokes per day.

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Warren Buffett has had recent success thanks to his enormous wealth Apple bet is spurring comparisons with the legend’s greatest investment of all time — Coca-Cola.

Berkshire Hathaway started buying Apple stock in 2016. By mid-2018, he had acquired a 5% share of the iPhone maker. The purchase cost $36B. The tech company’s shares have soared and the market value has risen to over $160 billion. Buffett’s investment in Apple stock has amounted to a return of well above $100 billion. This is just six years.

Some Buffett observers were reminded of Coca-Cola as the Oracle of Omaha’s longest and oldest stock position. Buffett began buying stock in 1988 and the stock has increased more than 2,000%. It is still Berkshire’s fourth-largest equity position, with 400,000,000 shares.

Bill Smead (chief investment officer, Smead Capital Management) said that “Buffett has his Coca Cola moment” on Apple. He is also a Berkshire shareholder. Both went up in value over the first five to 7 years they owned them.

Buffett was known to have a hard time investing in high-flyers, such as Apple. However, this outlandish move proved to be Buffett’s best investment of the decade. Apple’s stake also played a crucial role in helping Berkshire weather the coronavirus pandemic as other pillars of its business, including insurance and energy, took a huge hit.

The 91-year-old investor has become such a big fan of Apple that he now considers the tech giant as one of the “four giants” driving his conglomerate of mostly old-economy businesses he’s assembled over the last five decades.

According to Edward Jones Berkshire analyst James Shanahan Apple has been “a success for Berkshire,” he said. “Buffett acquired most of the position at an average cost of about one fourth of the current market price.”

Apple’s stock-repurchase strategy allows for the conglomerate to grow its ownership with every dollar earned by the iPhone maker. Berkshire may have reduced the ownership, but the equity has increased from 5.27% to 5.43% by the end 2020.

In addition to regular dividends, which averaged around $775 millions annually over the years from the tech giant, the conglomerate has also been able to enjoy regular payments.

It wouldn’t surprise if one took cues form what Buffett stated when he bought Coca-Cola shares.

We made large purchases in 1988 of Federal Home Loan Mortgage, Coca Cola and other securities. Buffett said that they expect to retain these securities for many years. 1988 annual letter.We love to hold onto outstanding companies with great managements. When companies do well , we are not like those who rush to sell or book profits.