‘Technophobe’ Warren Buffett takes a $1bn stake in Apple

Billionaire invests in iPhone maker despite previously eschewing technology companies

Warren Buffett, chairman and CEO of Berkshire Hathaway: admitted four years ago he did not know how to value tech companies. Photograph: Kevin Lamarque/Reuters

Warren Buffett, chairman and CEO of Berkshire Hathaway: admitted four years ago he did not know how to value tech companies. Photograph: Kevin Lamarque/Reuters

 

Warren Buffett has taken a $1 billion-plus stake in Apple, just four years after admitting he did not know how to value technology companies like the iPhone maker.

Disclosure of the rare tech bet by the renowned value investor follows a one-third slump in Apple’s shares since last summer, and underlines Wall Street’s worries that the world’s most valuable company is facing a low-growth future.

Shares in Apple jumped 3.5 per cent to $93.67 early yesterday afternoon after Berkshire Hathaway, Mr Buffett’s holding group, divulged it had bought 9.81m shares in a regulatory filing.

Mr Buffett, a fan of inexpensive stocks with predictable cash flows, has long eschewed tech company investments out of concern that even the industry’s leaders might be undermined by fast-changing tech markets.

The disclosure comes days after revelations that Mr Buffett is backing a bid for the core business of Yahoo, suggesting a new interest in internet companies. Mr Buffett will provide debt financing to a consortium led by Dan Gilbert, the billionaire founder of Quicken Loans, according to people briefed on the Yahoo deal.

- (Financial Times Service)