Warren Buffett speaks during the Berkshire Hathaway Annual Meeting of Shareholders in Omaha, Nebraska, on May 4, 2024.
Coincidence or master plan? Warren Buffett now owns exactly the same number of shares of Litter how he does Coca Cola after reducing the technological share by half.
Many Buffett followers made the curious observation after a regulatory “13-F” filing Wednesday night revealed Berkshire Hathawaystock holdings at the end of the second quarter. It showed an identical count of 400 million shares in Apple and Coca-Cola, Buffett’s oldest and longest-running stock position.
This has led some to believe that the “Oracle of Omaha” has finished selling his stake in the iPhone maker.
“If Buffett likes round numbers, he may not be planning to sell any additional Apple shares,” said David Kass, a finance professor at the University of Maryland’s Robert H. Smith School of Business. “Just as Coca-Cola is a ‘permanent’ holding for Buffett, so too may Apple be.”
The 93-year-old legendary investor first purchased 14,172,500 shares of Coca-Cola in 1988 and increased his holdings in the following years to 100 million shares by 1994. Thus, the investor kept his stake in Coca-Cola stable, essentially at the same round share count, for 30 years.
Due to two rounds of 2-for-1 stock splits in 2006 and 2012, Berkshire’s stake in Coca-Cola now stands at 400 million shares.
Buffett said he discovered the iconic soft drink when he was just 6 years old. In 1936, Buffett began buying six Coca-Colas at a time for 25 cents each from his family’s grocery store and selling them to his neighbors for five cents more. Buffett said it was then that he realized the “extraordinary consumer appeal and commercial possibilities of the product.”
Cutting Apple’s stake
Investing in cutting-edge technology companies like Apple may seem to defy Buffett’s long-held value investing principles, but the famed investor treated the company as a consumer products company like Coca-Cola, not as a technology investment.
Buffett has touted the iPhone’s loyal customer base, saying people would give up their cars before they would give up their smartphones. He even called Apple the second most important business after Berkshire’s insurance group.
So it came as a shock to some when it was revealed that Berkshire sold more than 49% of its stake in the iPhone maker in the second quarter.
Many suspected it was part of portfolio management or a broader view of the market, rather than a judgment on Apple’s future prospects. The sale reduced Apple’s weighting in Berkshire’s portfolio to about 30%, from nearly 50% at the end of last year.
And with that round number set, it appears to be in a position Buffett prefers for his most beloved and longest-held stocks.
Still, some said it could just be a pure coincidence.
“I don’t think Buffett feels that way,” said Bill Stone, chief investment officer of Glenview Trust Co. and a Berkshire shareholder.
But at Berkshire’s annual meeting in May, Buffett compared the two and mentioned that the holding period for both was unlimited.
“We own Coca-Cola, which is a wonderful business,” Buffett said. “And we own Apple, which is an even better business, and we will own, unless something really extraordinary happens, we will own Apple, American Express and Coca-Cola.”
