Buffett shopping spree quadruples investor’s Apple stake

Legendary investor Warren Buffett, through his Berkshire Hathaway firm, has nearly quadrupled the company’s stake in Apple’s stock through a shopping binge during the final three months of 2016, according to a regulatory filing.

The investment firm increased its holdings in Apple stock to roughly 57.4 million shares as of the end of 2016, a filing with the Securities and Exchange Commission showed.

That was 3.8 times greater than the approximately 15.2 million shares of the iPhone maker that Berkshire Hathaway owned at the end of September, an earlier SEC filing revealed.

At the end of 2016, that Berkshire Hathaway holding was worth $6.6 billion. However, thanks to the rally in the tech giant’s shares so far in 2017, the holdings are now worth roughly $7.7 billion, a hefty gain of $1.1 billion in about six weeks of trading.

Cupertino-based Apple’s stock has soared 17 percent this year and climbed to an all-time record every day this week, including Wednesday.

Analysts believe the tech company’s prospects will only brighten.

Sales of the iPhone 7, along with the likelihood a future iPhone 8 will include significant upgrades over its predecessors, were the initial impetus for Apple’s surge into the stratosphere. Experts said significant innovations in the iPhone 8 will likely prod current iPhone owners to make a leap to the 8th version of the Apple smartphone. Disclosures of the Berkshire Hathaway purchases provided fresh fuel.

“We are increasingly confident in the outlook for Apple’s iPhone 8 cycle” Goldman Sachs analyst Simona Jankowski wrote in a research report this week. “As a result we are raising both our forecasts and our target price.”

Goldman Sachs raised its 12-month price target to $150 from $133 for Apple, accompanied with a “buy” rating.

UBS, another investment firm, stated that its 12-month target for Apple shares is $138 as part of a “buy” rating.

“We expect a bulge of iPhone 6 owners to upgrade in 2018, creating a strong year if not a ‘supercycle’ ” for sales, UBS analyst Steven Milunovich wrote in a note this week.

 

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