“One word may explain Warren Buffett’s investment decisions on Apple and Amazon: profit,” Tae Kim reports for CNBC. “Last week Buffett both lamented on not investing Amazon shares and revealed how he added massively to Berkshire Hathaway’s stake in Apple.”
“The Oracle of Omaha’s moves may be explained by his philosophy of emphasizing a company’s historical financial track record versus putting credence in aggressive future forecasts from analysts,” Kim reports. “‘I think it’s fair to say, we’ve never looked at a [analyst] projection in connection with either a security we’ve bought or a business we’ve bought,’ Buffett said during a Berkshire Hathaway annual shareholder meeting in 1995, according to remarks found using CNBC’s Warren Buffett Archive.”
Apple “generated a $48.35 billion in profit during its fiscal 2017 and made $13.8 billion in net income during the March 2018 quarter,” Kim reports. “In comparison, Amazon’s total net income since inception is about $9.6 billion.”
Read more in the full article here.
MacDailyNews Note: Apple’s P/E ratio is 18.19. Amazon’s is 201.78.
[Thanks to MacDailyNews Reader “James M. Gross” for the heads up.]