Warren Buffett buys more Apple, says iPhone is ‘enormously underpriced’

“The Oracle of Omaha is adding to his already large stake in Apple Inc,” Katherine Chiglinsky and Ivan Levingston report for Bloomberg. “Warren Buffett, 88, likes the technology giant because of its devoted customers, and has built up his stake in the company by ‘just a little’ since his last regulatory filing, he said Thursday in an interview with CNBC.”

“For customers, ‘the iPhone is enormously underpriced’ compared with the utility it offers, he said,” Chiglinsky and Levingston report. “Berkshire has been piling more money into Apple, increasing that stake to 252 million shares as of June 30. The investment is worth more than $50 billion and makes Berkshire the third-biggest shareholder in Cupertino, California-based Apple, with a more-than 5 percent stake, according to data compiled by Bloomberg.”

Read more in the full article here.

MacDailyNews Take: AAPL itself is enormously underpriced, as well.

55 Comments

  1. this is the realistic news i want to hear, not apple is doomed and gloomed by the parasite anal cysts and manipulators. Great job by Warren Buffet and a vote of Confidence for Apple

    1. Calling news “realistic” and naming it the type you “want to hear” is so comforting, I bet. You’ve asked yourself how do you really know it’s realistic or true?

      The phone is “underpriced” and you know for sure that true? Doesn’t that translate to iPhone priced at $1300 or $1500… how’s $1799?

      How do you balance your conclusion with the recent articles that stated the higher price iPhone makes up lower revenue b/c lower unit sales, but higher prices aren’t sustainable with the overall smart ph market slow down?

      By the way, I’d love for their price to have room for upward growth and my challenge doesn’t mean that I hate Cook or think Apple sucks…but pandering fanboyism is annoying.

      1. “ENORMOUSLY” It took a reread to see this word related to being underpriced. Forget $1799. Do I hear, $2399?

        Not only is fanboyism annoying, mindless fanboyism is ridiculous. Can I get you a blanket Snoop Dog, so you’re more comfy?

        1. Ya, totally. Snapped Dog 2 is a dick. If I bothered to remember posters at this website, I would know his other “handle”. Lot of pessimists here, it seems. A bunch of sore losers, if you ask me. If that had any brains at all, they would have been long Apple a long time ago.

      2. you’all are missing his point.

        he’s saying it’s underpriced given how useful it is.

        as a comparison, he says iPhones are more useful to people than his plane is to him (which he spend $1m a year to use)

        1. paying more, maybe a lot more, is logical, rational and likely expected. He, Mrs Buffet, in including price with the discussion and, if he’s positioning the thought as you note, enormously higher prices make sense. It’s not that complicated.
          Call it $1k, add enormous increase and one has a very, very high priced phone. This is a conversation, assumably, with tech current levels. Add VR and AR and the conversation changes immediately.

    2. Ridiculous!

      At the enormous scale Apple sells phones and buys components it SHOULD BE less expensive by now, not MORE expensive.

      As other posters noted, eventually there will be a saturation market slowdown and not sure of selling less higher priced phones will fill the gap …

      1. Ya, totally. Snapped Dog 2 is a dick. If I bothered to remember posters at this website, I would know his other “handle”. Lot of pessimists here, it seems. A bunch of sore losers, if you ask me. If that had any brains at all, they would have been long Apple a long time ago.

        1. Weiner-less guard dog? Roof.

          Did you have a point, or do you wish to be a cream-puff thinker like the Snapped Dog where nothing new is said and the only Apple News that’s to be presented in the affirming type?

  2. Let’s see…
    A 5% shareholder says the iPhone is underpriced….
    No room for cynicism there.

    Where’s the alternate question? How fairly are other phones priced for the value they provide?

    How about… they should all cost less?

    1. And what would satisfy you?
      A 25% reduction? 50%?

      For a business a recration tool that many people use for hours every day.
      For something that GREATLY increases my productivity… i.e. a LOT more money in my pocket than I paid for the phone.

      But go ahead – complain about a couple of hundred dollars here or there.

      Of course, the truth is that even if the prices were 50% of current, you’d still whine.

        1. “As a consumer I am on the opposite end of the table from anyone from who I buy”.
          Interesting expression of your fundamentally negative stance, which permeates just about every comment you make. It is just an attitude… not some fundamental law of physics. In carrying out my business, I certainly do not see myself in opposition to my customers. We win best when our customers win.

          “It’s as fundamental as supply/demand”
          The laws of supply and demand seem to manifest in an ENORMOUS number of people who buy Apple, are happy about their choices, and who don’t incessantly whine about it.

          1. I’ve felt gypped by Microsoft from time to time, and misused by Apple from time to time. I consider myself a normal technology consumer, so I normally would contact customer service to air my complaints. But in the last two years or so I have discovered the joy of gnashing my teeth publicly. It’s such a rush doing that here at MDN that it became an addiction. It is positively liberating; like primal scream therapy, yelling at the corporate imbeciles making decisions that inconvenience me or insult my delicate design sensibility. I know I can count on lots of support, as long as I attack. After venting here in this forum, I usuually go take a shower. Later, I might go to confession. But, you know, it feels good denouncing people.

            1. There’s nothing like gnashing of teeth in a public venue, huh?

              Is it just a human thing in general, or is it a cultural thing that’s pretty energetic these days?

              What’s the solution?

              Going to confession is a good thing, but doesn’t necessarily break the cycle.

              Should I just turn off?
              Or should I learn to be clever with jabs so the denouceation is more subtle? Maybe I should just care less?

          2. “The laws of supply and demand seem to manifest in an ENORMOUS number of people who buy Apple, are happy about their choices, and who don’t incessantly whine about it.”

            So how are the happy sales of a five year old seriously outdated and industry behind Mac Pro and the neglected soldered shut years old Mac Mini? Apple is very selective about giving love to certain products and allowing many others, mainly Macs, to rot on the summer vine. Blind fanboys need to remove the rose colored glasses …

            1. blind fanboys, broken record, knee jerk, grow up… I love what you consider YOUR adult exchange.

              But anyway… you didn’t address the point… nor do any of the incessant whiners… Seriously, why do you spend YEARS whining and complaining rather than just go and buy other products?

        1. Problem with your theory is that Buffett buys and holds long term. That’s his fundamental strategy and he’s right a lot of the time. When asked why others don’t copy his strategy he said “Nobody wants to get rich slow.” If Buffett is buying more AAPL you can make a good bet it’s because he thinks Apple is going to grow significantly over the next decade or so. He is usually right.

            1. you don’t. God forbid Buffett is buying AAPL because it is a good and sound investment based on smart fundamentals and his years of business knowledge and experience. No, it couldn’t be that because we know from your ilk that Apple is doing everything wrong and is doomed to fail so Buffett could only be attempting to juice the stock and he secretly knows Apple is doomed just like you do.

            2. Well, I was accused of having one.
              However, Buffet’s comments are indeed peppered with self interest, and it’s almost certain the stick will at least temporarily spike on his statements.

              God forbid you might evaluate aspects other than those you like.

            3. you weigh all sides and form an idea based on evidence. I’ll go with Buffett and his decades long track record of buying and holding stocks in businesses he sees as fundamentally sound and good long term investments. I’m confident I can dismiss the ravings of someone who calls themselves applecynic on a fan site. Thanks though.

            4. I’m fine with opposing opinions. That isn’t what you have. You have ravings based in fantasy not opinions that can be taken seriously. Run home little fan boy.

            5. To be a fanboy I must first be a fan, but don’t let facts stop you.

              Buffet either is
              A) As you say
              B) As I said for consideration
              C) Some combination of both

              Didn’t even think of telling me there’s no self interest on Buffet’s part. Then why did he say it? The purity of his heart or the fallacy of you convictions? Huh fanboy?

            6. Buffett said what he said because he has a long track record of telling it like it is. All he’s doing is telling the truth. All you’re doing is putting your spin on it. Spin spin spin little fan boy.

            7. I never said the market doesn’t react. I said Buffett is just telling the truth about Apple. The iPhone is underpriced for the utility it delivers. Apple is going to continue to grow and the stock is a smart long term investment. Why does that upset you?

            8. You did not say Buffett’s comments may be self serving. You said “Buffet’s comments are indeed peppered with self interest”. Are. Not may.

              Let the backpeddling begin.

              Then I said it was much more likely that Buffett was just telling the truth about Apple and that was based on his decades long track record of doing exactly that with many other investments. Try to keep up fan boy.

            9. You don’t listen very well. I answered your question about why Buffett would make these comments. More than once in fact. Buffett is just telling the truth about Apple. He has a long track record of making truthful comments about the companies he invests in.

  3. WB 2017: what’s an iPhone? What does it do that my candy bar phone can’t do. I just love my candy phone. It’ll do me.

    WB 2018: it’s a phone, it’s a Walkman, it’s a camera, it’s a video player, it’s a GPS, it’s an internet machine, it’s a conferencing device, it’s a book reader, it’s a …… Wait, that’s $100+200+1000+1200+……. It’s underpriced!

  4. Careful…
    Buffett is a capitalist, not a consumer.
    When the super hyped up iPhone X “super cycle” did not happen (though a top seller during Holiday Season) and the sales dropped below that of 8/plus (mind you, Tim Cook was still saying that X was selling “through the roof” etc. What a guy!), another outlet asked Buffett if he was not concerned about it.
    His reply was that he did not care much about the sales volume etc, and only interested in and impressed by Apple’s “profitability”. This is a correct answer as an investor. So, he will continue to invest in Apple as long as Apple can maintain its pricing strategy, even if the net sales amount might be lower. He is not bothered by that. But the moment he sees the sign of difficulties by Apple to charge high price, I am sure he will get out in no time. Until then, he will continue to say iPhone is “enormously underpriced”. Really? Just take a pause to think about this outrageous comment, “ENORMOUSLY UNDERPRICED”. Savvy Buffet is sensing the beginning of iPhone price hitting the ceiling, and trying to offset the possible drops. Apple knows it too and reducing the price this year.

      1. Wouldnt you just love that!… all those scumbag investors will get what they deserve right ?
        If u did not profit.. why should they right….. “all investors are bloodsucking scums…” right?.. ( just quoting your own petty posts Artist )

        There are Those who go out to the wilderness, take risks and hunt .. and there are those who sit home and scratch their jewels…… they both deserve the same meal … right!?
        Dingleberry !

      2. Attn: John Dingler, fartist

        Monday was a market holiday, so you were wrong about that the second you typed it. Today is Tuesday and Apple is up while the market is down. Where’s the “DUMP” you predicted. I know, just like the goofballs who predict the rapture, or that the world will end on such-and-such a date—you know nothing. But love to spout off.

  5. Spoken like a true billionaire who owns stock in the company. I’m sure Warren is aware of the margins Apple already enjoys with its products. But there can never be too much profit for a capitalist. Anyhow, I digress; we should focus on Warren’s understanding of the technology sector. Keep in mind that Warren was bullish on IBM too. How did that work out for him?

    1. The beautiful thing about free market capitalism is one can voluntarily buy an expensive phone or one can voluntarily buy a cheaper phone. Ultimately, it’s the market that determines price.

      1. Exactly.
        I pay for whatever products I like. If the product is good, I am even prepared to pay hefty premium even if it may not be justified in my mind. And that’s how I have been buying iPhone from its first iteration until last year.
        I may finally buy an X this year if the FID is a bit speedier and more accurate etc.
        I just do not want to be hyped up to buying into something that “I” think would not deserve the hype. And I definitely felt that Apple has changed in the last several years since TC took over the CEO position. Apple products always carried some premium price, which did not bother me much, as they were good products. Now in the Tim Cook’s world, it’s all about the money and profit, at which people like Buffett is delighted. But where was the mojo of “pleasing consumers” disappeared into? That’s all. But he seems to have learned the lesson, and coming up with a bit saner pricing and more products he was keeping in his pipeline. Let’s hope so.

  6. Deutsche Bank keeps price target at $175. Figures that’s what Apple’s fair value is worth. What does Buffett know? There are probably plenty of people who think Buffett is senile because he’s buying Apple stock.

    Apple will soon be worth less than Amazon and remain enormously undervalued while Amazon’s value soars to the heavens and maybe even becoming the first $2T company. Apple had a chance to become the most wealthiest company on the planet by a longshot but missed the opportunity by not making major acquisitions with all that cash it was slowly hoarding. Apple should have really snatched up some cloud computing company because that’s all Wall Street praises when it comes to unlimited growth markets. iPhone sales and services isn’t enough to excite Wall Street so Apple is still said to be much riskier than any of the FANG stocks. Trillion-dollar value or not, Apple is still doomed. Doomed to staying enormously undervalued by Wall Street.

    1. “missed the opportunity by not making major acquisitions with all that cash it was slowly hoarding.”

      Totally agreed. I was always wondering why Timiddy Cook did not do that when he had a chance and enormous resources, big enough to even gamble. Instead, he has been acting like a little bean counter or a poor little kitty, busy trying to milk us with one pony trick (phone business), always fine tuning pricing and inventory control etc etc using his earned skill of what is called “supply chain management”?!%$?. He does not have a forward thinking, nor bold (and well calculated) attitude toward fututre investment to grow Apple on a long term. Forget about playing with money sucking autonomous car etc. Let Elon Musk handle it. Timiddy is totally happy playing a little game from inside of cozy iPhone cocoon.

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