Is this the reason genius Warren Buffet bet nearly half of his wealth in Apple stock?

When Covid-19’s influence on the United States was at its worst, Tim Cook and the ministry received a special news: Apple capitalization reached a peak of 1.6 trillion USD. So far, no other technology giant has been able to achieve this “massive” number.

Among the major Apple shareholders is a famous billionaire: Warren Buffet. Currently, Apple stock accounts for 43% of the total value of Berkshire Hathaway’s portfolio of companies he founded. This is a huge increase when the billionaire just started investing in Apple 4 years ago (early 2016). Last February, Buffett declared Apple “the best business I know in the world”.

And behind the confidence of the world’s most famous investor is also the reason why rivals must really worry about steps Apple has NOT taken.

Apple is the most successful investment of the “prophet of Omaha”.

First of all, you need to understand that equity investment is game of sa lai rather than the present. Put simply, no matter how big a stock is, it doesn’t make sense if you can’t sell at a price higher than the purchase price. The fact that Warren Buffet buys and holds a large amount of Apple stock (currently worth $ 89 billion) shows that Apple’s stock price will still rise. In other words, he believes that Apple will be even more powerful in the future.

Obviously, talking about the future is about things Apple has NOT done, or in other words, steps that CAN take at any time but save the appropriate time to strike. Good examples are iPhone 6 and 6 Plus. In the early 2010s, demand for large-screen iPhones was immediately increased after Android vendors (typically Samsung) pioneered the phablet war. But while Android has been 5 inches since 2010/2011, Apple waited until 2014 to have a 4.7-inch iPhone.

You may think Apple is slow, but the truth is Tim Cook has read the market very accurately. In the years from iPhone 4 to iPhone 5s, users have craved for a big screen but still do not give up Apple. IPhone sales continue to grow year by year. It was not until the demand became fierce that Apple hit the mark and immediately achieved huge success: iPhone sales in late 2014 soared, Apple even surpassed Samsung to occupy the No. 1 market. school. A few months later, Apple was also the first to reach $ 700 billion in market value.

Is this the reason genius Warren Buffet bet nearly half of his wealth in Apple stock | Phone

Tim Cook’s wisdom shows through his slow, timely steps.

Many other steps of Apple are similar in color, when Apple is not in a hurry to release all that it has but slowly step by step firmly. For example, this year saw the year Apple saw the mid-range with the iPhone SE cost $ 400. At this price, the latest iPhone shows the special attraction of Apple smartphones in the low-cost segment when selling up to 1 million units in China in the middle of the season. But if the SE strategy is so right, why would Apple wait four years to launch the next $ 400 product?

The reason is because in 2017, the iPhone X costing thousands of dollars still reached a sales record. Focusing on the super and premium segments in the following years is justified to optimize profits. It was not until the smartphone market was truly saturated, and it was not until Apple needed to set sales goals above profits (to boost the service segment), that the new iPhone SE should return.

Or, slowly “pouring” features is another slow but sure strategy for Apple. iPhone 11 shows that the iPhone can have a big battery and 3 cameras. But Tim Cook did not launch these features from the X or XS generation but waited until the iPhone 12, also when the notch design was 2 years old and became obsolete. In other words, Tim Cook waits until design draws to a minimum before launching two features that users really need.

Soon, the iPhone 12 will also have a LiDAR sensor on the back and a new design (two glass sides). That alone is more than enough to maintain sales. Attractive enhancements such as 120Hz screens, under-screen cameras will also be reserved for the distant future.

Is this the reason genius Warren Buffet bet nearly half of his wealth in Apple stock | Phone

There are many things Apple can do to do serious damage to Android rivals – the question is when?

Again, note that Apple is slow not because it’s impossible, but because it counts. For example, a monitor: for example, throughout iPhone history, Apple has always bought components from Samsung. Apple can afford to buy 5-inch screens from 2011 or 2012, and of course it can also buy 120Hz screens from this year (or last year). But Tim Cook will not – he will wait for the right moment to launch.

This makes Apple really scary for Android vendors. There are many things that Apple has NOT done, but once done, it will strongly affect Android. An iPhone SE will strongly affect high-end Android sales. Foxconn factories in India will seriously hurt Samsung and Xiaomi’s market share. The price drop of $ 50 / year will help Apple dominate the market in the high-end segment. These are all things Apple can do, and will do when it balances its profit ambition, cross development goals or other long-term calculations.

People call Warren Buffet “the prophet of Omaha” because he regularly predicts exactly which investments will yield long-term profits. Currently, Wall Street’s “prophet” is betting nearly half of its fortune on Apple’s future. If Warren Buffet thinks that Apple’s future will be brighter, how can its rivals be sure that their future will not be gloomy?

[ Æsir Tales ]
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