Definition of Gambit
something done or said in order to gain a benefit or advantage
Berkshire Hathaway, the conglomerate run by Buffett, disclosed in a regulatory filing Monday that it purchased more than 9.8 million shares in Apple
during the first quarter.
It marks Berkshire's first investment in
Apple. Berkshire acquired its position at an average price of about $109
a share.
Apple's stock price has since fallen to just above $90,
meaning that Berkshire's stake in Apple is now worth about $888 million.
The Apple purchase is the second big tech investment by Berkshire,
which has been steadily adding to its stake in IBM during the past few
years.
Until recently, Buffett had been famous for his lack of
investments in the tech sector.
But Apple fits perfectly in Buffett's
wheelhouse.
The company is a leader in its market and the stock is
extremely cheap, trading for just 11 times this year's earnings
estimates.
Apple also has a pristine balance sheet, with $232.9 billion
in cash.
At the end of April, billionaire investor Carl Icahn sold his entire stake in Apple,
citing the risk of China's influence on the stock.
Last week, Didi,
China's ride-sharing service and rival to Uber, announced Apple invested $1 billion in the company.
There's been a lot of money shuffling taking place as of late as Apple tries to reinvigorate the market after it had its first earnings decline in more than a decade.
With Steve gone we haven't expected any more shock waves in product releases from Apple.
But apparently there just might be something in the works and Buffett has his ear to the ground perhaps?
This is a very interesting development when an investor is willing to grab up 9.8 million shares at a decent price.
CEO Tim Cook is either blowing smoke or there is something up.
"The future of Apple is very bright," he said. "Our product pipeline has amazing innovation in store."
So has Steve left behind some as of yet undisclosed product ideas in a top secret file?
I doubt it.
Apple would not have tolerated revenue drops if such a file existed don't you think?
Can the next generation iPhone seven be a game changer.
Will the jaded public respond in this slowing iPhone sales climate?
We will be keeping an eye on this interesting situation now that Buffett has shown some very strong interest in Apple stock.
Get your can of genuine Buffett Rust remover while you still can.
There may be a big reversal coming down the pike for Apple stock!
Time will tell, especially now that a well known big player has a one billion stake in the matter...
Microsoft has shown that it thinks the cell phone craze has mellowed and is no longer a viable route to profit.
It's no secret that Microsoft's phone business isn't going according to plan.
Last quarter alone saw a 46% drop in phone revenue, slightly better than the 49% drop the quarter before that.
And now it seems that Microsoft is finally realizing this:
according to rumors, the tech giant is considering licensing 50% of its mobile business to Foxconn -- in other words, the Nokia brand it had purchased for 10 years, until 2024.
It appears that negotiations have reached very advanced stages, with Microsoft and Foxconn currently deliberating the final clauses of the deal.
Some of the implications of such a deal could mean about 50 percent of the Microsoft Mobile members would be looking for new jobs.
The rest of the team is said to join the Microsoft Surface team, and may be tasked with working on an upcoming Surface Phone which has been rumored for some time now.
Just some smoke blowing or is there an upcoming Surface Phone?
Will Buffett participate in the stock beforehand?
Microsoft has shown that it thinks the cell phone craze has mellowed and is no longer a viable route to profit.
It's no secret that Microsoft's phone business isn't going according to plan.
Last quarter alone saw a 46% drop in phone revenue, slightly better than the 49% drop the quarter before that.
And now it seems that Microsoft is finally realizing this:
according to rumors, the tech giant is considering licensing 50% of its mobile business to Foxconn -- in other words, the Nokia brand it had purchased for 10 years, until 2024.
It appears that negotiations have reached very advanced stages, with Microsoft and Foxconn currently deliberating the final clauses of the deal.
Some of the implications of such a deal could mean about 50 percent of the Microsoft Mobile members would be looking for new jobs.
The rest of the team is said to join the Microsoft Surface team, and may be tasked with working on an upcoming Surface Phone which has been rumored for some time now.
Just some smoke blowing or is there an upcoming Surface Phone?
Will Buffett participate in the stock beforehand?
Without Steve around it gets kind of boring in the tech field these days.
***
update:
The news that Berkshire Hathaway bought 1 billion of Apple shares added 18 billion to Apple's market value.
Why?
Because a lot of investors follow those with good track records.
They like to mimic what the hedge funds are up to.
Usually the safe bet is to get on board early and jump out early when the stock rises.
Stocks do indeed go up after big name managers disclose positions.
But the effects wear off quickly or are small.
Events like this can help the day trader to slightly beat the market.
It is a pump-and-dump situation for the average investor.
Timing is everything, you have to get off the elevator ride up before everyone starts heading for the door.
Any kind of an event can see a mass exit.
The market is always fickle.
Stick with blue chip stocks and you usually stay in for the long haul.
Penny stocks is a whole another story, steer clear if you don't want extreme risk exposure for the most part.
***
update:
The news that Berkshire Hathaway bought 1 billion of Apple shares added 18 billion to Apple's market value.
Why?
Because a lot of investors follow those with good track records.
They like to mimic what the hedge funds are up to.
Usually the safe bet is to get on board early and jump out early when the stock rises.
Stocks do indeed go up after big name managers disclose positions.
But the effects wear off quickly or are small.
Events like this can help the day trader to slightly beat the market.
It is a pump-and-dump situation for the average investor.
Timing is everything, you have to get off the elevator ride up before everyone starts heading for the door.
Any kind of an event can see a mass exit.
The market is always fickle.
Stick with blue chip stocks and you usually stay in for the long haul.
Penny stocks is a whole another story, steer clear if you don't want extreme risk exposure for the most part.
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