Apple Investors Urged to Remain Calm

To some, Berkshire Hathaway Inc.’s gutting of its Apple Inc. stake could be interpreted as a lack of conviction in the iPhone maker’s growth story. But many on Wall Street are urging investors to look past the news and stay calm.

Bloomberg reports the Warren Buffett-led conglomerate revealed Saturday that it sold almost half of its position in the tech giant during the second quarter. Its stake now stands at roughly $84 billion, down from about $140 billion at the end of March. The selling took place during a torrid run in the stock market that sent Apple shares 23% higher and pushed the S&P 500 from one record to the next.

Since 2016, when Warren Buffett first disclosed its stake in Apple, its shares have soared almost 900% as the company cemented its grip on the industry, delivering Berkshire billions of dollars worth of unrealized profits along the way.

“Buffett’s reduction of his Apple stake is merely about risk management,” said Joe Gilbert, senior portfolio manager at Integrity Asset Management. “If there were any concerns about the longer-term viability of Apple, Buffett would have exited the entire position. Similar to Berkshire’s other stock position reductions, Buffett has meaningful unrealized gains.”