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Buffett's Buying Tech -- So Should You

By Eric Bleeker and Jeremy Phillips | More Articles
November 25, 2011 | Comments (4)

The following video is part of our "Motley Fool Conversations" series, in which Motley Fool senior technology analyst Eric Bleeker and chief technology officer Jeremy Phillips discuss emerging trends in technology.

In today's edition, Jeremy and Eric look at Warren Buffett's recent purchase of IBM and what other "Buffett-like" tech companies have gotten cheap across the sector. With companies from Apple to Intel trading for P/Es in the low teens to single digits, investors should be taking a look at some of the value in the sector.

Buffett's buying IBM for a simple reason: It's a well-managed company with a strong business trading at reasonable levels. One factor he might be overlooking is just how focused IBM is on a megatrend reshaping the IT industry. The Motley Fool details an emerging technology revolution in a new report called "The Only Stock You Need to Profit from the NEW Technology Revolution." The report highlights a company that has gained 228% since it was first recommended by Fool analysts and still has plenty of room left to run. Thousands have requested access to this special free report, and now you can access it today at no cost. To get instant access to the name of this company transforming the IT industry, click here -- it's free.  

The Steve Jobs Betrayal
You may already know that in the final year of his life, Jobs revealed a stunning betrayal — and told his biographer, "I will spend my last dying breath... and every penny of Apple's $40 billion in the bank to right this wrong." What was it that made Jobs so irate — and why could it make a few in-the-know investors some major profits over the coming months and years?

Enter your email address below to find out what made Jobs so enraged!

Eric Bleeker owns shares of Berkshire Hathaway, and Jeremy Phillips owns shares of no companies listed above. The Motley Fool owns shares of Berkshire Hathaway, Microsoft, IBM, Google, Apple, Activision Blizzard, and Intel, has bought calls on Intel, and has written calls on Activision Blizzard. Motley Fool newsletter services have recommended buying shares of Activision Blizzard, Microsoft, Intel, Berkshire Hathaway, Google, and Apple, creating a synthetic long position in Activision Blizzard, and creating bull call spread positions in Microsoft, Apple, and Intel. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 25, 2011, at 9:37 PM, jabaseball wrote:

    Fellows

    I understand the fascination with Buffet but don't you think you overdo it in your fawning? After all this genius has unilaterally ruled out tech for years while regular folks have done fabulously well in some great tech names (GOOG, APPL). And now he decides to buy IBM after it has doubled in the last three years. What is so smart about that?

  • Report this Comment On November 26, 2011, at 10:10 AM, alan0101 wrote:

    Buffet is not buying tech, as he explained to you, in a previous report, a) he does not consider IBM tech, nor should you, and b) one of his two new investment partners may or may not buy tech, if they are inclined to do so..

  • Report this Comment On November 26, 2011, at 11:42 AM, marc5477 wrote:

    I agree with Alan. Buffet likes IBM because it is a service provider, not because its a tech company. The problem with regular tech companies is their sustainability. Here today, gone tomorrow is common in the tech industry which is why Google is so desperately trying to expand out of the search engine arena. They know it wont last forever. Google did however win the cell phone sector and if their OS becomes dominant and makes its way to the desktop then look out (or if phones become our PC's in 10 years). Apple is a death trap. Stay away from it.

  • Report this Comment On December 16, 2011, at 12:45 PM, SwissViewpoint wrote:

    No - Buffett was not buying tech when he bought IBM - it was much more subtle than that - here's a real insight into Buffett's investment in IBM:

    http://whyorg.com/Warren-Buffett-Invests-IBM.aspx

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