Will Warren Buffett Ever Buy Apple?

In this video, Fool tech/telecom analyst Andrew Tonner talks about whether Warren Buffett would ever buy Apple (NASDAQ: AAPL  ) .

While Buffett can arguably be called the greatest investor of all time, he hasn't made his money by investing in technology companies. In fact, the only tech company that Buffett's Berkshire Hathaway (NYSE: BRK-A  ) (NYSE: BRK-B  ) owns is IBM (NYSE: IBM  ) . His IBM purchase fit Buffett's strategy of buying great companies he understands and holding on to them, Andrew says.

But now there's another great tech company selling at a low valuation: Apple. Does this company fit Buffett's style? Since its pullback, Apple is trading at around 10 times earnings, and 6.5 times enterprise value to EBITDA -- a classic value stock, Andrew says. And over the past year, Apple has made the return of money to shareholders a priority, both through a dividend and stock buybacks -- something Buffett also looks for.

And although it's a tech company, Apple's business model is relatively simple. The company makes great products that make consumers' lives easier.

Although it may not fit into Buffett's understanding, it should for more tech-savvy investors. So while Buffett isn't a buyer, Apple has many of the characteristics he looks for in a company, Andrew says.

Whether Buffett's a buyer or not, there's no doubt that Apple is at the center of technology's largest revolution ever and that longtime shareholders have been handsomely rewarded, with more than 1,000% gains. However, after the company's major backslide recently, there is a debate raging as to whether Apple remains a buy. The Motley Fool's senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on both reasons to buy and reasons to sell Apple and what opportunities are left for the company (and your portfolio) going forward. To get instant access to his latest thinking on Apple, simply click here now.


Read/Post Comments (9) | Recommend This Article (3)

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 March 24, 2013, at 7:44 PM, dwilh51183 wrote:

    BUFFETT IS GOING TO BUY 750 MILLION WORTH OF AAPL, SOUCES CLOSE TO THE COMPANY SAID

  • Report this Comment On March 24, 2013, at 9:19 PM, aabigbill wrote:

    OK Gore bailed and Buffett isn't buying doesn't that tell you something.

  • Report this Comment On March 24, 2013, at 10:43 PM, ferdiefor wrote:

    Dear writer, stop talking your book.

    Everyone in the world seems to have a vested interest in doing anything possible to make Apple rise from the dead.

    The game has changed. Apple is now in a war with competitors that have the right products to counter Apple's seeming dominance. Those of us who sold near the highs understood the game had changed and Apple's short period of domination was over. Now, it will be more difficult than ever for Apple to replicate growth rates even close to those of the last year. The law of large numbers sunk Apple just like it has sunk every major hyper growth tech company.

    So lick your wounds and sell out to go into greener pastures.

    After I sold my Apple over $600 I moved into investments I have since sold such that Apple would have to reach $743 to justify holding versus selling and moving on to better investment opportunities.

  • Report this Comment On March 24, 2013, at 10:46 PM, joanofarc13 wrote:

    I believe Warren Buffett is too wavy to sashay a buyout. Simpler terms belies him auctioneeting so.Warren Buffett was most interested in Cecil Williams charity church. Yes, I follow Gore bailed outright stater system.

  • Report this Comment On March 25, 2013, at 12:02 AM, buffettphan wrote:

    I appreciated the information on this video; however, there was one huge error made by here. The man stated that Warren Buffett owned 15 billion SHARES of the tech giant (IBM). Of course, he meant to say "shares worth $15 billion, not 15 billion shares.

  • Report this Comment On March 25, 2013, at 3:32 AM, bobrb52 wrote:

    Who cares what Buffett does?

  • Report this Comment On March 25, 2013, at 9:30 AM, ellabulldog wrote:

    to invest in a company that is only a product or two away from going out of business would be silly, Apple will not maintain their growth, people bought a lot of horse carriages before the car was invented. Sony Walkman were popular and the Ipod is just a better version. Ipad is being copied. Android is popular for phones. Expecting too much for a company to maintain their popularity.

  • Report this Comment On March 25, 2013, at 7:17 PM, dfavela wrote:

    This article bothers me like excessive name-dropping does.

  • Report this Comment On April 02, 2013, at 7:56 PM, nkohli3 wrote:

    Buffet has often stated that he's very against investing in technology companies. A lot of what Buffet's philosophy of being a 'know something' investor is about understanding market fundamentals first and foremost. He places a lot of emphasis on Beta, market cap and especially P/E and how each relate to the industry respectively. I was a little confused about how P/E is specific to an industry but a video i watched cleared things up. It's by a CEO of an investing platform company http://www.youtube.com/watch?v=nqYEtzlYLlk

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