Investing

Buffett Is Trapped, Plain and Simple

Austin Smith

Published: April 27, 2024 7:15 am

In this discussion, Doug McIntyre, editor-in-chief of 24-7 Wall Street, speaks with Lee Jackson about Warren Buffett’s large investment in Apple (Nasdaq: AAPL) and whether Buffett is now “trapped” by this investment. They explore the implications of Buffett’s potential actions on Apple’s stock and the challenges of selling a significant stake without affecting the market.

Transcript:

Going back to Buffett for a second, I’ve really never seen an investor trapped. Look, I’ve seen insiders who own a lot of shares, but I’ve never seen an investor trapped this way. Did Buffett make a very, very big mistake by going so big on Apple? I think he did. And, you know, after the fact, everybody’s a genius. But again, still 41 percent of Berkshire Hathaway, which doesn’t have that many holdings anyway, although they have a ton of private companies, you know, the Dairy Queen and Acme Boot and all those other items. But, yeah, I think he went too large. And now he’s in a position where. Like we said earlier, selling it off would be difficult. I guess you could VWAP it over the day for the next three years, but they would know. Wall Street trading desks would know he is selling. It would take about three hours for the Wall Street Journal to figure out what was going on. Well, Apple’s earnings come out soon. And usually they talk a little bit about what their future is. I think Tim Cook is going to have to be much, much more vocal about what their future is because otherwise the stock is drifts down. He needs to take that Elon Musk playbook and understand that people are do like it when you say how great things are going to be as long as they turn out to be great. Reasonably soon. So two things will happen, and then we can come back to this. First, earnings. Second, Buffett will release his holdings as of June 30. So let’s come back and revisit this when those two things have happened. Yeah, and see if he’s sold more stock because he’s got a huge gain. So, I mean, he wouldn’t go out a loser for sure. No.