Google may have last week managed to overtake Apple as the world’s most valuable company for the second time this year, but as was the case last time, it didn’t last long. As Philip Elmer-DeWitt noted in his blog, Apple has quickly regained its number one slot …
The back-and-forth reflects Apple’s changing stock market fortunes as the market attempts to make sense of the recent decline in iPhone sales. Even noted billionaire investors seem uncertain which way to bet, Carl Icahn bailing out as Warren Buffet jumped in.
Quartz reporter and former WSJ finance writer Matt Phillips suggested that Buffett’s move may, paradoxically, be because he thinks Apple’s days of rapid growth are over.
Berkshire Hathaway’s stake is actually just an acknowledgement of the direction Apple has been heading in for years under CEO Tim Cook. Since taking the helm in 2011, Cook has essentially been tasked with managing the transformation of Apple from a fast-growing company seemingly immune to the law of large numbers, to a more stately—but still incredibly profitable—corporate powerhouse that consistently showers shareholders with dividends and buybacks.
Now, Apple is joining the ranks of the high-quality, if somewhat sleepy, clutch of corporations Berkshire has owned for decades, including Coca-Cola and IBM. There are worse fates.
InvestorPlace agrees that Buffett enters stocks for the long run.
If you’re a shareholder, there’s definitely reason to cheer today’s news. While Mr. Icahn is the stereotypical corporate raider — swooping into a position, rabble-rousing and demanding changes, dividends and buybacks, and then selling out — Buffett cares only about long-term investing.
Has AAPL become a boring blue-chip investment, or is there more big-time growth to come? Share your thoughts in the comments.