Anyone who follows investment behaviors of Warren Buffett knows very well that he does not like investing in technology stock. Despite stock investing being the main model of investing that he uses, technology stock seems not be one of his favorites. The main reason he gives as to why he avoids them is that he insists on not investing in a business he does not understand well. Technology is a field he is not proficient and therefore tries a much as possible to keep off the stocks. However, this does not mean that he has totally kept off, no! There are a few companies which he has invested in.
With the internet boom, many investors realized that there was a huge potential in the internet and technology. In 2011, Warren Buffett decided to join the technology, market. He bought stocks in IBM. Somehow, he must have seen something of great value in this company before investing. Buffett argues that technology companies have low chances of offering long-term investment opportunities due to the evolving nature of the business. By 2014, Berkshire Hathaway Inc. had 8% interest in IBM the reason which made Warren Buffett to invest in this company is its ability to maintain a strong financial management.
Recently, Warren Buffett has shown great confidence in a second technology company. In 2017, the company which received the largest share of Berkshire Hathaway is Apple. The company invested $20 billion in Apple taking the net shareholding to $28 billion. Warren Buffett believes Apple busies fits into his model of “value investing.” Apple is now the second company in terms of shareholding. It comes second after Wells Fargo. However, in recent investments, Apple leads. Buffett believes in Apple’s ability to maintain in clients. Many clients of Apple devices will not leave for another model. Its ability to retain clients makes it a worthy investment.