Selling Apple shares was 'probably a mistake' and Munger knew it: Buffett

Warren Buffett conceded that selling some shares of Apple (AAPL) in Berkshire Hathaway's portfolio last year was likely a mistake, with the company remaining a tech leader providing massive utility to users around the world.

"The brand and the product, it's an incredible product. It's a huge, huge bargain to people. I mean the part it plays in their lives is huge. I mean, I use it as a phone but I'm probably the only guy in the country," the famed value investor said of Apple during Berkshire Hathaway's annual shareholder meeting on Saturday. "It is indispensable to people."

"I sold some stock last year, although our shareholders still saw their shares go up because we repurchased shares," he added. "But that was probably a mistake."

"Charlie in his usual low-key way he let me know that he thought it was a mistake too, didn't you Charlie?" Buffett asked his long-time business partner and friend, who sat by his side during the meeting. Charlie Munger replied: "Yes."

Berkshire owned 907,559,761 shares of Apple as of the end of December for a total market value of $120.4 billion. That gave Berkshire 5.4% ownership in the firm. By contrast, the firm spent just $31 billion accumulating this stake since late 2016.

That holding was the largest by market cap in the Berkshire portfolio, comprising 44% of its disclosed assets as of the end of last year, according to Bloomberg data. And that came even after the firm pocketed $11 billion after selling a small portion of its position in 2020.

"It's an extraordinary business. But I do want to emphasize that in his own way, it's a different way, but Tim Cook ... he's handled that business so well," Buffett added of Apple's CEO. "He couldn't do what Steve Jobs obviously could do in terms of creation. But Steve Jobs I don't think really could do what Tim Cook has done in many respects."

Since beginning to build Berkshire's stake in Apple in 2016, Buffett has used multiple occasions to tout the company. In his latest annual letter to shareholders, Buffett named Apple as one of the most valuable assets for Berkshire alongside the firm's insurance operation and BNSF Railway, thanks in part to its share repurchases that helped boost Berkshire's ownership stake without additional cost to the company.

At the start of the 2021 Berkshire Hathaway shareholder meeting, Buffett also presented a slide with the 20 most valuable companies in the world by market capitalization as an example of America's strength in generating high-value corporations. Apple topped the list with a valuation of more than $2 trillion.

Shares of Apple surged 81% in 2020, outperforming the other mega-cap tech stocks including Amazon (AMZN), Alphabet (GOOGL) and Facebook (FB). Shares have edged lower by about 0.9%, but recently set an all-time high earlier this year.

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Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck

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