Warren Buffett’s Berkshire Hathaway will collect nearly $800 million in Apple dividends this year – and that figure is likely to rise in the future

Warren buffett
Warren Buffett. AP Images
  • Warren Buffett’s Berkshire Hathaway will collect almost $US800 ($AU1,060) million in Apple dividends this year.
  • The investor’s company owns 5.5% of Apple, and has more than tripled its money on the stock.
  • Berkshire could see its unrealized gain, ownership, and dividend checks all increase.

Warren Buffett’s Berkshire Hathaway is set to pocket nearly $US800 ($AU1,060) million in Apple dividends this year, underscoring why the famed investor is such a big fan of the iPhone maker.

Apple confirmed this week that it will pay a total dividend of 0.865 cents ($11.46) a share in 2021, after raising its quarterly payout from 0.205 cents ($2.72) to 0.22 cents ($0.29) earlier this year. Berkshire owned 908 million shares of the technology group at the last count, so it’s set to receive $US785 ($AU1,040) million this calendar year.

Berkshire has raked in an average of $US775 ($AU1,027) million in annual dividends from Apple in recent years, Buffett noted in his conglomerate’s latest annual report. It would be looking at $US868 ($AU1,150) million this year if it hadn’t trimmed its Apple stake by 6% in the fourth quarter of 2020.

Those figures might seem big, but they’re dwarfed by the total value of Berkshire’s Apple position. The company spent $US35 ($AU46) billion between 2016 and 2018 to amass a stake worth $US133 ($AU176) billion today, meaning it’s more than tripled its money on paper in a few short years. Moreover, Apple has become the most valuable holding in Berkshire’s stock portfolio by far.

Assuming Buffett continues holding Apple, he’s likely to see his dividend checks fatten over time. Apple’s bosses plan to continue lifting the dividend each year, they said on an earnings call in April. They also spent north of $US80 ($AU106) billion on stock buybacks over the past four quarters, increasing Berkshire’s ownership of the business and its share of the dividends.

If Apple’s stock price keeps rising, and the company continues repurchasing shares and raising its dividend, Berkshire is poised to see its unrealized gain, ownership, and dividend checks all increase over time.

Given that outlook, it’s not surprising that Buffett has trumpeted Berkshire’s Apple stake as a “family jewel,” and described the company as “probably the best business” he knows.

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