The Motley Fool·2025-07-21 07:06Core Insights - Warren Buffett has significantly reduced his stake in Apple, selling over 615 million shares, which represents a 67% decline, while still holding 300 million shares, making it his largest investment by market value [5][6][10] - Despite selling off a large portion of Apple, Buffett has been actively investing in consumer-facing businesses, particularly Domino's Pizza, which has shown consistent growth and innovation [4][14][18] Investment Activity - Buffett's selling activity has been more pronounced than buying since October 2022, with a total of $174.4 billion more sold than purchased [4][13] - The decision to sell a significant portion of Apple may be influenced by concerns over corporate income tax rates and the company's stagnant growth in physical device sales [6][8][10] Company Performance - Apple's net income has slightly declined from $94.7 billion in fiscal 2021 to $93.7 billion in 2024, with earnings per share (EPS) growth primarily driven by share repurchases rather than revenue growth [9][11] - Domino's Pizza has demonstrated strong performance, achieving 31 consecutive years of same-store sales growth internationally, and has a strategic growth plan focused on innovation and franchisee engagement [15][16][18] Valuation Concerns - Apple's forward price-to-earnings (P/E) ratio is currently at 27, which is considered high given the company's stagnant profit growth, leading to concerns about its valuation [10][11] - Domino's Pizza, while not cheap at 24 times forward-year earnings, is viewed favorably due to its strong brand loyalty and commitment to shareholder returns through dividends and stock repurchases [18]