Multi-billionaire Warren Buffett remains bullish on IBM (NYSE: IBM).
Buffett’s Berkshire Hathaway Inc. took a new 10-million share stake in General Motors Co. in the first quarter, a decision that drew most of the attention about the firm’s latest SEC filing.
However, tech investors also learned that Buffett increased his financial stake in IBM.
According to wire reports, Berkshire Hathaway added another 500,000 IBM shares, increasing its total to 64.4 million.
The company’s investment in IBM was first disclosed last fall, and it’s already paying off.
IBM shares closed at $199.04 on Tuesday, up from the $170 range at which Buffett made his first investment. They reached a 52-week high of $210.69 last month.
Initially, the IBM investment surprised many because Buffett had long refused to invest in technology companies because it’s too hard to predict which one will prosper in the long run. But Buffett said in November that IBM had become more of a service company with long-lasting customers who are reluctant to change.
“They have laid out a road map and followed it extremely well,” Buffett said at the time of the disclosure. “I probably read the annual report of IBM every year for 50 years.”
Berkshire bought 5.6 percent of IBM’s share at around $170 each for an investment reaching $10.7 billion.
“There’s a fair amount of presumption in many places that if you’re with IBM, you stay with them,” Buffett said.
“If you’re in some country around the world and you’re developing your IT department, you’re probably going to feel more comfortable with IBM than with many companies,” he added.
“They’ve done a terrific job of developing that.”
IBM employs an estimated 10,000 people across North Carolina.
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