Warren Buffett in annual letter calls Apple one of ‘Four Giants’ driving the conglomerate’s value

Apple is one of the four pillars that make up the conglomerate of mostly old-economy businesses that Warren Buffet has assembled over the last five decades.

In his annual letter to shareholders released on Saturday, the investing legend listed Apple under the heading "Our Four Giants" and even called the company the second-most important after Berkshire's cluster of insurers.

Tim Cook, Apple's brilliant CEO, regards users of Apple products as his first love, but all of his other constituencies benefit from Tim's managerial touch as well.

TheOracle of Omaha made clear that he is a fan of Cook's stock repurchase strategy and how it gives the conglomerate increased ownership of each dollar of the iPhone maker's earnings without the investor having to lift it.

Apple is a different sort of holding because of its yearend market value. The increase in our ownership seems like small potatoes. Each 0.1% of Apple's earnings amounted to $100 million. We didn't spend any money to get our accretion. Apple's purchases did the job.

Todd and Ted Weschler were invested by Buffett and began buying Apple stock. The conglomerate had a stake in the company that cost $36 billion. The Apple investment is now worth more than $150 billion, accounting for 40% of the equity portfolio.

Last year, Apple paid us $785 million in dividends, which is why they are not counted in the GAAP earnings. Our share of Apple's earnings was over $5 billion. Much of what the company retained was used to buy Apple shares.

Outside of index and exchange-traded fund providers, Apple's largest shareholder is Warren Buffet. Over the years, the conglomerate has received regular dividends from the tech giant.

The railroad business BNSF and the energy segment BHE were both giants of the conglomerate, which both registered record earnings in 2011.

The third Giant, BNSF, is an indispensable asset for America as well as for the company.

The railroad, utilities and energy business continued to recover from the Pandemic hit as operating earnings surged 45% in the fourth quarter.

The investor continued to prefer internal opportunities in an increasingly expensive market as he bought back a record $27 billion of his shares. At the end of last year, the cash pile stood at a near record $150 billion.