25% in a year, is the price of Apple shares now too high?

Warren Buffett is a legendary investor and many of his movements make a lot of sense. What happens to your position in Apple (Nasdaq: AAPL), although? The price of Apple shares increased a quarter during the last year (and more than tripled for five years).

Buffett discharged billions of Apple shares in recent years, but has also been thousands of pounds.

If you recognize that Apple is overvalued, why have you not sold the lot? If you believe that the price is good enough to justify that Apple is still your greatest possession, why sell any?

I don't know, frankly: only Buffett does it. Maybe it's for fiscal reasons. Maybe Buffett just wants to keep his diversified portfolio after Apple's shares shot.

But although I cannot read the wise of Omaha's mind, the very high cost of the actions of the technology company has made me scratch my head.

Apple can be close to a perfect business

Somehow, Apple has many of the elements that one would look for in a brilliant investment.

That is why I sustained it in the past and with pleasure I would have the shares again if I could buy them at an attractive price. After all, a brilliant investment requires (paraphrasing Buffett) buying in a large company at an attractive price.

The company's operations area is extensive. Of course, sell phones and computers, tablets and watches. But also earns a lot of money selling services. It also has a booming financial services.

Thanks to a strong brand, an installed user base, patented technology and the annoyance involved with the change of rivals, Apple has a great price power.

Last year, a net income of $ 94 billion reported. Not only is it a huge sum, but it is equivalent to a net profit margin of 24%. That is what the price power can do!

Here's why I'm not buying now

That wonderful economy helps to explain why the price of Apple's shares has shot in the last five years (and beyond: its performance has been excellent for several decades).

But it also means that I need to ask, as someone who would be happy to possess Apple actions: is it the price that would need to pay for them today?

After all, as a investor, its objective is to buy shares for less (ideally much less) than I think they will finally be worth it.

But Apple, with its $ 3.2TRN market capitalization, now has a price ratio of the shares of 34.

For me, that is too high to justify, so I have no plans to buy Apple again at the current price.

Buffett talks about an investor has a “margin of safety“And I don't see that in the current price. After all, the company faces a growing competition of low cost rivals.

Nor am I convinced that the money he has been seeing in his transmission business probably produces something like the return of the capital that is achieved in other parts of his extensive empire.