Why Chamath Palihapitiya is not buying Apple's stock

Palihapitiya: Apple doesn't support long-term secular growth

Apple is not a tech company, it's "a luxury brand with pricing power," Social Capital's Chamath Palihapitiya said Wednesday on "Power Lunch."

"The dynamics of that business don't support long-term secular growth," said Palihapitiya. "They support a business model that is heavy on cash, heavy on value, but still susceptible to deep fundamental technical disruption."

He added, "Much like Warren Buffett has said very famously, he doesn't buy technology stocks because he doesn't understand them, I will not buy consumer goods companies because I do not understand them," he said.

Buffett's Berkshire Hathaway nearly quadrupled its stake in Apple in last year's fourth quarter, according to a regulatory filing made public Tuesday, although Buffett was not directly involved in that purchase. Berkshire reported owning 57.4 million Apple shares as of Dec. 31 — worth about $7.74 billion — up from just from 15.2 million shares three months earlier.

In the time Palihapitiya could have owned Apple's stock, he has owned Amazon which has quadrupled in value, he said.

"Good investors have to choose how to allocate their mind-share with the precious capital they have," he said.

— With reporting from CNBC's Josh Lipton and Reuters.