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Warren Buffett is considered by many to be the best investor of all time. For more than five decades, Buffett has generated incredible benefits for shareholders of Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B), the company that helped build a $ 440 billion masterpiece of American capitalism and one of the world’s most admired companies.
Berkshire has a massive portfolio of publicly traded stocks, most of which were selected by Buffett himself. The Berkshire portfolio is closely watched by investors who wisely seek to accompany the investment movements of the Omaha Oracle.
If you want to invest alongside this legendary investor, here are three of the Berkshire Hathaway stocks that look particularly attractive today.
These actions approved by Warren Buffett can help you build lasting wealth. Image Source: The Motley Fool.
Wholesale costco
Buffett and his partner, Berkshire Vice President Charlie Munger have been fans of Wholesale costco (NASDAQ: COST). Berkshire bought shares in the warehouse chain in 2000. The shares it now held are worth more than $ 1.3 billion.
Costco has been a highly profitable investment for Berkshire, and is likely to continue to reward investors for years to come. The discount retailer has enjoyed strong sales during the COVID-19 pandemic. Many shoppers have turned to Costco to stock up on groceries, cleaning supplies, and other essential household items. They are likely to continue to do so for the remainder of the pandemic and thereafter.
Costco’s membership model gives it a powerful advantage over other retailers. Once people pay a membership fee, they have a financial incentive to maximize their investment by making as many purchases as they can at Costco. Costco makes it easier to do so by pricing your products just a little above cost and choosing to get the majority of your earnings from membership fees.
Low prices attract more people to become members, leading to higher profits – it’s a powerful formula that has fueled Costco’s growth for decades, and that should continue to drive its expansion for many years.
Amazon.com
Berkshire has also built a sizeable stake in the e-commerce colossus Amazon.com (NASDAQ: AMZN). Berkshire’s initial investment in Amazon was made by Todd Combs or Ted Weschler, Buffett’s chosen lieutenants, who oversee sizable portions of the megaconglomerate’s investment portfolio. Buffett has clearly signed the Amazon holding since then, and has repeatedly lamented his failure to invest in devastating market shares earlier. However, Berkshire’s stake in Amazon has grown to a value of more than $ 1.2 billion, and many more gains still lie ahead.
Amazon has three main engines of growth, all of which should help drive the company’s impressive expansion in the next decade. The first is its dominant e-commerce business, which enjoys particularly impressive growth during the coronavirus crisis as more purchases change online and move away from traditional retail channels. The second is Amazon Web Services, the rapidly growing cloud computing platform. And the third is Amazon’s burgeoning digital advertising business, which is being fueled by its growing army of outside merchants eager to present their products to more online shoppers.
Together, these powerful growth engines provide Amazon, and its investors, with many ways to make a profit for years to come.
Apple
Apple (NASDAQ: AAPL) It is Berkshire’s largest farm and one of Buffett’s favorites. In fact, Buffett once referred to Apple as “probably the best business I know of in the world.” Her affection for him has led Berkshire to amass a whopping $ 72 billion stake in the tech titan.
Buffett appreciates Apple’s strong consumer appeal and the loyalty its customers show to their devices, including, of course, the iPhone. He understands the value of Apple’s growing services business, which generates a constantly expanding and increasingly recurring high-margin revenue stream. Buffett also loves Apple’s balance of strength, incredible cash-generating skills, and a propensity to gobble up his own stock.
If you agree with Buffett and also value these aspects of Apple’s business, you may want to consider buying some of its shares today. Buffett will probably buy more shares of his favorite stake at some point, as he once said he would “love to have 100%” of Apple. That might be too big a bite to swallow, even for a giant like Berkshire. But buying now gives him a chance to claim his share of Apple, before Buffett gets even more shares.
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