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Buffett’s Bullseye: Meet The 4 Stocks That Make Up Nearly 75% Of His Portfolio

Buffett’s Bullseye: Meet The 4 Stocks That Make Up Nearly 75% Of His Portfolio


Legendary investor Warren Buffett has long preached the importance of passive investing in large-cap stocks.

“Be wary of investing activities that elicit applause; big moves are usually met with yawns,” said Buffett, who is also a big fan of dividend-producing stocks, which he calls the secret sauce to success of Berkshire Hathaway Inc.

Nearly 75% of Buffett’s portfolio is invested in just five stocks. Take a closer look.

Apple

Buffett is a long-time supporter of Apple Inc. (NASDAQ:AAPL), which he describes as “a better company than any we own.” About 50.04% of its portfolio is invested in Apple, valued at more than $155 billion as of September 30.

Despite market uncertainty, demand for Apple products remains strong, with iPhone sales hitting a record high during the fiscal fourth quarter ended September 30. Apple shares are up 49% year to date, making it one of the best. high-performance technology stocks this year.

“We now have our most comprehensive product lineup ever as we approach the holiday season, including the iPhone 15 lineup and our first Apple Watch models carbon neutral, a major milestone in our efforts to make all Apple products carbon neutral by 2030,” Apple CEO said. » said Tim Cook.

Wedbush is overweight Apple stock with a $250 price target, indicating nearly 30% upside potential. Morgan Stanley is also overweight the tech giant with a price target of $220, indicating upside potential of more than 13%.

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Coca-Cola

Buffett generated nearly $704 million in dividends from his investment in Coca Cola Co. (NYSE:EAST). His initial $1.3 billion investment in Coca-Cola stock has multiplied to $25 billion, according to Berkshire Hathaway’s 2022 annual shareholder letter.

Buffett owns 400 million shares of Coca-Cola through Berkshire Hathaway, representing 7.15% of his total portfolio.

Coca-Cola currently pays $1.84 in dividends per year, a yield of almost 3.2% on the current stock price. Dividend Aristocrat stock has a history of dividend distribution, having increased its annual dividend payments for 61 consecutive years.

Despite the volatile market environment, Coca-Cola is expected to maintain stable growth momentum, with the company’s revenue expected to increase 4.1% in the quarter ending December. The consensus earnings per share (EPS) estimate of $0.48 for the quarter ending in December indicates a 6.7% year-over-year increase.

Bank of America

Berkshire Hathaway owns approximately 1.03 billion shares of Bank of America Corp. (NYSE:BAC), representing more than 9% of Buffett’s investment portfolio. Bank of America shares are up more than 20% over the past three months.

Bank of America has benefited from decades-long high interest rates, with the bank’s total net income increasing 10% year over year to $7.8 billion in the fiscal third quarter ended September 30. Its EPS for the quarter stood at $0.90, indicating an 11% increase over the same period last year.

Bank of America also increased its dividend payments by 9% in July, bringing its total annual dividend to $0.96 and a yield of 2.89% from the current price.

Odeon Capital Group raised its outlook on Bank of America shares from Hold to Buy on Dec. 13 with a price target of $37.94, indicating upside potential of more than 13%.

American Express

American Express Company. (NYSE:AXP) is Buffett’s third largest holding, accounting for 7.22% of Berkshire Hathaway shares. As U.S. credit card debt surpassed $1 trillion in the second quarter, American Express reported an improvement in its finances. Spending by American Express’ millennial and Gen Z customers increased 18% year over year during the fiscal third quarter, which ended September 30.

American Express reported record third-quarter revenue for the sixth consecutive quarter, up 13% from the same period last year. American Express’ EPS increased 34% year over year to $3.30 for the third quarter.

The consensus revenue estimate of $16.01 billion for the quarter ending in December indicates a 13% year-over-year increase. Wall Street expects American Express’ EPS to be $2.65 for the quarter, a 13% year-over-year increase.

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This item Buffett’s target: discover the 4 stocks that make up nearly 75% of his portfolio originally appeared on Benzinga.com

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