Warren Buffett is one of the greatest investors of all time. For any beginner Warren Buffett’s stock picks would help his footing into the share market. Berkshire Hathaway, the company he’s managed since 1965, has returned 19.8 percent annually through the end of 2022 during Buffett’s leadership, doubling the return of the S&P 500 over that time period.
Warren Buffett’s stock picks are some of the best stock investments of all time. Warren Buffett’s top 5 stock holdings are in some companies he’s held for at least a decade.
Warren Buffett’s portfolio: investing approach
One thing that makes Berkshire Hathaway’s investment approach unique is that Warren Buffett’s stock picks consists of both stocks he purchased and also entire companies. He has often written that he views the two purchases the same, no matter if he’s buying 5 percent of a company or the entire thing.
Some of Berkshire’s longest and most successful investments have been when they’ve purchased an entire company,
In recent years, Buffett has exited some long-time investments in the banking industry including Wells Fargo, M&T Bank and U.S. Bancorp. All three of those investments had been held for more than a decade. The sales of banks at the end of 2022 were well-timed, as the sector sold off following the collapse of Silicon Valley Bank in March 2023.
Warren Buffett’s top 5 stock holdings
Berkshire takes a concentrated approach with its investments, typically holding the majority of its portfolio in just a few companies. Its largest holdings at the end of the second quarter accounted for about 75 percent of the portfolio’s value. These included Warren Buffett’s top 5 stock holdings. This would help one in buying Warren Buffett’s stock picks for long term.
Coca-Cola (KO)
Warren Buffett’s portfolio has Coco-Cola which it began buying stock in the fall of 1988, eventually building a $1.3 billion position. Just three years later the investment was worth $3.75 billion, more than all of Berkshire at the time of its investment. Buffett saw that Coke had an extremely strong brand with lots of room to grow profitably for many years. In 2022, Berkshire received dividends of $704 million from its Coke holdings and its stake was worth nearly $25 billion.
- Length of holding: 35 years
- Cost: $1.3 billion
- Market value: $24.8 billion
American Express (AXP)
One more of the Warren Buffett’s top 5 stock holdings included American Express was built primarily in the mid-1990s. Buffett told shareholders in his 2022 letter that dividends from American Express to Berkshire have grown from $41 million in 1995 to $302 million in 2022.
- Length of holding: 30 years
- Cost: $1.3 billion
- Market value: $25.0 billion
Moody’s (MCO)
In early 2000, Berkshire disclosed an investment in Dun & Bradstreet, which spun off Moody’s later that year. Buffett told the Financial Crisis Inquiry Commission in 2010 that he liked Moody’s because it had enormous pricing power and “almost infinite” returns on tangible assets.
- Length of holding: 23 years
- Cost: $248 million
- Market value: $7.5 billion
Apple (AAPL)
Warren Buffett’s portfolio also include Apple. Berkshire disclosed its position in Apple in early 2016, but it was later that year and in early 2017 when Buffett really loaded up on the stock, making it one of Berkshire’s largest investments ever.
- Length of holding: 7 years
- Cost: ~$30-$35 billion
- Market value: $151.0 billion
Globe Life (GL)
Berkshire bought a position in life insurance company Torchmark around 2000 and the company changed its name to Globe Life in 2019. The stock has been a solid, but not spectacular performer during Berkshire’s holding period, increasing from about $10 per share to $106 as of June 2023.
- Length of holding: 23 years
- Cost: unknown
- Market value: $699 million
Berkshire Hathaway’s portfolio holdings:
Below are the new stocks added to Warren Buffett’s portfolio.
D.R. Horton Inc. (DHI)
Berkshire started a new position in homebuilder D.R. Horton in the second quarter, piling on nearly six million shares. The stake is now worth about $736 million, and it comes amid tight housing conditions as well as high (and rising) mortgage rates.
Occidental Petroleum Corp. (OXY)
Berkshire continued to increase its position in Occidental Petroleum where it’s the largest shareholder. Berkshire added more than 12 million shares in the quarter, putting its stake at around 224 million shares in the oil and gas giant. The stake is now worth more than $14.6 billion. Berkshire has increased its Occidental holdings in five of the last six quarters.
Berkshire also reportedly holds $9.5 billion of Occidental preferred stock and warrants to buy $5 billion of OXY shares at $59.62 each.
NVR Inc. (NVR)
NVR is yet another homebuilder that joined Berkshire’s portfolio in the second quarter. Berkshire bought 11,112 shares of NVR stock in the second quarter, a stake that’s worth about $70.6 million.
Lennar Corp. (LEN.B)
Along with D.R. Horton, Lennar joined Berkshire’s stable of homebuilder stocks. The conglomerate acquired 152,572 shares in the second quarter, now worth about $18.9 million.
The homebuilder stakes are relatively small by Buffett’s standards. Berkshire currently holds 152,572 shares of Lennar’s Class B preferred stock worth about $17.2 million.
Capital One Financial (COF)
Berkshire added to its position in Capital One Financial during the quarter as bank stocks suffered due to the regional bank crisis. Berkshire held nearly 12.5 million shares, now worth $1.36 billion, up from just over 9.9 million shares at the end of the first quarter. Capital One is a bank that specializes in credit cards, auto loans and banking accounts.
For all the beginners
While you may want to emulate Buffett’s success, remember that he is an advocate for index funds. But if you want to institute his investment strategy in your own portfolio, focus on investing in businesses rather than the latest hot stock. And plan on holding your portfolio for the long-term.
