This post includes affiliate links. If you purchase anything through these affiliated links, 247wallst.com may earn a commission.
Warren Buffett earned the "Oracle of Omaha" title through his 60-year success at Berkshire Hathaway. One of the world's best investors of all time, Buffett has certainly become one of the Mount Rushmore of investors, at least in the minds of those with a long-term investing time horizon. Given the returns Berkshire Hathaway ( NYSE:BRK-B ) has provided over the years, and its rather consistent ability to beat the market, investors continue to pay close attention to the individual stocks Mr. Buffett is betting on at any given point in time. Now's no different.
The thing is, Warren Buffett has been in selling mode in recent quarters, slashing stakes in some of his largest holdings, while maintaining or even adding to other positions. It does appear that the Oracle of Omaha is expecting some amplified turmoil on the horizon, and many in the market are now shifting their view to a much more bearish one in line with Buffett's recent actions.
With that said, given the long-term nature of the Berkshire portfolio, I'd imagine certain positions are held (and potentially enhanced) in a market downturn type of environment. Here are three such stocks I think investors may want to consider backing the truck up on, if things do in fact get pretty bad.
Key Points About This Article:
- Warren Buffett is widely known as one of the greatest investors of all time, as his publicly-traded portfolio has beaten the market over very long periods of time.
- While the Oracle of Omaha has been in selling mode lately, here are three of his long-standing picks I wouldn't be surprised to see Buffett add on dips moving forward.
- If you’re looking for some stocks with huge potential, make sure to grab a free copy of our brand-new “The Next NVIDIA” report . It features a software stock we’re confident has 10X potential.
Coca-Cola (KO)
A tin of Coca-Cola beading sweat
Coca-Cola ( NYSE:KO ) is among the most recognizable global brands within Berkshire's portfolio, and certainly a stock many long-term investors have been grateful to own. Aside from the stock's 2.7% dividend yield, this is a fundamentally-sound blue-chip giant that has continued to see relatively strong global growth in the face of some increasingly daunting macroeconomic headwinds.
The company's ability to weather previous crises (and its likely ability to weather whatever storm may be on the horizon) has a lot to do with the company's brand and pricing power in its core market. A global leader in the beverages market, Coca-Cola has expanded into other key categories such as snacks in a bid to garner growing market share in the consumer discretionary sector.
Coke's steady growth and adaptability have solidified the company's position as a reliable cash cow. Despite a forward price-earnings ratio of around 24-times, the company's premium valuation relative to its peers is warranted. That's because in times of turmoil, I think Coke's brand value will allow for a pricing differential its peers may not be able to hold.
Despite a 1% drop in revenue in Q2 , Coca-Cola did see solid increases in its Latin America and Asia Pacific markets. Assuming this globalization trend continues, Coca-Cola could be positioned for growth (or at least stabilization) in a market where other players may be forced to give up share. In the face of what could be some strong macro headwinds on the horizon, this is a stock I think is worth owning here.
Apple (AAPL)
An image of two iPhones side by side
Apple ( NASDAQ:AAPL ) has continued to bounce around as the world’s largest company (or among the largest). Currently holding a $3.4 trillion market cap , Apple remains Buffett's largest holding by portfolio weight, despite his large trim of roughly half his Apple stake in recent quarters.
Warren Buffett began buying AAPL stock in 2016 when the stock was trading closer to 10-times earnings. Today, the stock once again generates a premium multiple of around 34-times trailing earnings, which is considerably higher than the overall market. Maybe Buffett's strategy is to take some cream off the top of what's been an incredible run (and I don't imagine he'll liquidate his position entirely). But I would also expect that if this consumer discretionary giant gets to the sort of valuation levels it once saw around a decade ago, Buffett himself may start backing up his own truck of cash to buy more shares at cheaper levels.
Apple recently introduced its iPhone 16 lineup at the "Glowtime" event in Cupertino. The company's new smartphone models include the iPhone 16, iPhone 16 Plus, iPhone 16 Pro, and iPhone 16 Pro Max. Designed with Apple Intelligence AI, these phones feature enhanced chips and the programmable Action button, now available on the base models.
There's the possibility that Apple's growth rate could accelerate from here, and we will get the soft landing everyone is expecting. But if Apple dips alongside the broader market, this is a stock I think investors will want to buy on any serious downturn.
Moody's (MCO)
A web browser search for Moody's website on a smartphone
Moody's ( NYSE:MCO ) ranks seventh in terms of portfolio weighted holdings within Buffett's publicly-traded stock portfolio. Indeed, his ability to add to his Moody's exposure over the years is a testament of how Buffett thinks about the ratings agency and financial services firm, and suggests he thinks the company has plenty of growth ahead of it.
In Q2 2024 , Moody's reported $1.8 billion in revenue, reflecting growth of 21% year-over-year. The company has continued to expand through strategic partnerships and steady innovation, leading Buffett's investment in the company (which began in 2000) to absolutely balloon in value. Currently, MCO stock makes up around 3.8% of Berkshire's overall portfolio , making this a meaningful stock for investors to watch moving forward.
The fact that Buffett hasn't trimmed this stock in years is a testament to his belief that there's still room to run with this name. The company's business model which provides crucial data and insights to investors looking to navigate global risks and opportunities is one that has provided strong cash flow. The company's services segment saw 36% revenue growth year-over-year, driving its recent quarterly results, and could be the lynchpin of future growth moving forward.
With a recent guidance raise and the potential for low-teens revenue growth for the foreseeable future, this is a stock I think may be worth adding on major dips moving forward.
“The Next NVIDIA” Could Change Your Life
If you missed out on NVIDIA’s historic run, your chance to see life-changing profits from AI isn’t over.
The 24/7 Wall Street Analyst who first called NVIDIA’s AI-fueled rise in 2009 just published a brand-new research report named “The Next NVIDIA.”
Click here to download your FREE copy.
Local News
Comments / 0