Got an extra $1,000 you’d like to put to work but don’t quite know how? Don’t make it complicated. Just poach a pick or two (or several) from one of the world’s best-known and most-proven stock pickers. That’s Warren Buffett, of course. There’s a reason he’s been able to reliably lead Berkshire Hathaway (BRK.A -2.20%) (BRK.B -2.03%) to market-beating performances!
With that as the backdrop, here’s a closer look at three of Berkshire’s holdings that are solid prospects for you at this time. In no particular order….
Coca-Cola
It’s such a commonly-suggested Buffett pick that it’s almost become a cliché. Nevertheless, there’s good reason The Coca-Cola Company (KO -1.04%) continues to be highlighted as a stock you might want to own too. Not only is its namesake cola woven into the planet’s cultural fabric, but its other well-known brands like Gold Peak tea, Minute Maid juice, Dasani water, and Powerade sports drink (just to name a few) mean this beverage behemoth’s always got something to sell regardless of consumers’ ever-changing tastes.
That doesn’t mean things are always easy. Coke shares have fallen 16% from their early-September high in response to a small-but-alarming drop in the total amount of product sold (as measured by volume) during the company’s third fiscal quarter of last year. Operating income and net earnings fell even more during the three-month stretch, with no indication that the headwind was likely to abate during the quarter ending in December.
This is a timeless business though, and Coke’s brands are just as timeless. You’ll simply need to give this stock enough time for the company to prove it’s worth the wait.
Buffett’s certainly done so anyway. The 400 million-share stake in Coca-Cola that Berkshire’s currently holding was first opened all the way back in late-1998. The stock’s nearly doubled in value since then, while the dividend -- perhaps the chief reason Buffett’s such a fan -- has more than tripled during this timeframe, extending an annual growth streak of 62 years. To this end, newcomers will be stepping in while the forward-looking dividend yield stands at just under 3.2%.
Apple
At least just as much as The Coca-Cola Company is, Apple (AAPL -2.41%) is an frequently-suggested Buffett pick. As is also the case with Coca-Cola though, that’s for a good reason. See, Apple is another one of those dependable, timeless stalwarts with a well-deserved reputation for performance.
That’s not necessarily been easy to believe of late. Revenue has been stagnant since mid-2022, while sales of its flagship iPhone (as measured by revenue as well as unit sales) have been just as stagnant for just as long.
AAPL Revenue (TTM) data by YCharts
Buffett and his lieutenants have also been paring back the size of Berkshire’s stake in Apple of late, shedding roughly 600 million shares of the consumer-technology giant just since early last year. It certainly doesn’t seem like a vote of confidence.
Just keep things in perspective. Berkshire Hathaway’s position in Apple had grown to enormous proportions -- even by Buffett’s liberal standards -- at a time when it looked like unrealized stock gains might become subject to income taxation. He may have simply been thinking strategically. And either way, Berkshire’s $70 billion stake in Apple is still its single-biggest position, accounting for about one-fourth the value of all the conglomerate’s total stock holdings combined.
The irony? The company may be on the cusp of significant and prolonged growth.
See, near the end of last year Apple launched an AI-powered tool run directly from the company’s newer devices (as opposed to being run in the cloud, as most similar platforms like ChatGPT or Alphabet’s Gemini typically are at this time). The company’s also developing a processor chip that could power its own artificial intelligence data centers.
It’s not exactly clear where or what Apple’s place in the everchanging AI arena is. Given IDC’s expectation that the worldwide artificial intelligence platform market will grow at an annualized pace of more than 40% through 2028 though, Apple isn’t wrong to throw its hat in the ring and capture whatever growth it can.
BYD
Last but not least, add BYD (BYDD.F -2.41%) to your list of Warren Buffett stocks to buy with $1,000 right now.
Doesn’t ring a bell? It would be a bit surprising if it did… although you might be more familiar with it than you realize. The electric vehicle company that’s been outselling industry-leader Tesla from time to time since 2023? That’s BYD. Although BYD makes other things, most of its top line comes from its affordable electric vehicles and related products.It’s also one of a small handful of foreign stocks that the typically-pro-USA Buffett likes, and the only Chinese stock among Berkshire’s current holdings. This is telling in and of itself…
… telling, but not necessarily surprising in light of BYD’s past and projected growth. Even in the midst of global economic lethargy (particularly in and around China) this company’s top line is expected to grow by 24% for the entirety of 2024, followed by revenue growth of nearly 21% for the fiscal year now underway.
This pace of growth could persist for a long, long while too.
See, although US. consumers’ euphoria regarding EVs is cooling, actual global demand is still growing, and is likely to continue doing so. BloombergNEF predicts total worldwide sales of electric vehicles is going to nearly double its current levels by 2027 when it should reach 30 million units, en route to annual sales of 73 million electric cars in 2040. As BYD ventures further and further outside of its home turf during this stretch (perhaps eventually including the United States?) look for it to capture at least its fair share of this growth.
Oh, and don’t worry about BYD’s over-the-counter listing (as opposed to a more conventional exchange-listing). With a $100 billion market cap, it’s not your usual OTC stock. Securing U.S. exchange-based stock listings can be a logistical hassle as well as needlessly costly for many foreign companies. It’s certainly not a problem for Buffett and Berkshire, which presently holds nearly $2 billion worth of this over-the-counter ticker.
