Warren Buffett: Top 5 Picks to Buy Now

Warren Buffett: Top 5 Picks to Buy Now
Like most investors, one of your top goals should be to achieve financial freedom. That could mean funding a lavish retirement, or having a career based on your values, not necessarily the largest paycheck.

So, it stands to reason that your wealth should be invested in stocks that ideally generate above-market returns with below-market risk.

  • Special: See What One Ticker... One Trade... EVERY WEEK...Can Do for YOU
  • One of the best ways to do that is to follow the Warren Buffett model.

    In fact, if you want to invest in companies attractive to the billionaire, make sure they are:

    • Simple companies that are easy to understand
    • Companies with predictable, proven and growing earnings
    • Companies that can be bought at a reasonable price
    • Companies with an “economic moat,” or a unique advantage over its competition.

    “I look for companies that have a business we understand; favorable long-term economics; able and trustworthy management; and a sensible price tag. We like to buy the whole business or, if management is our partner, at least 80%,” says Warren Buffett.

    So, which stocks have been favored by the billionaire? Here are five.

  • Special: 1 New Trade. Each Week. 80% Win Rate Guarantee. Get the Details Here.
  • Opportunity No. 1 – Occidental Petroleum (OXY)

    Starting in 2022, Buffett’s Berkshire Hathaway aggressively bought shares of Occidental Petroleum. Further buys in 2023 have led to holdings of 222 million shares, or about 25 percent of the company.

    Oil giants, like OXY, are now flush with cash thanks to high energy prices and less of a focus on spending considerable capital to develop new oil projects. In fact, oil giants have so much cash, they’re returning it to shareholders through buybacks and dividends, which Buffett loves.

    In addition, according to Kiplinger, “cash in trash when inflation runs hot, and oil is an inflation hedge.” Best of all, Occidental is a leading producer in the U.S. Permian Basin, which holds about 105.7 billion barrels of oil. That avoids the political risk of investing in energy projects overseas.

    Opportunity No. 2 – Apple Inc. (AAPL)

    With a diversified revenue stream, and an ability to adapt to new consumer trends, Apple remains a strong component of the Berkshire portfolio. In fact, Warren Buffett once told CNBC that he continues to invest in Apple because of its brand, ecosystem, and strong economic moat. He also views Apple’s iPhone, as a “must have” device for a large part of the global population.

    In addition, Apple is a global leader in consumer technology innovation. Just look at the iPhone alone. First introduced to the public in 2007, it’s now one of the most popular mobile phones in the world, with growing market share. The iPad essentially created the tablet market, which offers a simple to use mobile touchscreen.

    For Buffett, who seeks out strong companies with moat and powerful brand recognition, no wonder he loves Apple so much. The company’s growing dividend and commitment to a big share buyback program should continue to drive returns higher in the years ahead.

    Opportunity No. 3 – Paramount Global (PARA)

    Millions of Americans are dropping their traditional cable and satellite services for streaming. That’s because streaming allows them to watch programs whenever they want. Plus, streaming catalogs are constantly growing, offering thousands of options for old and new shows and films.

    Despite the big growth already in recent years, the streaming market is expected to grow faster than the overall economy. In 2021, the streaming market was worth about $59.14 billion. Between now and 2030, it’s expected to grow at a CAGR of 21.3%, according to Grand View Research.

    Sure, the streaming market has seen its own share of struggles, but billionaires like Warren Buffett love it. For one, PARA became an undervalued opportunity. Two, Paramount management lifted its subscriber target for its Paramount+ and Showtime programs to 100 million by the end of 2024.

    While Buffett was a big buyer in 2022, he continued to add to his holdings, increasing his stake by 1 percent in the second quarter of 2023.

    Opportunity No. 4 – Citigroup (C)

    Warren Buffett is a value investor, uncovering stocks that trade at less than intrinsic value that should trade at a higher multiple. One of the stocks fitting that mold was Citigroup, which, after losing more than a third of its value became a value play. Buffett often buys shares of large banks, usually following a crisis that leads to a big drop in their share price, and Citigroup is just one of many big bank stocks Buffett loves.

    In addition, with a low valuation and a strong dividend yield of 4.3 percent, Buffett was simply getting greedy with Citigroup stock, as others became fearful. That was apparent in 2022’s market drop, when the bank suffered a big loss as trading volume declined. But shares are trending higher in 2023.

    Plus, as Buffett waits for the Citigroup stock to recoup its losses, his firm can still sit back and collect an impressive dividend yield, and benefit from the bank’s share buyback.

    Opportunity No. 5 – Coca-Cola (KO)

    What’s not to like about Coca-Cola?

    With strong demand, dependable dividends, and incredible earnings growth, Coca-Cola may be of the best stocks to own for the long-term.

    Buffett, who drinks about five cans of Diet Coke a day, agrees, once calling KO a “forever” stock. Coca-Cola is also a dividend king, raising its dividend for the last 60+ years.

    Even better, the total addressable market for non-alcoholic drinks is estimated to be worth $833.1 billion at the moment. From here, it could grow at a CAGR of 5.6% through 2030.

    Coca-Cola is likely to take a big part in that growth, especially as it has diversified out of soda products in recent years and into other beverages such as coffee and energy drinks. That will continue to fuel profits – rewarding shareholders in the process.

  • Special: See What One Ticker... One Trade... EVERY WEEK...Can Do for YOU