I must say, Warren Buffett’s nickname, the Oracle of Omaha, certainly isn’t undeserved. Over a span of 55 years as CEO of Berkshire Hathaway (BRK.A) (BRK.B), this conglomerate’s shares have consistently outshone the broader stock market, making it a testament to his investment acumen and strategic leadership.
A significant portion of these outstanding returns can be attributed to the exceptional performance of Buffett’s chosen stocks. Therefore, it might serve you well to consider adopting some of his investment selections.
Given this context, let me share some insights about three investments that Warren Buffett, through Berkshire Hathaway, has chosen and which might also suit your investment portfolio.
Coca-Cola
Coca-Cola (KO) is not Berkshire Hathaway’s oldest or largest investment, but it comes very close in terms of both age and value. The 400 million shares they initially bought around 20 years ago have grown to a worth of almost $28 billion now. This represents nearly 10% of their total stock holdings, making it the fourth-largest position in Berkshire’s portfolio at present. The immense size and longevity of this stake are quite significant.
Buffett’s unwavering optimism isn’t hard to understand: He prefers quality investments, and Coca-Cola is one such investment. It stands as the largest player in the beverage industry due to its production of a highly regarded product and exceptional marketing of it over several decades.
I’m absolutely smitten by this brand! It’s not just about their iconic cola; they’ve got a whole lot more up their sleeve. From the refreshing Gold Peak teas to the zesty Minute Maid juices, invigorating Powerade sports drinks, and pure Dasani water, they’ve truly got something for everyone’s evolving palate.
Moreover, there are even more reasons to admire Coca-Cola. Buffett values their business strategy too. Unlike many might think, Coca-Cola doesn’t carry out much bottling these days. Instead, most of this less profitable task is delegated to third-party bottlers, allowing the company to concentrate on what it excels at.
That’s the previously mentioned marketing strategy. For instance, many people who lived back then can still recall the popular “I’d like to buy the world a Coke” commercial jingle, which debuted in 1971.
Buffett’s main attraction to Coke isn’t just about the company’s marketing abilities, but rather it seems to stem primarily from the stock’s consistent dividend payments. This dividend has been increased every year for an impressive 63 years in a row. For those new investors, this stock offers a forward-looking yield of approximately 2.9%.
Instead of using Coca-Cola’s dividend payouts to buy more Coca-Cola shares, Berkshire Hathaway prefers to accumulate these payments as part of its cash reserves. This allows them to utilize the funds in various other ways. This is a strategy that you might find worth considering for your own personal finance management.
Apple
Indeed, Apple Inc.’s (AAPL) shares have experienced some difficulties lately because the company hasn’t been as successful with artificial intelligence (AI). Moreover, Berkshire Hathaway has significantly reduced its stake in Apple since the end of 2023. However, it is important to keep a balanced perspective regarding both pieces of information.
Regarding the significant portion of its ownership in Apple, it’s important to note that Apple remains Berkshire’s largest investment. The value of their 300 million shares is approximately $63 billion, making up about a fifth (22%) of the entire stock portfolio held by the conglomerate.
This indicates that Buffett and his team continue to have great faith in Apple, possibly feeling uneasy about the substantial portion of Berkshire Hathaway’s portfolio that Apple had taken up following years of significant returns.
Regarding the initial attempt at AI development being less than satisfactory, remember to be patient. The company is actively preparing for a re-entry into this field, and their second attempt might prove to be far more captivating.
The main issue lies with Siri, Apple’s digital assistant on the device, which has not lived up to expectations recently. This lackluster performance also extends to Apple Intelligence, the technology introduced in October that was expected to include features like alerting users when something personally significant arises but didn’t. Additionally, several image tools were absent. In summary, consumers haven’t found compelling reasons to upgrade their iPhones to the AI-equipped newer versions from Apple due to these shortcomings.
The business now openly admits its errors, signaling a shift towards intensified efforts to deliver the “Wow!” factor that Apple has traditionally been associated with. For instance, Siri has a new leader overseeing its advancement. The company asserts that the transformation won’t be concluded until early next year, offering ample time to polish the artificial intelligence hardware on the first-generation AI-enabled iPhones – a development many consumers have been anticipating.
For now, phones that consumers are using right now will gradually become outdated, eventually requiring an update.
The point is, Apple — and its stock — just need some time.
According to Precedence Research, it seems that the worldwide market for AI digital assistants could experience a steady growth rate of approximately 24% per year until 2034.
Capital One Financial
To finish off, remember to include Capital One Financial (COF) as a current stock recommendation from Buffet’s portfolio for your investment considerations.
Some investors might be unaware that Berkshire Hathaway has any ownership in this particular company, and its shareholding is relatively minor. The conglomerate owns approximately 7.15 million shares, which equates to roughly $1.56 billion. However, it holds significantly larger stakes in companies such as Mastercard, Visa, and American Express.
However, it remains undeniably attractive as the standout credit card investment among those owned by Berkshire Hathaway, due to several persuasive factors.
One aspect is just its evaluation. The continual profits from Visa and American Express have boosted their already high stock prices for many years. Despite Capital One’s substantial growth since its 2023 low during the bear market, shares are still being traded at approximately 14 times this year’s anticipated earnings per share of $15.25.
A compelling reason to invest in Buffett’s stock sooner rather than later might be the acquisition of Discover Financial Services in May of this year. This purchase gives the company its own payment network, much like Visa, Mastercard, and American Express, eliminating one major hurdle that had previously required Capital One to rely on expensive third-party intermediaries for over a billion dollars annually.
By implementing this feature, our company can effectively utilize its expanded influence to guide more customers towards our branded credit cards, consequently leading them towards our online banking services as well.
To clarify, this year’s significant projected increase in revenue isn’t indicative of our future growth rate. Instead, it’s due to the merger of two comparable-sized companies within our organization. In the coming years, we anticipate that our revenue growth will revert to a more moderate single-digit percentage.
Despite its current profitability, this company is expected to maintain or possibly increase its profits, making it more dependable in paying out the modest dividend. It’s quite understandable that Buffett and his team initially invested in this venture back in 2023.
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2025-07-25 11:50