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Suprise! Warren Buffett Actually Owns Some of the Street's Hottest Stocks

  • (0:30) - Is Value Being Left Behind?
  • (5:45) - Warren Buffett's Top Stock Holdings
  • (16:10) - Episode Roundup: RH, AAPL, V, MA, COST, AMZN
  • podcast@zacks.com\

 

Welcome to Episode #198 of the Value Investor Podcast

Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio, shares some of her top value investing tips and stock picks.

As the NASDAQ, and tech stocks, make yet another new all-time high, it gets more difficult to remain a value investor.

Ever since the coronavirus sell-off, value investors, and Warren Buffett, in particular, have been subjected to a higher amount of trash talk from growth investors.

It culminated in day trader, and founder of Barstool Sports, Dave Portnoy, calling Buffett “past his prime” and mocking his sale of the airline stocks for a loss as the coronavirus pandemic hit the global economy. He thought Buffett sold the airline stocks too early.

But Buffett is usually just the punching bag for the entire value sector.

Is Buffett Out of Touch?

Buffett, and Berkshire Hathaway, have been mocked for having too much cash in its portfolio, for not buying more tech, for being too heavily invested in the big banks and financials, which are out of favor and underperforming.

In 1999, Buffett was called out for being out of touch with the dot-com mania and now, 21 years later, he is again being hit with the same criticism.

Yet if you dig into Berkshire Hathaway’s portfolio, you’ll find that it actually owns several of 2020’s hot stocks.

Apple, Apple, Apple

No one gives Buffett credit for Apple AAPL.

Apple is now Berkshire’s largest single holding, at 36% of the portfolio. Berkshire first bought it in the first quarter of 2016. Warren Buffett has talked about his love of the management and cash flow many times over the last 4 years.

Apple shares are up 102% over the last 2 years and are hitting new highs.

His critics also look past some of his excellent long-term investments like Costco COST, which is also hitting new highs as an essential business during the COVID pandemic.

Berkshire first bought it in 2001. Shares are up 49% over the past 2 years.

Additionally, Berkshire has been all-in on the credit card companies for many years.

Mastercard MA has been a great investment. Shares were first bought in the first quarter of 2011. Over the last two years they’re up 50.4% compared to just 16% for the S&P 500.

Berkshire Owns Two FAANG Stocks

And Berkshire doesn’t own just one FAANG stock, it owns two.

Did you know that Berkshire owns Amazon AMZN shares? It only entered into this position in the first quarter of 2019. Shares of Amazon are hitting new highs in 2020.

But one of its best recent investments was in luxury furniture retailer RH RH.

It jumped into those shares in the third quarter of 2019. Shares are up 33% year-to-date and are hitting new highs.

What else should you know about Berkshire Hathaway’s portfolio and investing strategy?

Listen to this week’s podcast to find out.

[In full disclosure, the author of this article owns shares of RH and AMZN in her personal portfolio.]

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Click to get this free report

Amazon.com, Inc. (AMZN): Free Stock Analysis Report

Apple Inc. (AAPL): Free Stock Analysis Report

Costco Wholesale Corporation (COST): Free Stock Analysis Report

Mastercard Incorporated (MA): Free Stock Analysis Report

RH (RH): Free Stock Analysis Report

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