The Billionaire’s Secret Stash: Uncovering Warren Buffett’s Top Pick
Warren Buffett, the legendary investor, has been quietly amassing a staggering cash reserve for Berkshire Hathaway. While he’s been a net seller of stocks for seven consecutive quarters, it’s not because he’s lost his touch. Buffett is still buying, and his favorite stock might surprise you.
A Cash Kingpin
Berkshire Hathaway’s cash stockpile is a staggering testament to Buffett’s financial prowess. In the first half of 2024 alone, he greenlit $2.9 billion worth of stock buybacks. Last year, the conglomerate repurchased a whopping $9.2 billion of its shares. It’s clear Buffett is keen on investing in his own company, but what about other stocks?
The Apple Enigma
Apple, Berkshire’s largest holding, seems like a top contender for Buffett’s favorite stock. After all, he praised the tech giant as “an even better business” than Coca-Cola. However, Buffett sold a significant chunk of Berkshire’s stake in Apple in Q2 2024, casting doubt on its status as his top pick.
New Kids on the Block
Berkshire’s new positions in Heico and Ulta Beauty are intriguing, but the relatively small investment sizes and uncertainty over who made the purchase decisions make them unlikely candidates for Buffett’s favorite stock.
Sirius XM: A Strong Contender
Sirius XM Holdings, on the other hand, looks like a promising candidate. Buffett loaded up on the stock in Q2, increasing Berkshire’s stake by more than 8x. He also bought more shares this month. However, there’s an even stronger case to be made for another stock.
Occidental Petroleum: The Clear Winner
Occidental Petroleum is Berkshire’s sixth-largest position, with a staggering $13.2 billion invested. Buffett has consistently added to Berkshire’s stake in Oxy since 2022, and it’s clear why. He praised Occidental’s management, vast oil and gas holdings, and the option to increase ownership via stock warrants. With regulatory approval to acquire up to 50% of the company, Occidental is a long-term play that Buffett is committed to.
Should You Follow Buffett’s Lead?
While Occidental might not be the best fit for every investor, its growth prospects, carbon capture and storage technology, and attractive valuation make it an compelling option for value investors. With a forward dividend yield of 1.7%, income investors might look elsewhere, but growth investors could find Occidental’s potential hard to resist.
Don’t Miss the Boat
Ever felt like you missed the chance to invest in the most successful stocks? Our expert analysts occasionally issue “Double Down” stock recommendations for companies poised for explosive growth. Don’t wait – now is the time to buy before it’s too late.
Leave a Reply