Unlock the Secrets of Warren Buffett’s Portfolio
Want to give your portfolio a significant boost? Look no further than the stocks Warren Buffett is buying. With a track record of beating the market for decades, Buffett’s picks are worth paying attention to. Right now, two of his stocks stand out as being incredibly cheap and worth considering.
A Great Option for Oil Bulls: Occidental Petroleum
If you think oil prices are set to rise again, whether due to emerging market demand or geopolitical uncertainty, then Occidental Petroleum (NYSE: OXY) is a stock you need to take a closer look at. As an oil company primarily exposed to upstream operations, Occidental is particularly sensitive to changes in oil prices. With its $12 billion acquisition of shale producer CrownRock, the company could see its value soar if oil prices rebound higher.
Why Buffett Loves Occidental
Buffett has been invested in Occidental for several years, gradually increasing his stake to enormous levels. Last quarter, he bought more than 7 million shares, bringing the position value up to $16 billion. So, what does Buffett like most about Occidental? It’s likely the company’s leverage to rising oil prices. According to Occidental’s management team, cash flow would rise by around $260 million for every $1 uptick in oil prices.
A Growth Stock for Any Investor: Nu Holdings
You don’t have to be bullish on oil prices to love Nu Holdings (NYSE: NU). Buffett got in early on this little-known growth stock, but he has yet to sell a single share of his $1.4 billion position. Nu operates exclusively in Brazil, Mexico, and Colombia, delivering a suite of financial services digitally. With over 100 million customers and sales growing by more than 50% per year, Nu’s biggest days of growth may be behind it, but there’s still plenty of runway left.
Why Nu Stock Is Undervalued
At first glance, Nu stock may not seem particularly cheap, trading at 47 times earnings. However, with earnings set to grow by more than 70% this year and profits expected to continue growing by around 50% per year over the next five years, these high premiums could quickly look like a bargain. Assuming this growth continues, Nu stock could be valued at less than 10 times 2028 earnings, making it an undeniably cheap option for patient investors.
Before You Buy…
Before investing in either of these stocks, consider the Motley Fool Stock Advisor analyst team’s latest recommendations. They’ve identified what they believe are the 10 best stocks for investors to buy now, and neither Occidental Petroleum nor Nu Holdings made the cut. However, both stocks are worth considering for any investor looking to add some of Buffett’s favorites to their portfolio.
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