Warren Buffett’s Top Picks for 2025
Despite being a net seller of stocks for eight consecutive quarters, Warren Buffett is still actively investing in select companies. In 2024, he added 10 new stocks to Berkshire Hathaway’s portfolio. But which one has the most potential for growth in 2025?
Old Favorites and New Additions
Buffett continued to build on existing positions in companies like Chubb, Occidental Petroleum, and Verisign. He also initiated new positions in Heico, Ulta Beauty, Domino’s Pizza, and Pool Corporation. However, Liberty Media SiriusXM Holdings is no longer in the running after merging with Sirius XM in September.
Growth Prospects and Valuation Concerns
Heico’s rapid sales and earnings growth come at a premium price, with shares trading at nearly 53 times forward earnings. Meanwhile, Domino’s Pizza and Chubb were the top performers among Buffett’s 2024 purchases. However, Chubb’s exposure to recent wildfires could impact its stock performance in 2025.
A Long-Term Bet on Occidental
Buffett has expressed his intention to hold Occidental Petroleum indefinitely, and its oil and gas reserves make it an attractive long-term investment. However, the incoming administration’s policies may lead to increased domestic production, potentially affecting oil and gas prices in 2025.
A Hidden Gem in the Making
Sirius XM, with its forward-earnings multiple of just 6.4, presents an attractive valuation opportunity. Its 5.15% forward dividend yield is also higher than its peers. While there’s no consensus on its prospects, the average 12-month price target suggests an upside potential of almost 22%. Could Sirius XM be the best of the bunch for 2025?
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