5 Stocks Warren Buffett Still Loves


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Warren Buffett is the world's great investor. Buffett is a proud owner of stocks that have changed the world. Here are five stocks that he still loves today.

Published in: Economy & Finance, Business

5 Stocks Warren Buffett Still Loves

  1. 1. 5 Stocks Warren Buffett Still Loves
  2. 2. 5. Procter & Gamble Berkshire Hathaway owns 1.9% of Procter & Gamble Buffett first purchased Gillette shares (now part of Procter & Gamble) in 1989. What Buffett likes: • 25 of its products sell more than $1 billion in product annually. • Procter & Gamble owns 70% of the razor blade market, and 25% of fabric and laundry product sales globally. • It’s increased its dividend for 57 years in a row. • Its products grow naturally, helped by inflation in prices and population growth over time, making it a perfect buy-and-hold Buffett stock.
  3. 3. 4. American Express Berkshire Hathaway owns 14.1% of American Express Buffett’s history with American Express goes all the way back to 1964. What Buffett likes: • He bought his first shares cheap, following the socalled “Salad Oil Scandal,” which sent its share price down 50%. • The company benefits from the “network effect” as each new cardholder and point of sale adds to its moat. • American Express focuses on high-income, high-net worth spenders, earning more per customer than other card companies.
  4. 4. 3. International Business Machines Berkshire Hathaway owns 6.2% of IBM A new holding, Buffett first bought IBM in 2011. Shares are up 7% compared to the 52% of the S&P 500. Even still, Buffett continues to add to his position. What Buffett likes: • He’s familiar with the business, reading its annual reports “probably…every year for 50 years.” • IBM consistently lays out 5-year plans, and benchmarks its performance routinely. • It repurchases shares year after year, reducing share count by 36.6% in the past 10 years.
  5. 5. 2. Coca-Cola Berkshire Hathaway owns 9% of Coca-Cola Warren Buffett first bought Coca-Cola in 1988. What Buffett likes: • Buffett saw the obvious. Cola has no taste memory, so the 5th Coke you drink tastes just as good as the first. Over time, cola consumption only went up. • Coca-Cola has a wide moat stemming from its worldwide distribution. You can find its products in every country around the world except for Cuba and North Korea. • Coca-Cola’s brand is one of the most recognizable in the world.
  6. 6. 1. Wells Fargo Berkshire Hathaway owns 8.7% of Wells Fargo Warren Buffett first bought Wells Fargo shares in 1990. What Buffett likes: • Wells Fargo is a perfect Buffett stock -understandable with a wide moat. • The company leads in mortgage origination, and has a simpler balance sheet than other banking giants. • Wells Fargo’s cost of funds is lower than most banks in the United States as it generates the bulk of its financing from low-cost deposits. • The company leads in “share of wallet” -- getting its existing customers to use more Wells Fargo products and services.
  7. 7. Does Buffett love The Motley Fool’s top stock pick for 2014?