Warren Buffett is best known for being among the most successful investors of all time. Indeed, his success in investing has earned the billionaire a loyal following and the nickname “Oracle of Omaha.” His company, Berkshire Hathaway (NYSE:BRK-B), holds an expansive portfolio that spans various industries, from technology to finance and includes significant stakes in prominent blue-chip stocks. In fact, here are three of the best Warren Buffett holdings you may want to look into and invest in, aside from Apple (NASDAQ:AAPL).
Warren Buffett Stocks: Bank of America (BAC)
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Despite market fluctuations, Buffett has maintained his position in Bank of America (NYSE:BAC). In fact, Berkshire Hathaway’s investment in the bank is still worth around $28 billion. Bank of America’s credit quality is a promising factor, with a drop in the non-performing loans ratio and an increase in the net charge-off ratio in Q4. While it’s crucial to monitor these metrics in the upcoming quarters of 2023, the bank’s diversified loan mix has helped mitigate overall credit risk. Furthermore, the stock’s low forward price-earnings ratio of 8.03 and steady dividend yield of 3.1% (backed by a payout ratio of only 27.1%) make it a potentially valuable asset. Analysts anticipate the bank to weather 2023 well and experience growth in 2024 or later as the economy improves.
American Express (AXP)
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American Express (NYSE:AXP) is recognized for offering credit cards aimed at wealthier clients who tend to be less impacted by economic recessions. Consequently, the company may perform better in a challenging environment such as this year. American Express’s primary approach centers on gaining more customers and expanding its base. In 2022, the company secured 12.5 million new card accounts. Investors can anticipate a 15-17% rise in companywide EPS in 2023. The corporation intends to raise its payout rate by 15% as compensation for its excellent performance. Given its stable business and customer base, American Express holds an edge in this climate, indicating sustained growth.
Occidental Petroleum (OXY)
Warren Buffett has been relatively silent about Occidental Petroleum (NYSE:OXY) in recent times. However, Berkshire Hathaway’s (NYSE:BRK-A, NYSE:BRK-B) conduct has spoken volumes. Occidental Petroleum is a worthwhile addition to the list of oil and gas stocks to purchase and appears to be a preferred stock choice for Warren Buffett. It has an attractive valuation with a 1.18% dividend yield and a potential for robust dividend growth in the foreseeable future.
Occidental Petroleum focused on enhancing its credit indicators throughout the past year and paid off over $10.5 billion of debt, or 37% of the overall unpaid amount. The business is anticipated to continue to generate robust revenue and concentrate on debt reduction in order to quickly reach an investment-grade financial position. This could lead to increased shareholder rewards.
Occidental Petroleum ended 2022 with 3.8 billion barrels of oil equivalent in proved reserves, indicating a strong reserve base. The company is in a good position to produce profit for its stockholders in addition to having an appealing asset portfolio.
On the date of publication, Chris MacDonald has a position in BRK-B, AAPL. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.
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