Warren Buffett’s investment strategy is a case study in bold and safe play. Nearly $99 billion is pegged on two iconic names: Apple and Coca-Cola. Through Berkshire Hathaway, Buffett has channeled a whopping half of his equity holdings into Apple alone and he’s held tight to his Coca-Cola shares since the late 1980s.
Don’t Miss:
His strategy here is simple but powerful – backing companies with brand strength and consistent financials. Apple’s stock, for instance, surged 31% this year and many see this as Buffett’s savviest move yet. Some say it’s his “crown jewel,” lauding his foresight in spotting a tech company that’s proven as resilient as it is profitable.
But as with any big bet, Buffett’s heavy reliance on Apple has sparked some chatter. Skeptics say putting so many eggs in one tech basket could be risky. With tech stocks, there’s always the threat of shifting consumer trends, not to mention the occasional market shake-up.
Trending: The global games market is projected to generate $272B by the end of the year — for $0.55/share, this VC-backed startup with a 7M+ userbase gives investors easy access to this asset market.
And while Apple has shown impressive gains this year, the latest numbers hint at a slight cooling. In the last fiscal year, Apple’s total revenue dipped by 0.8% – a small shift but enough to raise eyebrows. Still, Morgan Stanley analyst Erik Woodring believes Apple has room to climb, setting a price target of $273, which would mark a 20% rise from current levels.
Apple’s pivot toward services is holding it steady. Though iPhone sales may ebb and flow, Apple’s revenues from the App Store, streaming and cloud services have grown by 23% over the past few years.
Services have also helped Apple boost its profit margins, going from 43.3% in 2022 to 46.2% in 2024, catching Wall Street’s attention. These margins and the cash flow from services make Apple’s high share prices easier to swallow, especially as it could mean bigger dividends for shareholders.
Trending: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — you can become an investor for $0.80 per share today.
Then there’s Coca-Cola, which stands out as Buffett’s textbook choice. It’s familiar, steady and beloved worldwide. His initial investment in Coca-Cola in the late ‘80s has since grown to a $27.67 billion stake and despite recent bumps – like a 12% drop from September’s peak – investors still see value here.
Morgan Stanley’s Dara Mohsenian predicts Coca-Cola could climb to $76 a share, marking a potential 19% increase. Investors love Coca-Cola for its dependable growth and steady dividend payouts. Coca-Cola just raised its dividend for the 62nd consecutive year, offering a 3% yield – a rarity in today’s market.
Unlike the roller-coaster nature of tech, Coca-Cola’s simpler, time-tested business model gives it a stability that’s hard to beat. The company’s revenue ticked up, with a 5.0% rise in the first nine months of 2024 alone and management projects 10% organic sales growth for the year – proof of the brand’s staying power.
Read Next:
UNLOCKED: 5 NEW TRADES EVERY WEEK. Click now to get top trade ideas daily, plus unlimited access to cutting-edge tools and strategies to gain an edge in the markets.
Get the latest stock analysis from Benzinga?
This article $99 Billion Bet: Warren Buffett Invests Heavily In 2 Stocks Expected To Jump 19% And 20%, Wall Street Analysts Predict originally appeared on Benzinga.com
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Source: finance.yahoo.com