Warren Buffett is undeniably the most closely watched, highest-profile investor in modern history. After all, no one boasts a superior track record of outperforming the S&P 500 Index. Not surprisingly, investors relentlessly clamor to match his success by analyzing his portfolio, hoping to absorb even a tiny morsel of Buffett’s investment genius.
Despite his unparalleled success, Buffett’s investment model has always been transparent, straightforward, and consistent. Fundamentally, he invests in fairly-priced, high-dividend paying blue-chip companies that feature strong balance sheets. Buffett buys such stocks with the intent to hang onto them over the long haul. The following five companies exemplify the types of investments housed within Buffett’s holding company, Berkshire Hathaway (BKR.A) as of Q1 2022.
Key Takeaways
- Warren Buffett’s investment strategy is to build a portfolio of blue-chip companies with strong balance sheets, holding investments over a long time.
- The top five investments in Buffett’s holding company, Berkshire Hathaway, are Apple, Bank of America, Coca-Cola, American Express, and Kraft Heinz.
- Apple is Berkshire Hathaway’s largest portfolio holding, comprising 47.6% of the portfolio.
- Buffett has held shares of Coca-Cola since the late 1980s; the company accounts for about 8.6% of Berkshire Hathaway’s portfolio.
- In 2011, Buffett began investing in Bank of America when Berkshire Hathaway purchased in a private offering 50,000 shares of the company’s preferred stock at a liquidation value of $100,000 per share.
1. Apple
Comprising 47.6% of the Berkshire Hathaway portfolio, Apple Inc. (AAPL) represents Buffett’s largest holding. Berkshire Hathaway owns approximately one billion shares in the tech giant, worth $157.5 billion at the time of its reporting.
Apple surpassed Wells Fargo to capture the #1 spot in 2018 after Berkshire Hathaway purchased additional shares of the Steve Jobs-founded company in February of that year.
2. Bank of America
With one billion shares to his name, Buffett’s second-largest holding is in Bank of America Corporation (BAC), valued at $45 billion and comprising 13.6% of his portfolio as of Q1 2022. Buffett’s interest in this company began in 2011 when he helped solidify the firm’s finances following the 2008 economic collapse.
Through a private offering worth $5 billion, Berkshire Hathaway agreed to buy 50,000 shares of Bank of America’s preferred stock with a liquidation value of $100,000 per share. Investing in Bank of America, which is the nation’s second-largest bank by assets, falls in line with Buffett’s attraction to financial stocks.
3. American Express
American Express (AXP) is the second financial services company to make Buffett’s top five list, occupying 7.5% of the portfolio. Berkshire Hathaway holds 151.6 million shares, valued at $24.8 billion as of Q1 2022.
Buffett acquired his initial stake in the credit card company in 1963 when it sorely needed capital to expand its operations. Buffett has since been a savior to the company, many times over, including during the 2008 financial crisis.
4. The Coca-Cola Company
Buffett once claimed to consume at least five cans of Coca-Cola per day, which may explain why the Coca-Cola Company (KO) stock is his third-largest holding. But one thing is for certain: Buffett appreciates the durability of the company’s core product, which has remained virtually unchanged over time, with the exception of the ill-fated “New Coke” formula rebranding in the mid-1980s. This makes sense, given that Buffett started buying Coca-Cola shares in the late 1980s following the stock market crash of 1987.
As of Q1 2022, with 400 million shares, valued at approximately $23.7 billion, Coca-Cola accounts for 7.2% of the Berkshire Hathaway portfolio.
5. Kraft Heinz
On Feb. 14, 2013, Berkshire Hathaway and 3G Capital announced a $28 billion deal to acquire global food brand H.J. Heinz Company. Two years later, the company merged with Kraft to become the Kraft Heinz Company (KHZ). In the years following the merger, the company has seen some rocky times, with share prices plummeting from a high of $96.65 in February 2017 to $19.99 in March 2020.
Despite this, Buffett still seems to maintain faith in the company, holding 325.6 million shares of Kraft Heinz at an approximate value of $11.7 billion as of Q1 2022. This is enough to rank Kraft Heinz as number five in our list of Buffett holdings, occupying 3.5% of the portfolio.
Buffett’s Successor
Warren Buffett began his career in the early 1960s. As Warren Buffett grew older, many investors and analysts grew concerned about who would take over the reins of the Berkshire portfolio once Buffett passed. Finally, at the company’s 2021 shareholders’ meeting, it was announced that Greg Abel, Berkshire’s vice chair of Non-Insurance Business Operations and the chair of subsidiary Berkshire Energy Holdings, would become the successor.
Which Are the to 10 Companies That Warren Buffett Owns?
Warren Buffett runs the holding Berkshire Hathaway, which, in turn, is a major shareholder of many public companies. In addition to the top five listed above, Berkshire’s top 10 holdings also include large interests in Moody’s (MCO), Verizon (VZ), U.S. Bancorp (USB), Chevron (CVX), and Bank of New York (BNY), among several others. In addition to these public companies, Berkshire also owns many privately-held firms such as GEICO Insurance, BNSF Railways, and Cypress Insurance.
Which Railroad Does Warren Buffett Own?
BNSF Railways (formerly Burlington Northern Santa Fe) is a wholly-owned subsidiary of Buffett’s Berkshire Hathaway.
Does Warren Buffett Own Cannabis Stocks?
No, not directly. However, it is possible that Buffett does have some indirect exposure to the legal marijuana industry through one or more of the companies that Berkshire Hathaway invests in. For instance, Coca-Cola has been said to have experimented with cannabis-infused soft drinks and has been rumored to have considered acquiring CBD companies (although the company denies these claims). Still, with such an extensive portfolio of companies, each of which may have its own subsidiaries, there is a strong chance that Buffett will have some sort of exposure, however indirect.
Which Insurance Companies Does Warren Buffett Own?
Berkshire owns several insurance companies including GEICO, Cypress Insurance, General Re, Berkshire Hathaway Re, National Fire & Marine Insurance Co., and National Indemnity Co.
Where Does the Name Berkshire Hathaway Come From?
Berkshire Hathaway was originally a textile manufacturer based in New England that resulted from the 1955 merger of Berkshire Fine Spinning Associates and the Hathaway Manufacturing Company. In the early 1960s, young value investor Warren Buffett began accumulating shares of the company, as he thought the sagging share price was a buy signal. However, he soon realized that the textiles business was not going to recover strongly in the U.S. and by 1967, then the majority shareholder in a failing business, began purchasing insurance companies instead under the Berkshire Hathaway banner. By 1985, the last of Berkshire Hathaway’s textile mills were shut down, and the company emerged as the powerhouse holding company it is today.
Source: finance.yahoo.com