3 Warren Buffett Stocks You Should Buy Right Now

Warren Buffett doesn’t always beat the market. But he didn’t turn out to be one of the richest people in the world, and didn’t earn the nickname “Oracle of Omaha” by being a loser too often.

Investors don’t have to rack their brains with dismay at how Buffett makes his money. His action selections (and those of his lieutenants) are presented to everyone at least once a quarter with Berkshire Hathaway‘s (NYSE: BRK.A) (NYSE: BRK.B) regulatory files.

Which of these choices are likely to be the biggest winners in the long run? Here are three obvious Buffett stocks to buy right now.

Image source: The Motley Fool.

Berkshire Hathaway

I think the easiest call to make is to buy shares of Berkshire Hathaway itself. Investing in Berkshire puts you in perfect harmony with Buffett. After all, most of the billionaire’s net worth comes from his stake in the huge conglomerate.

It is perhaps telling that the one stock in which Berkshire Hathaway invests the most is … Berkshire Hathaway. The company repurchased $ 24.7 billion of its shares in 2020. Berkshire has maintained the buybacks so far this year.

Aside from ranking Berkshire as Buffett’s favorite stock, I think there are at least two other key reasons why it’s a smart choice right now. First, many businesses in Berkshire are in an excellent position to benefit from the recovery in the global economy following the COVID-19 pandemic. Second, the company has a huge store of cash that it could use to acquire one or more businesses to fuel additional long-term growth.

Admittedly, Buffett is quite picky about the deals he makes. There can be no assurance that Berkshire will use its cash on an acquisition in the near future. If not, however, it is likely that we will see more share buybacks. Either way, investors should win.

Apple

Of all the shares held by Buffett other than Berkshire, Apple (NASDAQ: AAPL) is his favorite. The tech giant is by far the largest position in Berkshire’s stock portfolio. Buffett even called Apple the “third largest company” in Berkshire, behind its wholly owned insurance and railroad companies.

Apple continues to be a big winner for Buffett, hitting an all-time high last week. I think the action will increase even more, both in the short term and in the long term.

The short term for Apple looks great due to the demand for 5G compatible iPhones. The more iPhones the company sells, the more revenue it generates from related products and services such as AirPods and the App Store.

In the long term, Apple should be able to maintain its momentum through innovation. The company is already developing impressive augmented reality capabilities. There are plans to launch a foldable iPhone in the next few years. There are also rumors of an Apple electric car in development.

Amazon.com

You could argue that Amazon.com (NASDAQ: AMZN) is not technically a Buffett stock. The legendary investor admitted in 2019 that another Berkshire investment manager had actually called to buy Amazon. However, Buffett has also admitted in the past that he “blew up” by not buying Amazon earlier.

I see Amazon as an obvious buy stock for long-term investors. Why? One of the main reasons is the Amazon divide. Buffett is a big fan of moats. In fact, he said that “the most important thing [is] try to find a business with a wide and sustainable ditch around it. ”

Amazon reigns supreme as the world’s largest e-commerce company. Of course, competitors could establish themselves in niche markets or maintain themselves in specific geographic regions. But Amazon’s scale gives it a big advantage. And while other big tech companies are gaining ground in cloud hosting, Amazon Web Services is still the market leader by far.

Equally important is Amazon’s optionality, its multiple avenues for growth. The company has expanded to the grocery market, the pharmacy market, and is now entering telehealth. I expect Amazon will find even more markets to enter in the coming years, rewarding shareholders along the way.