Warren Buffett’s company Berkshire Hathaway filed its quarterly report of its holdings as of the end of 2021. I found it interesting. Based on the stocks listed in the company’s filings, I think that I can see three Warren Buffett stocks that I would be willing to buy right now and hold for the next 10 years.
The first Warren Buffett stock that I would buy now is Amazon (NASDAQ:AMZN). The online retail giant has been a part of Buffett’s investment portfolio since early 2019. The stock has performed poorly over the past year or so but I think that the strength in the underlying business makes this an excellent time for me to add to my existing investment in Amazon.
Amazon shares currently trade at a price-to-earnings (P/E) ratio of around 47. Investing at this level might be risky in an environment where rising interest rates challenge stocks that trade on high multiples of earnings. But I think that Amazon’s strong business performance — underscored by the 40% growth in revenue in its Amazon Web Services segment and the 32% growth in its advertising business — justifies the current price.
Another Warren Buffett stock that I would buy now is Verizon (NYSE:VZ). Berkshire announced its stake in Verizon stock at the start of 2021, after having received permission not to disclose its investment at the end of 2020. The shares currently trade lower than they did when Buffett was buying them. I think that the current price represents an attractive opportunity for me to buy shares that will do well over the next decade.
In many ways, Verizon is the opposite of Amazon. I don’t think that the underlying business is likely to see explosive growth over the next decade, but I believe that the stock’s lower P/E multiple reflects this. The risk here is that its debt level gives it limited financial flexibility. The company’s debt, however, is the result of significant recent investments, so I take the view that it has decent prospects ahead of it without having to look for further opportunities.
Lastly, StoneCo (NASDAQ:STNE) is a Warren Buffett stock that has been catching my eye recently. The Brazilian fintech is down a huge 88% from its highest point and now trades below its IPO price at which Berkshire Hathaway invested in it. I think that now might be a decent time for me to pick up some shares while the company’s shares are out of favour.
I think that the enduring risk comes from the fact that the business does most of its business in Brazil. This means that an investment carries currency risk since StoneCo makes its money in Brazilian reals. It also means that high inflation there might pressure the volumes of payments the company processes. In light of these risks, I wouldn’t have bought the stock at its highs. After an 88% decline, though, I feel better adding to my investment.
Warren Buffett likes to look for strong companies that are available at attractive prices. I think that Amazon, Verizon, and StoneCo fit the bill. As such, I’m buying shares in all three of these for my portfolio.