5 Cheapest Stocks in Warren Buffett’s Portfolio for 2024

1. Bank of America Corporation (NYSE:BAC)

Berkshire Hathaway’s Latest Investment: $28.28 Billion
Number of Hedge Fund Holders: 88
P/E Ratio: 9.49

Bank of America Corporation (NYSE:BAC) is another financial service investment play in Berkshire Hathaway’s portfolio. The company offers banking and financial products and services. Bank of America Corporation (NYSE:BAC)’s products include traditional and money market savings accounts, certificates of deposit and IRAs, and noninterest-and interest-bearing checking accounts.

Bank of America Corporation (NYSE:BAC) is flat for the year, but its revenues and earnings should receive a boost from the high-interest rate environment. While trading at a price-to-earnings multiple of 9.49, Bank of America Corporation (NYSE:BAC) yields 2.83%, ideal for generating passive income on the side. It is one of the oldest and biggest holdings in Buffett’s portfolio, with stakes worth $28.28 billion.

The cumulative value of Bank of America Corporation (NYSE:BAC) stakes held by 88 hedge funds in Insider Monkey’s database amounted to over $31.3 billion at the conclusion of the third quarter in 2023. This reflected a slight reduction compared to the previous quarter, during which 90 hedge funds held shares of Bank of America Corporation (NYSE:BAC).

Here is what Smead Capital Management, an investment management company, said about Bank of America Corporation (NYSE:BAC) in its Q3 2023 investor letter:

“Through the first nine months of the year, we had a gain of 2.10%. The S&P 500 had a gain of 13.07% and the Russell 1000 Value had a gain of 1.79%. The stock market realized markedly higher riskless US Treasury interest rates had their effect on the stock market as it began to reassert what Warren Buffett calls the “gravitational pull” on price-to-earnings ratios (P/E).

On the downside, Target (TGT), Bank of America Corporation (NYSE:BAC) and Pfizer (PFE) detracted the most in the first nine months of the year. Inverted yield curves are historically lousy for the banks, so the weak performance for BAC is no surprise.”

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