In this article, we will look at the five Warren Buffett stocks that are too cheap to ignore. If you want to read about some more Warren Buffett stocks, head on over to 10 Warren Buffett Stocks That Are Too Cheap To Ignore.
5. VeriSign, Inc. (NASDAQ:VRSN)
Price to Earnings Ratio as of October 17, 2022: 23
Number of Hedge Fund Holders: 35
Industry Average P/E: 29
VeriSign, Inc. (NASDAQ:VRSN) is an internet company that provides several services such as domain name registry and internet infrastructure. It also provides back end systems for a variety of different domain names. The firm is headquartered in Reston, Virginia, the United States.
VeriSign, Inc. (NASDAQ:VRSN) posted $352 million as its second quarter revenue, which marked a record growth for the firm. Additionally, its second quarter operating income margin of 67% was a record high for the company. VeriSign, Inc. (NASDAQ:VRSN) has a price to earnings ratio of 23, which is below the industry average of 29, making the stock a cheap buy.
Warren Buffett’s Berkshire Hathaway held 12.8 million VeriSign, Inc. (NASDAQ:VRSN) shares that were worth $2 billion as this year’s second quarter ended. During the same time period, 35 out of the 895 hedge funds polled by Insider Monkey had invested in the company.
VeriSign, Inc. (NASDAQ:VRSN)’s largest investor after Mr. Buffett is Jim Simons’ Renaissance Technologies which owns 3.9 million shares that are worth $622 million.
4. The Kroger Co. (NYSE:KR)
Price to Earnings Ratio as of October 17, 2022: 13.15
Number of Hedge Fund Holders: 49
Industry Average P/E: 14.82
The Kroger Co. (NYSE:KR) is a retailer that was set up in 1883 and is headquartered in Cincinnati, Ohio. The firm operates warehouses and department stores that offer a wide variety of products such as groceries and medicines.
Mr. Buffett’s holding company owned 52 million The Kroger Co. (NYSE:KR) shares that were worth $2.4 billion as part of its June quarter of 2022 investments. Insider Monkey’s 895 hedge fund survey for their second quarter of 2022 investments outlined that 49 had invested in the company.
The Kroger Co. (NYSE:KR) is aiming to take on larger firms such as Walmart by acquiring Albertsons. It aims to add $1 billion in synergies from the deal by 2024. The company’s P/E ratio of 13.15 is lower than the grocery retailer average of 14.82, implying that there is room left for the shares to grow.
The Kroger Co. (NYSE:KR)’s second largest investor is Jim Simons’ Renaissance Technologies which owns 16 million shares that are worth $792 million.
3. HP Inc. (NYSE:HPQ)
Price to Earnings Ratio as of October 17, 2022: 4.4
Number of Hedge Fund Holders: 35
Industry Average P/E: 21.57
HP Inc. (NYSE:HPQ) is an iconic American consumer technology brand that is known for selling a host of products such as laptops and printers. The firm is headquartered in Palo Alto, California.
HP Inc. (NYSE:HPQ) has had the second largest market share in the personal computing market since 2018, with the market share sitting at 13% by the end of this year’s second quarter. The company’s personal systems segment is growing at an average rate of 7.8% over the past five years as well. Extrapolating the personal computing and periphery revenues of the firm with market growth projections results in HP Inc. (NYSE:HPQ) growing its revenue by an average of 5% over the next three years.
As this year’s second quarter ended, Berkshire Hathaway held 104 million HP Inc. (NYSE:HPQ) shares for a $3 billion stake. The company has one of the lowest P/E ratios in the industry, with the latest reading of 4.4 sitting well below the average of 21.57. HP Inc. (NYSE:HPQ) also pays a 25 cent dividend for a 3.9% yield. Insider Monkey’s Q2 2022 survey of 895 hedge funds outlined that 35 had invested in the firm.
HP Inc. (NYSE:HPQ)’s largest investor after Warren Buffett’s Berkshire Hathaway is Cliff Asness’ AQR Capital Management which owns 2.9 million shares that are worth $97 million.
2. U.S. Bancorp (NYSE:USB)
Price to Earnings Ratio as of October 17, 2022: 10
Number of Hedge Fund Holders: 43
Industry Average P/E: 14.79
U.S. Bancorp (NYSE:USB) is a commercial and corporate banking company that is headquartered in Minneapolis, Minnesota, the United States. The firm provides a host of services such as checking and savings accounts and mortgage banking and insurance.
Berkshire Hathaway’s Q2 2022 portfolio revealed that the firm had owned a $5.5 billion stake in U.S. Bancorp (NYSE:USB) which came through 119 million shares. During the same time period, 43 out of the 895 hedge funds polled by Insider Monkey had also bought the company’s shares.
U.S. Bancorp (NYSE:USB) is one of the largest regional banks in America, as it has branches in 20 states and a whopping $600 billion in assets. The ongoing Federal Reserve interest rate hike saw the firm’s interest income jump by 9.5% during its second fiscal quarter. U.S. Bancorp (NYSE:USB) pays a 48 cent dividend for a 4.4% yield and its P/E ratio of 10 is lower than the regional banking industry’s average of 14.79.
After Mr. Buffett, U.S. Bancorp (NYSE:USB)’s largest investor in our database of 895 hedge funds is Jean-Marie Eveillard’s First Eagle Investment Management which owns 9.5 million shares that are worth $439 million.
1. Occidental Petroleum Corporation (NYSE:OXY)
Price to Earnings Ratio as of October 17, 2022: 6.56
Number of Hedge Fund Holders: 66
Industry Average P/E: 9.71
Occidental Petroleum Corporation (NYSE:OXY) is an oil and gas exploration company that is headquartered in Houston, Texas. The company explores for and extracts crude oil and natural gas, and then transports the products through its facilities.
Occidental Petroleum Corporation (NYSE:OXY)’s shares have appreciated by a whopping 123% on the market year to date, making it a rare firm that has widely beaten all major stock market indexes. Despite this appreciation, the shares are still as cheap as they can get, with a P/E ratio of 6.56, well below the industry average of 9.71.
Berkshire Hathaway’s second quarter of 2022 portfolio saw the firm own 158 million Occidental Petroleum Corporation (NYSE:OXY) shares that were worth a whopping $9.3 billion. Insider Monkey scanned 895 hedge fund holdings for the same time period to discover that 66 had held a stake in the company.
Occidental Petroleum Corporation (NYSE:OXY)’s second largest investor is Rajiv Jain’s GQG Partners which owns 25 million shares that are worth $1.5 billion.
Disclosure: None. You can also take a look at Top 10 Tech Stocks to Buy According to Billionaire Louis Bacon and 11 Best Cyclical Stocks To Buy.
