This article presents an overview of the Warren Buffett 2024 Portfolio: Top 5 Stock Picks. For a detailed overview of such stocks, read our article, Warren Buffett 2024 Portfolio: Top 12 Stock Picks.
5. Chevron Corp (NYSE:CVX)
Warren Buffett’s Stake: $18,808,080,506
Berkshire Hathaway has been enjoying dividend payments from oil giant Chevron Corp (NYSE:CVX) for years as the firm first bought a position in Chevron Corp (NYSE:CVX) in the last quarter of 2020. In the fourth quarter of 2023 Berkshire increased its holding in Chevron Corp (NYSE:CVX) by nearly 15%.
Chevron recently announced a 7.9% increase in its dividend. Earlier this month Chevron Corp (NYSE:CVX) posted Q4 results. Adjusted EPS in the quarter came in at $3.45, beating estimates by $0.23. Revenue fell 16.5% year over year to $47.18 billion, missing estimates by $6.02 billion.
The London Company Large Cap Strategy stated the following regarding Chevron Corporation (NYSE:CVX) in its fourth quarter 2023 investor letter:
“Chevron Corporation (NYSE:CVX) – CVX underperformed during 4Q as oil prices fell, 3Q results missed expectations, and CVX negatively adjusted 2024-2025 cash flow guidance for its key asset in Kazakhstan. It is also notable that CVX announced a deal to acquire Hess Corp in a stock-for-stock transaction. While we generally do not maintain a high degree of exposure to pure commodity businesses, we continue to view CVX favorably for its conservative balance sheet, focus on returns, and commitment to the dividend.”
4. Coca-Cola Co (NYSE:KO)
Warren Buffett’s Stake: $23,572,000,000
Berkshire Hathaway opened its position in Coca-Cola Co (NYSE:KO) back in 2001 and as of date Warren Buffett is a huge fan of Coca-Cola Co (NYSE:KO). Over the years Berkshire has enjoyed billions in consistent dividend payments from the beverage company. As of the end of the fourth quarter of 2023 Berkshire owns a $23 billion stake in Coca-Cola Co (NYSE:KO).
As of the end of the fourth quarter of 2023, 62 hedge funds had stakes in Coca-Cola Co (NYSE:KO).
Hayden Capital made the following comment about The Coca-Cola Company (NYSE:KO) in its third 2023 investor letter:
“It’s not just emerging markets either, where one could argue a “scarcity premium” given fewer quality public companies. Even in the US, The Coca-Cola Company (NYSE:KO) trades at ~30x P/E despite having the same earnings as 10 years ago.
Both of these companies actually have lower revenues than 10 – 15 years ago too, indicating that their profit growth is mostly from margin expansion. This can only last for so long before there’s no more excess expenses left to cut.
I find it ironic that all these companies trade as “bond-equivalents” in the minds of investors – even commanding lower yields than US treasuries, the safest security in the world. But it’s clear that their businesses are not nearly as safe. Coca-Cola is facing disruption risk from consumers shifting to new, heathier beverage brands.
But these companies are ~35% more expensive than US Treasuries, despite the heightened risk. On a risk-adjusted basis, one could argue the implied premium is even higher.”
Perhaps the explanation is simply the price volatility difference between these stocks and treasuries over the last two years. For example, 10-year Treasury bonds are down ~-20% since the beginning of 2022. By comparison, KO and PG are remarkably down only -4 – 6% over that time frame.”
3. American Express Company (NYSE:AXP)
Warren Buffett’s Stake: $28,402,748,537
As of the end of the fourth quarter of 2023, Berkshire Hathaway owns a $28 billion stake in American Express Company (NYSE:AXP).
In its fourth quarter 2023 investor letter, Oakmark Select Fund stated the following regarding American Express Company (NYSE:AXP):
“American Express Company (NYSE:AXP) is one of the largest credit card issuers and payment networks in the world. We believe the company’s closed-loop network, brand equity and scale represent durable competitive advantages. Unlike most card issuers that process credit card transactions over third-party networks, American Express processes transactions over its own network. This allows American Express to earn greater economics than peers on each card transaction. The company retains part of this advantage in the form of higher profitability and reinvests the rest in enhanced customer rewards and service. Over time, these investments have helped American Express build its brand and attract more lucrative, high-spending card customers. We expect this business model and customer-centric approach will continue to drive industry-leading growth for years to come. Concerns over the near-term economic outlook allowed us to purchase shares of American Express at a 13x P/E on next year’s consensus earnings estimate. We think that is an attractive valuation for a company with this combination of business quality and growth.”
2. Bank of America Corp (NYSE:BAC)
Warren Buffett’s Stake: $34,776,127,042
Bank of America Corp (NYSE:BAC) ranks second in our list of top Warren Buffett portfolio stocks in 2024. Berkshire owns a $34 billion stake in Bank of America Corp (NYSE:BAC) as of the end of the fourth quarter.
Smead Value Fund made the following comment 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.”
1. Apple Inc. (NASDAQ:AAPL)
Warren Buffett’s Stake: $174,347,466,800
Berkshire Hathaway trimmed its stake in Apple Inc. (NASDAQ:AAPL) by just over 1% in the last quarter of 2023 and everybody went haywire believing Warren Buffett might begin to offload Apple Inc. (NASDAQ:AAPL) shares from his portfolio. But many believe this was just a rebalancing and the Oracle of Omaha would not decrease his exposure to Apple Inc. (NASDAQ:AAPL). As of the end of the fourth quarter Berkshire owns a $174 billion stake in Apple Inc. (NASDAQ:AAPL).
Mairs & Power Growth Fund stated the following regarding Apple Inc. (NASDAQ:AAPL) in its fourth quarter 2023 investor letter:
“The Fund’s relative performance was negatively impacted by what we didn’t own as well. In particular, not holding Apple Inc. (NASDAQ:AAPL) for most of the year cost the Fund more than 300bps (basis points) of performance. Apple may be the best-known company in the world and its seemingly ubiquitous iPhone holds a dominant share of the global cell phone market. Apple is even more dominant among Millennials and Gen Zers, which should lead to even greater market share as these cohorts age. This loyal user base should pay huge dividends for shareholders as Apple continues to monetize this ecosystem, especially as the company delves deeper into services, payments, and AI. We initiated a position in Apple during the fourth quarter and await a more attractive entry point to add to our position.”
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