Markets

Insider Trading

Hedge Funds

Retirement

Opinion

Warren Buffett Sees Big Gains in These Small-Cap Stocks

In this article, we will discuss Warren Buffett Sees Big Gains in These Small-Cap Stocks. If you want to explore similar stocks, you can also take a look at Warren Buffett Sees Big Gains in These 5 Small-Cap Stocks.

With a net worth of about $120 billion, Warren Buffett is one of the most revered investors, as a good chunk of his wealth comes from investments in equity markets. He is best known as a value investor, constantly scanning for high-growth stocks with tremendous upside potential but trading at highly discounted levels. 

There is always a lot of interest in what Buffett says and does, given the success he has enjoyed with his investments through Berkshire Hathaway. The legendary investor did not become a master of the game overnight. He inherited the investing wisdom from his father, who was a US congressman and later on a stockbroker.

His family’s strong connections allowed him to raise significant funds to launch his career as an investor on Wall Street. Nevertheless, his ability to identify and stick to investing principles has affirmed his status as one of the greatest on Wall Street. Between 1965 and 2022, he averaged compound annual gains of 19.8%, outperforming the S&P 500 with average gains of 9.9%.

One of the things that makes Buffett stand out from other money managers is that he focuses on investing in businesses rather than stocks. While the focus is always on share prices and the rate at which they are likely to increase, Buffett focuses on the core business. The focus is always on how the business is going and how it is expected to perform in future.

Many believe Buffett only focuses on major, stable companies like Amazon.com, Inc. (NASDAQ:AMZN), Meta Platforms, Inc. (NASDAQ:META) and Microsoft Corporation (NASDAQ:MSFT). However, Buffett also pays attention to the small-cap companies given their tremendous room for growth as long as they are backed with solid underlying fundamentals. Buffett said at a shareholder meeting that if he were to start again with a small budget in the investing world, he’d pay more attention to small-cap companies.

“I probably would be focusing on smaller companies because I would be working with smaller sums and there’s more chance that something is overlooked in that arena,” Buffett said.

DaVita Inc. (NYSE:DVA), Paramount Global (NASDAQ:PARA) and Ally Financial Inc. (NYSE:ALLY) are some of the small-cap stocks with a market cap of less than $10 billion that Buffett remains heavily invested in.

Buffett’s investment philosophy of holding stocks for the long haul has been a key factor in his successful career. He has always insisted that one does not need to trade all the time, which explains why he invests in small-cap stocks and holds them for years to unlock value.

Our Methodology

We scanned Berkshire Hathaway’s 13F portfolio for the third quarter of 2023 and picked the fund’s small-cap stock picks.

Warren Buffett Sees Big Gains in These Small-Cap Stocks

10. Liberty Latin America Ltd. (NASDAQ:LILA)

Market capitalization as of November 24: $1.42 Billion

Year-to-date gain: -9%

Number of Hedge Fund Holders: 14

Liberty Latin America Ltd. (NASDAQ:LILA) is a communication services company that offers communication and entertainment services, including video broadband internet, fixed line, and mobile services. Liberty Latin America Ltd. (NASDAQ:LILA) also provides subsea telecommunication services.

Liberty Latin America Ltd. (NASDAQ:LILA) is the smallest company by market cap on Berkshire Hathaway’s portfolio, offering exposure in the communication service segment.

9. Atlanta Braves Holdings, Inc. (NASDAQ:BATRA)

Market capitalization as of November 24: $2.27 Billion

Year-to-date gain: 21%

Number of Hedge Fund Holders: 11

Atlanta Braves Holdings, Inc. (NASDAQ:BATRA), based in Englewood, Colorado, operates and owns the Atlanta Braves Major League Baseball Club. Atlanta Braves Holdings, Inc. (NASDAQ:BATRA) also operates mixed-use development projects, including retail, office hotels and entertainment projects.

Atlanta Braves Holdings, Inc. (NASDAQ:BATRA) is one of the latest additions to Warren Buffett’s portfolio. Berkshire Hathaway acquired stakes worth $7.9 million in the company in Q3 2023. Atlanta Braves Holdings, Inc. (NASDAQ:BATRA) is up 21% year to date.

8. Louisiana-Pacific Corporation (NYSE:LPX)

Market capitalization as of November 24: $4.42 Billion

Year-to-date gain: 3.3%

Number of Hedge Fund Holders: 38

Louisiana-Pacific Corporation (NYSE:LPX) is a small-cap industrial company that provides solutions for use in new home construction, repair and re-modelling, and outdoor structures. Louisiana-Pacific Corporation (NYSE:LPX) offers LP SmartSide trim and siding products, LP SmartSide Expert Finish trim and siding products, and LP Builder Series lap siding products.

While Louisiana-Pacific Corporation (NYSE:LPX) has struggled with slowing demand for building products and choppy pricing, it has remained resilient, going by the 3.3% year-to-date gain. Buffett took an interest in the small-cap stock in Q3 2022 and has seen this investment gain by 10%. 

7. StoneCo Ltd. (NASDAQ:STNE)

Market capitalization as of November 24: $4.44 Billion

Year-to-date gain: 67%

Number of Hedge Fund Holders: 32

StoneCo Ltd. (NASDAQ:STNE) is one of Warren Buffett’s small-cap technology sector investment plays. The company provides financial technology and software solutions to merchants and integrated partners for conducting electronic commerce in-store, online, and mobile channels.

StoneCo Ltd. (NASDAQ:STNE) has become one of Buffett’s top small-cap picks, going by the 67% year-to-date gain. 

6. Jefferies Financial Group Inc. (NYSE:JEF)

Market capitalization as of November 24: $7.35 Billion

Year-to-date gain: 5.4%

Number of Hedge Fund Holders: 34

Jefferies Financial Group Inc. (NYSE:JEF) is another of Buffett’s small-cap plays in the financial services sector. The company engages in investment banking, capital markets, and asset management. Jefferies Financial Group Inc. (NYSE:JEF) provides banking advisory services for mergers or acquisitions, restructuring, or recapitalization. It also provides customers with investment-grade corporate bond sales and trading.

Jefferies Financial Group Inc. (NYSE:JEF) is up by about 5.4% for the year, as the financial service sector benefits from the high-interest rate environment. 

Click to continue reading and see Warren Buffett Sees Big Gains in These 5 Small-Cap Stocks.

Suggested articles:

Disclosure: None. Warren Buffett Sees Big Gains in These Small-Cap Stocks is originally published on Insider Monkey.

AI Fire Sale: Insider Monkey’s #1 AI Stock Pick Is On A Steep Discount

Artificial intelligence is the greatest investment opportunity of our lifetime. The time to invest in groundbreaking AI is now, and this stock is a steal!

The whispers are turning into roars.

Artificial intelligence isn’t science fiction anymore.

It’s the revolution reshaping every industry on the planet.

From driverless cars to medical breakthroughs, AI is on the cusp of a global explosion, and savvy investors stand to reap the rewards.

Here’s why this is the prime moment to jump on the AI bandwagon:

Exponential Growth on the Horizon: Forget linear growth – AI is poised for a hockey stick trajectory.

Imagine every sector, from healthcare to finance, infused with superhuman intelligence.

We’re talking disease prediction, hyper-personalized marketing, and automated logistics that streamline everything.

This isn’t a maybe – it’s an inevitability.

Early investors will be the ones positioned to ride the wave of this technological tsunami.

Ground Floor Opportunity: Remember the early days of the internet?

Those who saw the potential of tech giants back then are sitting pretty today.

AI is at a similar inflection point.

We’re not talking about established players – we’re talking about nimble startups with groundbreaking ideas and the potential to become the next Google or Amazon.

This is your chance to get in before the rockets take off!

Disruption is the New Name of the Game: Let’s face it, complacency breeds stagnation.

AI is the ultimate disruptor, and it’s shaking the foundations of traditional industries.

The companies that embrace AI will thrive, while the dinosaurs clinging to outdated methods will be left in the dust.

As an investor, you want to be on the side of the winners, and AI is the winning ticket.

The Talent Pool is Overflowing: The world’s brightest minds are flocking to AI.

From computer scientists to mathematicians, the next generation of innovators is pouring its energy into this field.

This influx of talent guarantees a constant stream of groundbreaking ideas and rapid advancements.

By investing in AI, you’re essentially backing the future.

The future is powered by artificial intelligence, and the time to invest is NOW.

Don’t be a spectator in this technological revolution.

Dive into the AI gold rush and watch your portfolio soar alongside the brightest minds of our generation.

This isn’t just about making money – it’s about being part of the future.

So, buckle up and get ready for the ride of your investment life!

Act Now and Unlock a Potential 10,000% Return: This AI Stock is a Diamond in the Rough (But Our Help is Key!)

The AI revolution is upon us, and savvy investors stand to make a fortune.

But with so many choices, how do you find the hidden gem – the company poised for explosive growth?

That’s where our expertise comes in.

We’ve got the answer, but there’s a twist…

Imagine an AI company so groundbreaking, so far ahead of the curve, that even if its stock price quadrupled today, it would still be considered ridiculously cheap.

That’s the potential you’re looking at. This isn’t just about a decent return – we’re talking about a 10,000% gain over the next decade!

Our research team has identified a hidden gem – an AI company with cutting-edge technology, massive potential, and a current stock price that screams opportunity.

This company boasts the most advanced technology in the AI sector, putting them leagues ahead of competitors.

It’s like having a race car on a go-kart track.

They have a strong possibility of cornering entire markets, becoming the undisputed leader in their field.

Here’s the catch (it’s a good one): To uncover this sleeping giant, you’ll need our exclusive intel.

We want to make sure none of our valued readers miss out on this groundbreaking opportunity!

That’s why we’re slashing the price of our Premium Readership Newsletter by a whopping 70%.

For a ridiculously low price of just $29, you can unlock a year’s worth of in-depth investment research and exclusive insights – that’s less than a single restaurant meal!

Here’s why this is a deal you can’t afford to pass up:

• Access to our Detailed Report on this Game-Changing AI Stock: Our in-depth report dives deep into our #1 AI stock’s groundbreaking technology and massive growth potential.

• 11 New Issues of Our Premium Readership Newsletter: You will also receive 11 new issues and at least one new stock pick per month from our monthly newsletter’s portfolio over the next 12 months. These stocks are handpicked by our research director, Dr. Inan Dogan.

• One free upcoming issue of our 70+ page Quarterly Newsletter: A value of $149

• Bonus Reports: Premium access to members-only fund manager video interviews

• Ad-Free Browsing: Enjoy a year of investment research free from distracting banner and pop-up ads, allowing you to focus on uncovering the next big opportunity.

• 30-Day Money-Back Guarantee:  If you’re not absolutely satisfied with our service, we’ll provide a full refund within 30 days, no questions asked.

 

Space is Limited! Only 1000 spots are available for this exclusive offer. Don’t let this chance slip away – subscribe to our Premium Readership Newsletter today and unlock the potential for a life-changing investment.

Here’s what to do next:

1. Head over to our website and subscribe to our Premium Readership Newsletter for just $29.

2. Enjoy a year of ad-free browsing, exclusive access to our in-depth report on the revolutionary AI company, and the upcoming issues of our Premium Readership Newsletter over the next 12 months.

3. Sit back, relax, and know that you’re backed by our ironclad 30-day money-back guarantee.

Don’t miss out on this incredible opportunity! Subscribe now and take control of your AI investment future!


No worries about auto-renewals! Our 30-Day Money-Back Guarantee applies whether you’re joining us for the first time or renewing your subscription a year later!

A New Dawn is Coming to U.S. Stocks

I work for one of the largest independent financial publishers in the world – representing over 1 million people in 148 countries.

We’re independently funding today’s broadcast to address something on the mind of every investor in America right now…

Should I put my money in Artificial Intelligence?

Here to answer that for us… and give away his No. 1 free AI recommendation… is 50-year Wall Street titan, Marc Chaikin.

Marc’s been a trader, stockbroker, and analyst. He was the head of the options department at a major brokerage firm and is a sought-after expert for CNBC, Fox Business, Barron’s, and Yahoo! Finance…

But what Marc’s most known for is his award-winning stock-rating system. Which determines whether a stock could shoot sky-high in the next three to six months… or come crashing down.

That’s why Marc’s work appears in every Bloomberg and Reuters terminal on the planet…

And is still used by hundreds of banks, hedge funds, and brokerages to track the billions of dollars flowing in and out of stocks each day.

He’s used this system to survive nine bear markets… create three new indices for the Nasdaq… and even predict the brutal bear market of 2022, 90 days in advance.

Click to continue reading…