Warren Buffett’s 10 Longest-Held Stocks

6. DaVita Inc. (NYSE:DVA)

Warren Buffett’s First Major Purchase: 2011 

Berkshire Hathaway’s stake in Q3 2024: $5.91 billion

DaVita Inc. (NYSE:DVA) is a leading U.S. provider of kidney dialysis services, operating 2,675 outpatient centers domestically and 367 locations across 11 countries. DaVita Inc. (NYSE:DVA) has long been a favorite in Warren Buffett’s portfolio. Berkshire Hathaway has held a stake in the company since the last quarter of 2011, making it one of Buffett’s enduring picks in the healthcare sector.

The company has been actively expanding its global presence, particularly in Latin America, through strategic acquisitions. In March 2024, DaVita announced a $300 million deal involving four acquisitions from Fresenius Medical Care, enabling entry into the Chilean and Ecuadorian markets, while strengthening operations in Brazil and Colombia.

The kidney dialysis provider reported Q3 adjusted earnings per share of $2.59, missing the $2.72 consensus estimate, while revenue slightly beat expectations at $3.26 billion compared to $3.25 billion. In its U.S. dialysis segment, DaVita Inc. (NYSE:DVA) generated $549 million in operating income on $2.91 billion in revenue and performed 7.35 million dialysis treatments, marking a slight 0.1% drop from the previous quarter. The company also repurchased 2.7 million shares at an average of $147.20 each, closing the quarter with $1.07 billion in cash and cash equivalents.

For the rest of 2024, DaVita Inc. (NYSE:DVA) reaffirmed its guidance for adjusted operating income of $1.91 billion to $2.01 billion and expects adjusted diluted earnings per share between $9.25 and $10.05.

Here’s what Ariel Global Fund mentioned about DaVita Inc. (NYSE:DVA) in its Q1 2024 investor letter:

“Leading provider of dialysis services, DaVita Inc. (NYSE:DVA) outperformed during the period following a top- and bottom-line earnings beat. DaVita is benefitting from cost saving initiatives, early signs of a normalization in patient growth trends on par with pre-pandemic levels, improved leverage and an aggressive share buyback program. The company also recently announced an expansion of its international operations in Latin America, presenting an attractive long-term growth opportunity. Furthermore, management provided a 2024 financial outlook which is well above consensus and anticipates favorable growth. In our view, we believe the market misunderstands the long-term clinical impact of glucagon-like-peptide-1 (GLP-1s) on dialysis and as such, DaVita currently trades at a significant discount relative to our estimate of its intrinsic value.”