Bob Harris
1
All posts from Bob Harris
Bob Harris in Bob Harris,

Warren Buffett's Top 5 Stocks for 2014

Warren Buffett is considered the most respected and successful investor. Often called "The Oracle of Omaha" for his impressive investing prowess, he is among the world's wealthiest people.

Buffett studied under the legendary Benjamin Graham at Columbia University who had a major impact on Buffett's life and investment strategies.

Buffett is chairman of Omaha, Nebraska-based Berkshire Hathaway Inc (BRK.A_) which he built from a textile company into a major corporation with a market cap over $200 billion. Under Buffett's leadership, Berkshire shares averaged a 21.4% compounded annual gain in per share book value from 1965-2006.

He follows a value investing strategy that is an adaptation of Graham's approach: Discipline, patience and value consistently outperforms the market. His moves are followed by investors worldwide. Buffett seeks to acquire great companies trading at a discount to their intrinsic value, and to hold onto them for a long time. He will only invest in businesses that he understands, and always insists on a margin of safety.

Regarding the types of businesses Berkshire likes to purchase, Buffett has said,"We want businesses to be one that we can understand, with favorable long-term prospects, operated by honest and competent people, and available at a very attractive price."

What follows are Buffett's top 5 holdings as of March 31, 2014.

1. Wells Fargo & Co (WFC_)

Shares Held by Warren Buffett's Berkshire Hathaway:  463,458,000
Value of Holdings:  $23.05 billion
Portfolio Weighting as of 3/31/2014:  21.8%

Wells Fargo & Co is a diversified financial services company. It provides retail, corporate and commercial banking services through banking stores and offices, the internet and other distribution channels to individuals, businesses and institutions.

TheStreet Ratings team rates WELLS FARGO & CO as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation: 

"We rate WELLS FARGO & CO (WFC) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, expanding profit margins, notable return on equity and increase in net income. We feel these strengths outweigh the fact that the company shows weak operating cash flow."

2. Coca-Cola (KO_)

Shares Held by Warren Buffett's Berkshire Hathaway:  400,000,000
Value of Holdings: $15.46 billion
Portfolio Weighting as of 3/31/2014:  14.6%

Coca-Cola Co manufactures, distributes and markets non-alcoholic beverage concentrates and syrups.

TheStreet Ratings team rates COCA-COLA CO as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation: 

"We rate COCA-COLA CO (KO) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, expanding profit margins, reasonable valuation levels and notable return on equity. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."

3. American Express Co (AXP_)

Shares Held by Warren Buffett's Berkshire Hathaway:  151,611,000
Value of Holdings:  $13.65 billion
Portfolio Weighting as of 3/31/2014:  12.9%

American Express Co is a payments, network and travel company, which offers credit payment card products and travel-related services to consumers and businesses.

TheStreet Ratings team rates AMERICAN EXPRESS CO as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation: 


"We rate AMERICAN EXPRESS CO (AXP) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, impressive record of earnings per share growth, increase in net income and solid stock price performance. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

4. International Business Machines Corp (IBM_)

Shares Held by Warren Buffett's Berkshire Hathaway:  68,355,000
Value of Holdings:  $13.15 billion
Portfolio Weighting as of 3/31/2014:  12.4%

International Business Machines Corp is an Information Technology (IT) company. It creates business value for clients and solves business problems through integrated solutions that leverage information technology & knowledge of business processes.

TheStreet Ratings team rates INTL BUSINESS MACHINES CORP as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation: 

"We rate INTL BUSINESS MACHINES CORP (IBM) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its notable return on equity and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

5. Wal-Mart Stores Inc. (WMT_)

Shares Held by Warren Buffett's Berkshire Hathaway:  58,052,000
Value of Holdings:  $4.43 billion
Portfolio Weighting as of 3/31/2014:  4.2%

Wal-Mart Stores Inc, operates retail stores in various formats under various banners. Its operations comprise of three reportable business segments, Walmart U.S., Walmart International and Sam's Club in three categories retail, wholesale and others.

TheStreet Ratings team rates WAL-MART STORES INC as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation: 

"We rate WAL-MART STORES INC (WMT) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations, reasonable valuation levels, increase in stock price during the past year and notable return on equity. We feel these strengths outweigh the fact that the company shows low profit margins."

Source: http://www.thestreet.com/