3 Battered Warren Buffett Stocks to Buy for a Bargain


  • Some Warren Buffett stocks are starting to look cheap, even as the rest of the market flies.
  • Apple (AAPL): Apple stock is nearing correction territory as the rest of big tech flies north.
  • Sumitomo (SSUMY): One of the most intriguing Japanese trading companies may be every bit as wonderful as it seems.
  • Berkshire Hathaway (BRK-B)(BRK-A): There’s no better Buffett stock than Berkshire Hathaway itself, as it looks to add to recent quarterly strength.
Warren Buffett stocks - 3 Battered Warren Buffett Stocks to Buy for a Bargain

Source: Kent Sievers / Shutterstock.com

Warren Buffett is a brilliant investor from which all beginners could learn a great deal. Undoubtedly, long-term value investing is his game. Most other market newcomers are lured in by the hot stock du jour. However, Buffett’s investment philosophy teaches discipline and investing in a way to improve one’s risk-adjusted returns. This is why so many investors flock to Warren Buffett stocks.

Indeed, there are many ways to build your wealth. However, if you can build it in a way that minimizes risk, you could be well-equipped to do even better. Indeed, one can also minimize their chances of dropping the ball on stocks we just incorrectly analyze. They do this by ensuring an appropriate margin of safety—a term coined by Buffett’s teacher, Ben Graham.

Apart from keeping tabs on wisdom dropped by Buffett during the annual Berkshire Hathaway (NYSE:BRK-B)(NYSE:BRK-A) shareholder meetings, beginners may also look underneath the hood of the legendary conglomerate’s investment portfolio. There are “wonderful” businesses in the group, and, on occasion, some may also trade at fair prices. Let’s check in with three Warren Buffett stocks that look cheap going into March.

Apple (AAPL)

Close-up of Apple (AAPL) retail store Logo in Honolulu at the Ala Moana Center. Advertising the latest generation of the ipad, iphones, and ipods with a Retina display.
Source: Eric Broder Van Dyke / Shutterstock.com

Apple (NASDAQ:AAPL) stock has been trending lower of late after the week’s news that the firm is calling it quits with Project Titan, its secretive auto project.

For years, Apple’s electric and autonomous vehicle ambitions have fuelled rampant speculation for when and how the firm can compete with the likes of some heavyweight contenders in the EV scene. Though Apple may never see a decent return on its Project Titan investments, don’t count on CEO Tim Cook to remark on a project that Apple never admitted it was actually working on!

As a standout overweight holding in Berkshire’s portfolio, Apple is always worth consideration whenever it pulls back considerably. Now down around 9% from its all-time high, shares suddenly look tempting as Apple cuts its losses with Project Titan.

Of course, Berkshire recently trimmed around $2 billion worth of AAPL shares in the latest quarter. However, it’s unclear if it was Buffett himself that did the selling. Either way, the recent share sale represents just 1% of the total stake — a mere drop in the bucket that shouldn’t alarm Apple shareholders. When people talk about Warren Buffett stocks, Apple comes up just about every time.

Sumitomo (SSUMY)

an aerial view of Tokyo, Japan
Source: Shutterstock

Berkshire and Buffett have been making moves in Japan of late, and it’s caught the attention of Berkshire watchers. Undoubtedly, Buffett has been adding to its stake in five major Japanese companies in recent years. Sumitomo (OTCMKTS:SSUMY) is one of the most intriguing of the five, in my opinion. Shares of the Japan-based trading company are available to investors via over-the-counter (OTC) markets and go for a pretty reasonable price of admission.

Though Berkshire seems limited to under 10% ownership in the firm (and the other four Japanese firms in which the firm owns shares) for the time being, I’d not be surprised if the stake goes higher should Sumitomo’s management give the green light.

Indeed, Sumitomo stands out as a “wonderful” company with a vast range of intriguing businesses, ranging from energy to infrastructure. If you’ve got the patience, a nose for value, and a willingness to explore Japanese investments via the OTC markets, perhaps shares are worth watching.

Berkshire Hathaway (BRK-B)(BRK-A)

The logo for Berkshire Hathaway displayed on a smartphone screen.
Source: sdx15 / Shutterstock.com

There’s no better Buffett stock than Berkshire Hathaway, especially as the stock looks to heat up and hit new highs, with the class B shares looking to blast off past $410 per share. The company’s latest quarterly earnings results (which, as usual, were released over the weekend) were pretty solid, with operating profit rising by an impressive 28% to $8.48 billion.

Though BNSF (Berkshire’s wholly-owned railroad) wasn’t firing on all cylinders, insurance (GEICO in particular) fared quite well. As the underwriting track record improves, the insurance business could continue to flex its muscles.

Perhaps the biggest takeaway from the latest quarter was the swelling cash reserves, with another record pile of $167.6 billion as of the conclusion of the fourth quarter. Once again, the headlines have been revolving around what the conglomerate plans to do with its mountain of cash. It could make a massive deal, perhaps a needle-moving one. But for now, don’t expect Berkshire to be too hasty. Not with market valuations a tad on the high end.

On the date of publication, Joey Frenette owned shares of Berkshire Hathaway (class B) and Apple. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Joey Frenette is a seasoned investment writer specializing in technology and consumer stocks. Contributing to the Motley Fool Canada, TipRanks, and Barchart, Joey excels in spotting mispriced stocks with long-term growth potential in a fast-paced market.

Article printed from InvestorPlace Media, https://investorplace.com/2024/03/3-battered-warren-buffett-stocks-to-buy-for-a-bargain/.

©2024 InvestorPlace Media, LLC