If any investor has stood the test of time, it is Warren Buffett. For years, the “Oracle of Omaha” has had a rock-star-like presence in the investing world. His annual Berkshire Hathaway shareholders meeting draws literally thousands of loyal fans who are investors. Known for his long buy-and-hold strategies and his massive portfolio of public and private holdings, Buffett remains one of the preeminent investors in the entire world.
While the rally since the beginning of the year has been a welcome relief for beleaguered investors, there are some dark clouds on the economic horizon. Investors need to be very wary of massive layoffs, manufacturing slowing, inflation raising its head again, geopolitical issues with China, the ongoing Russia-Ukraine war and more.
We screened the Berkshire Hathaway portfolio looking for companies that appear well positioned in the current higher interest rate environment and likely to hold up better should we retest the lows printed back in October. While the following seven stocks are rated Buy across Wall Street, it is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
Citigroup
This top bank has rallied nicely off the lows, and Warren Buffett bought a massive $2.5 billion worth of shares last summer. Citigroup Inc. (NYSE: C) is a leading global diversified financial service company that provides consumers, corporations and governments a broad range of financial products and services.
It offers services such as consumer banking and credit, corporate and investment banking, securities brokerage, transaction services and wealth management. It operates and does business in more than 160 countries and jurisdictions in North America, Latin America, Asia and elsewhere.
Trading at a still very cheap 7.6 times estimated 2023 earnings, this stock looks very reasonable in what remains a volatile stock market and in a sector that has dramatically lagged.
Investors receive a 4.06% dividend. Oppenheimer’s $87 price target is a Wall Street high. The consensus target is $58.51, and Citigroup stock closed trading on Monday at $51.00.
Coca-Cola
This remains a top Buffet holding, as he owns 400 million shares. Coca-Cola Co. (NYSE: KO) is the world’s largest beverage company, refreshing consumers with more than 500 sparkling and still brands. It has an incredibly strong worldwide brand, with 40% overseas sales.
The company’s portfolio features 20 billion-dollar brands including Diet Coke, Fanta, Sprite, Coca-Cola Zero, vitaminwater, Powerade, Minute Maid, Simply, Georgia and Del Valle. Globally, it is the number one provider of sparkling beverages, ready-to-drink coffees and juices and juice drinks.
Through the world’s largest beverage distribution system, consumers in more than 200 countries enjoy Coca-Cola beverages at a rate of more than 1.9 billion servings a day. Also remember that the company also owns 16.7% of Monster Beverage, which continues to deliver big numbers.
Coca-Cola stock investors receive a 2.95% dividend. Wells Fargo has a $70 target price, and the consensus target is $68.48. The final trade on Monday was for $60.60 a share.
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