The 2 Attractive Stocks in Warren Buffett’s Portfolio to Watch Now
Famed investor Warren Buffett, also known as the “Oracle of Omaha,” is the chairman and CEO of Berkshire Hathaway Inc. (BRK.A, BRK.B). His long-term investment strategy has worked out well in his favor, making him the world’s fifth richest person. As of December 7, his real-time net worth stood at $106.70 billion.
BRK.A has outpaced the broader market over the past year, gaining 9.1%, while the broader S&P 500 index has declined 12.9%. Moreover, over the past month, BRK.A is up 7.6%, outpacing the S&P 500’s gain of 6.1% over the same period.
Amid the current macroeconomic headwinds and recessionary fears, investors could consider Warren Buffett stocks Diageo plc (DEO) and Activision Blizzard, Inc. (ATVI) for adding to their watchlists now.
Diageo plc (DEO)
Headquartered in London, U.K., DEO, together with its subsidiaries, produces, markets, and sells alcoholic beverages. It operates in North America, Europe, Turkey, Africa, Latin America, the Caribbean, the Asia Pacific, and internationally.
On November 29, DEO’s Crown Royal announced that in partnership with Salesforce NFT Cloud, Crossmint, and Vayner3 would expand its tradition of generosity into Web3 through the launch of the brand’s first digital collectible.
Sophie Kelly, Sr. Vice President of Whiskeys Portfolio in North America at Diageo, said, “We’re excited to use web3 technology to not only help consumers recognize special people in their lives who deserve gratitude, but also to support active-duty service members through the Purple Bag Project.”
On November 2, DEO announced its acquisition of Balcones Distilling, a Texas craft distiller and one of the leading producers of American Single Malt Whisky in the United States. The company expects this acquisition to support further growth in its premium whiskey segment.
DEO’s net sales increased 21.4% year-over-year to £15.45 billion ($18.94 billion) in the quarter ended June 30, 2022. Adjusted EBITDA increased 26% year-over-year to £5.70 billion ($6.99 billion) for the same quarter. Its earnings per share before exceptional items stood at 151.4 pence, up 29.3% year-over-year.
Its total current assets stood at £12.93 billion ($15.85 billion) as of June 30, 2022, compared to £11.45 billion ($14.03 billion) as of June 30, 2021.
The consensus EPS estimate of $8.38 for the fiscal year ending June 2023 represents a 14.9% year-over-year improvement. The consensus revenue estimate of $21.21 billion for the same year represents a 12.8% increase from the prior year.
DEO has gained 8.3% over the past three months to close the last trading session at $188.89. It has gained 10.8% over the past month.
The stock has an overall rating of B, translating to Buy in our POWR Ratings system. The POWR Ratings are calculated by considering 118 distinct factors, each weighted to an optimal degree.
DEO has a B grade for Growth, Sentiment, and Quality. It is ranked #15 out of 34 stocks in the A-rated Beverages industry.
Beyond what is stated above, we’ve also rated DEO for Value, Momentum, and Stability. Click here to get all DEO ratings.
Activision Blizzard, Inc. (ATVI)
ATVI develops and publishes interactive entertainment content and services across various gaming platforms, through subscription, full-game, and in-game sales and by licensing software to third-party or related-party companies that distribute Activision and Blizzard products.
ATVI’s Call of Duty®: Modern Warfare® II smashed franchise records as the new game has crossed $1 billion in worldwide sell-through following the first ten days from its release on October 28, 2022.
ATVI’s total net revenues for its fiscal third quarter, ended September 30, 2022, came at $1.78 billion. While its non-GAAP net income came in at $539 million, its non-GAAP EPS came at $0.68. The total current assets of ATVI came at $13.11 billion as of September 30, 2022, compared to $12.56 billion as of December 31, 2021.
Analysts expect ATVI’s EPS to grow 20% year-over-year for the fiscal fourth quarter ending December 2022 to $1.50. Its revenue is expected to grow 26.5% year-over-year to $3.15 billion in the same quarter.
ATVI has gained 14.4% year-to-date to close the last trading session at $76.11. It has gained 5.8% over the past month.
ATVI has a B grade for Sentiment and Quality. Of the 21 stocks in the Entertainment – Toys & Video Games industry, ATVI is ranked #9.
Beyond what we have stated above, our POWR Ratings system has also rated ATVI for Growth, Value, Stability, and Momentum. Get all ATVI ratings here.
DEO shares were trading at $188.52 per share on Wednesday afternoon, down $0.37 (-0.20%). Year-to-date, DEO has declined -12.72%, versus a -16.30% rise in the benchmark S&P 500 index during the same period.