Berkshire Hathaway(NYSE: BRK.A)(NYSE: BRK.B) owns one of the world's most closely watched investment portfolios since it contains dozens of stocks and exchange-traded funds (ETFs) that were approved by famed investor Warren Buffett. So if you're shopping for new stocks, it might just be a good idea to check in on what the Oracle of Omaha is buying.
Berkshire sold a lot of stocks over the past year to boost its cash to record levels, which sparked some speculation that Buffett was bracing for a market downturn. However, Berkshire continues to hold plenty of evergreen stocks that can generate stable returns for long-term investors. I believe three of those top holdings are still worth buying right now: Apple(NASDAQ: AAPL), Coca-Cola (NYSE: KO), and Amazon(NASDAQ: AMZN).
Berkshire Hathaway CEO Warren Buffett. Image source: The Motley Fool.
1. Apple
Berkshire started to accumulate shares of Apple in 2016. It sold more than two-thirds of its shares over the past year, but its remaining $70 billion stake in Apple still accounts for over a fifth of its portfolio and remains its largest single investment.
Apple is heavily dependent on the iPhone and its sales growth has cooled off over the past few years, but it still has a strong brand, plenty of pricing power, a sticky ecosystem, and a wide moat. It ended its latest quarter with $157 billion in cash and marketable securities, which gives it plenty of room to expand its business with fresh investments and acquisitions. It bought back 35% of its shares over the past decade, and it's raised its dividend for 13 straight years.
For fiscal 2025 (which ends in September 2025), analysts expect Apple's revenue and earnings per share (EPS) to grow 8% and 10%, respectively. That growth should be driven by its steady iPhone sales, the expansion of its services ecosystem, and its rollout of new generative artificial intelligence (AI) services. Apple's stock isn't cheap at 30 times forward earnings, and it pays a paltry forward yield of 0.5%, but it should remain a stable safe-haven stock in bull and bear markets.
2. Coca-Cola
Berkshire started to invest in Coca-Cola in 1988. It hasn't bought or sold any more shares over the past 12 years, but its $26 billion stake in the beverage leader accounts for 8.5% of its entire portfolio and ranks as its fourth-largest investment.
Over the past few decades, Coca-Cola countered declining soda consumption rates by launching and acquiring more brands of bottled water, teas, juices, sports drinks, coffee, and even alcoholic drinks. It also refreshed its sodas with new flavors, smaller serving sizes, and healthier versions. That evolution enabled Coca-Cola to consistently grow its organic sales and maintain its status as a Dividend King with 62 consecutive years of dividend increases. It also bought back about 15% of its shares over the past 30 years.
For 2024, Coca-Cola expects its organic sales to grow 10% as its comparable EPS rises 5% to 6%. Analysts expect its reported revenue and EPS to grow 9% and 14%, respectively. For 2025, they expect its revenue and EPS to both rise 4%. It still faces significant headwinds from inflation and a strong dollar, but it's successfully offset a lot of that pressure with price hikes over the past two years. Coca-Cola's stock still looks reasonably valued at 22 times forward earnings, and its forward dividend yield of 3% should become even more attractive as interest rates decline.
3. Amazon
Berkshire started to invest in Amazon in 2019. It trimmed its position in 2023, but it still holds a $2 billion stake, which accounts for 0.6% of its portfolio. As the world's largest e-commerce and cloud infrastructure platform company, Amazon is a cash-generating behemoth with a wide moat. It also subsidizes the expansion of its lower-margin retail business with its higher-margin cloud business, which gives it a unique edge against many of its retail competitors.
Amazon's growth accelerated during the pandemic as more people shopped online and more companies upgraded their cloud services. But its growth cooled off over the past two years as it lapped that temporary growth spurt and faced tougher macro headwinds.
That slowdown spooked the bulls, but Amazon's growth has stabilized over the past year as the macro environment stabilized. Its e-commerce business recovered as it sped up its deliveries, sold more everyday essentials, and expanded into more overseas markets. Its cloud growth accelerated again as more companies upgraded their cloud infrastructure to handle the latest generative AI applications.
Analysts expect Amazon's revenue and EPS to grow 11% and 63%, respectively, this year. In 2025, they expect its revenue and EPS to increase by 11% and 22%, respectively, as its near-term headwinds dissipate. Its stock might not seem like a bargain at 34 times forward earnings, but it's historically cheap and will remain a top play on the secular growth of the e-commerce and cloud markets for the foreseeable future.
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Leo Sun has positions in Amazon, Apple, and Berkshire Hathaway. The Motley Fool has positions in and recommends Amazon, Apple, and Berkshire Hathaway. The Motley Fool has a disclosure policy.
