Warren Buffett’s Berkshire Hathaway (NYSE: BRK.A) has made a significant move by reducing its stake in Bank of America (NYSE: BAC) for the first time since 2019.
According to a filing, Berkshire sold 33.9 million shares of BAC stock over three days in July, garnering nearly $1.5 billion at an average selling price of $43.56 per share.
Despite this substantial sale, Bank of America remains a cornerstone in Berkshire’s $398 billion portfolio, holding its position as the second-largest investment.
Picks for you
This strategic shift has left investors speculating about potential additions to Berkshire’s portfolio. In this context, Finbold has identified two Warren Buffett stocks to consider, namely Moody’s Corporation (NYSE: MCO) and Amazon (NASDAQ: AMZN).
Both companies present strong investment potential, backed by solid financial metrics and strategic market positions, making them compelling options for future investments.
Moody’s Corporation (NYSE: MCO) stock
Moody’s Corporation ranks as Berkshire’s eighth-largest holding, with 24,669,778 shares valued at approximately $9.7 billion. Moody’s has demonstrated robust financial performance, reporting a 22% year-over-year increase in revenue to $1.8 billion and a 47% jump in earnings per share to $3.02 for the second quarter of 2024.
The company’s Investor Services division achieved a 36% revenue growth, highlighting its strong market position.
Moody’s has also formed strategic partnerships with industry giants like MSCI Inc (NYSE: MSCI), Zillow, Alphabet (NASDAQ: GOOG), and Diligent, which are set to broaden its market reach and enhance its product offerings.
Despite its high valuation, Moody’s sustained growth and strategic initiatives make it a compelling long-term investment. With a market cap of $82.64 billion and an enterprise value of $88.53 billion, Moody’s remains a formidable player in the credit ratings industry.
Amazon (NASDAQ: AMZN) stock
Amazon is the 17th largest holding in Berkshire’s publicly traded portfolio, with a total stake of 10 million shares worth roughly $1.8 billion.
Amazon reported impressive second-quarter earnings for 2024, with adjusted earnings per share of $1.26, surpassing analyst estimates of $1.03.
Although revenue of $148 billion slightly missed the consensus estimate, it still marked a 10% year-over-year increase. Amazon Web Services (AWS), the company’s cloud computing segment, continued its robust growth, with sales up 19% year-over-year to $26.3 billion.
Despite some short-term challenges, Amazon’s diversified business model, strong market presence, and continued innovation position it well for future growth.
With its vast e-commerce platform and expanding cloud services, Amazon offers significant investment potential.
As Berkshire Hathaway reduces its stake in Bank of America, investors might find attractive opportunities in Moody’s Corporation and Amazon, both of which align with Warren Buffett’s investment philosophy of acquiring solid companies with strong financial performance and strategic growth prospects.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
