Warren Buffett, the legendary investor and CEO of Berkshire Hathaway (NYSE: BRK.A), is a symbol of financial wisdom and success. Ranked as the tenth-richest person in the world by the Bloomberg Billionaires Index, Buffett’s investment acumen is globally recognized.
Finbold analyzed the current market conditions and growth prospects of various stocks in Buffett’s portfolio to identify two with a strong buy rating for July 2024.
Visa Inc. (NYSE: V) stock
Visa (NYSE: V) has shown resilient double-digit growth and is poised to sustain this momentum. Despite a modest revenue slowdown in the past year, Visa’s recent results have reignited investor confidence.
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The company’s Q2 results highlight impressive revenue growth of 9.9%, driven by strong payment volumes, increased processed transactions, and higher cross-border volume.
Visa’s global payment volume increased by 8% year-over-year, while processed transactions grew by 11% year-over-year, highlighting the steady rise in transactions handled by Visa’s network, according to sources.
Visa is capitalizing on a global market opportunity of $20 trillion in consumer payments, expanding its tap-to-pay business, and targeting automated clearing house (ACH) payments to replace traditional check payments.
The company’s New Flows segment, which includes alternative payments like Visa Direct, saw a revenue increase of 14% year-over-year, with transactions up by 31%.
Visa’s current valuation metrics highlight its strong financial health and growth potential. The company has a market capitalization of $510.91 billion and an enterprise value of $516.25 billion.
The price-to-earnings (P/E) ratio stands at 32.04, indicating that investors are willing to pay a premium for Visa’s earnings due to its robust growth prospects. The forward P/E ratio of 25.44 further underscores the expected growth in earnings
Based on 22 Wall Street analysts offering 12-month price targets for Visa in the last three months, the average price target is $316.63, with a high forecast of $345.00 and a low forecast of $275.00. This represents a 17.11% change from the last price of $270.36, reinforcing Visa’s status as a strong buy.
Snowflake Inc. (NYSE: SNOW) stock
Snowflake (NYSE: SNOW) developed its Data Cloud to help businesses aggregate their critical data onto one platform, where it can be analyzed more effectively to extract its maximum value.
The service was designed for use by large, complex organizations that work with multiple cloud providers, a situation that often leads to the creation of data silos. Last year, Snowflake launched its Cortex AI platform, allowing businesses to combine ready-made large language models (LLMs) with their own data to create generative AI applications.
Snowflake’s current valuation metrics reflect its potential for significant growth in the data cloud market. The company has a market capitalization of $45.87 billion and an enterprise value of $40.23 billion.
The price-to-sales (P/S) ratio is 23.60, indicating that investors are paying a high premium for the company’s revenue due to its high growth potential. The forward P/S ratio of 16.11 suggests expectations of continued strong revenue growth.
Based on 33 Wall Street analysts offering 12-month price targets for Snowflake in the last three months, the average price target is $203.59, with a high forecast of $240.00 and a low forecast of $160.00.
This represents a 42.35% change from the last price of $143.02, underscoring Snowflake’s potential as a strong buy.
For investors seeking strong growth opportunities, both Visa and Snowflake present compelling options. Visa’s steady performance in the payment processing industry and its ongoing innovations ensure robust, long-term growth.
Snowflake’s dominance in the data cloud market, supported by strategic AI initiatives and key partnerships, positions it well for future expansion.
Aligning with Warren Buffett’s investment philosophy, Visa and Snowflake offer a blend of stability and innovation, making them attractive choices for your portfolio.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
