- Berkshire Hathaway has outperformed the benchmark S&P 500 index in one year.
- A large part of its investment still goes to AAPL, BAC, AXP and KO.
- As of Dec 31, 2021, Berkshire Hathaway’s portfolio had more than 40 securities.
Most investors keep a watch on Warren Buffett’s investments. Buffet’s Berkshire Hathaway has outperformed the benchmark S&P 500 index in one year. Berkshire Hathaway’s stock returned 22.42% gains compared to the S&P 500’s annual return of 9.72%. As of Dec 31, 2021, its portfolio had more than 40 securities worth approximately US$330 billion.
The company delivered a compounded average annual gain of 20% since 1965, contrasting S&P 500’s 10.5% average return, according to Berkshire Hathaway’s letter to shareholders 2021.
Buffett’s largest holdings included Apple Inc. (AAPL), Bank of America (BAC), American Express Company, and The Coca-Cola Company (COKE) at the end of December 2021.
Also known as the Oracle of Omaha, Buffet’s every movement in the portfolio is keenly watched by wall street traders and investors.
Here we discuss five stocks from the portfolio that have remained positive so far this year.
American Express Company (NYSE: AXP)
Market Capitalization: US$128 billion
Closing price on March 09, 2022: US$168.65
New York-based American Express is a financial institution that offers payment products to consumers and businesses worldwide. The company also provides expense management tools, business loans, and consulting services.
AXP has been a part of Buffet’s portfolio since 1993.
On March 10, the company’s board of directors approved around a 20% increase to US$0.52 in the quarterly dividend payable on May 10 to shareholders of record on April 8, 2022.
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It recorded a net income of US$8.06 billion or US$10.02 per diluted share on revenue of US$42.38 billion for the fiscal year ended December 31, 2021. The revenue and net income for the previous fiscal year were US$36.09 billion and US$3.13 billion, respectively.
Boosted by its strong cash-generating abilities, AMX has been paying dividends consistently. Its current dividend yield is 1.07%, and its annualized dividend is US$1.72. The stock touched the highest and lowest of US$199.55 and US$135.12 in the last 52 weeks.
Chevron Corporation (NYSE: CVX)
Market Capitalization: US$323.8 billion
Closing price on March 09, 2022: US$166.27
Chevron is an integrated oil company with global exploration, production, and refining operations. It is based in San Ramon, California. Its proven reserves were 11.3 billion barrels of oil equivalents at the end of 2021.
On Feb 28, Chevron announced entering a definitive agreement to acquire Renewable Energy Group, Inc. (REGI) for US$3.15 billion in an all-cash transaction.
For the fiscal year 2021, its revenue was US$162.5 billion compared to US$94.69 billion for the previous fiscal. Chevron’s net income was US$15.63 billion or US$8.14 per share diluted against a net loss of US$5.54 billion or US$2.96 per share diluted.
The company has raised its share-buyback guidance in the range of US$5 to US$10 billion per year and increased the capital employed target to 12% by 2026.
Its dividend yield is 3.33%, and its annualized dividend is US$5.68.
Activision Blizzard, Inc. (NASDAQ: ATVI)
Market Capitalization: US$62.9 billion
Closing price on March 09, 2022: US$80.83
Video game publisher Activision Blizzard made games like World of Warcraft and Call of Duty. In January this year, Microsoft announced to buy the company for US$75 billion.
Santa Monica, California-based Activision has big investors like Berkshire Hathaway, which purchased around US$1 billion worth of stake or 14.7 million shares in Q4, 2021.
The company has nearly 10,000 employees worldwide.
Activision generated revenue of US$8.8 billion in FY 2021, a 9% increase YoY compared to the revenue of US$8.1 billion in fiscal 2020. The net income grew to US$2.7 billion compared to US$2.2 billion in fiscal 2020. Its earnings per share diluted increased by 22% to US$3.44 per share diluted, compared to US$2.82 per share diluted in FY 2020.
Its dividend yield is 0.58%, and its annualized dividend is US$0.47. Its stock traded in the price range of US$99.46 to US$56.40.
Occidental Petroleum Corporation (NYSE: OXY)
Market Capitalization: US$54.04 billion
Closing price on March 09, 2022: US$57.5
The independent exploration and production company Occidental Petroleum Corporation has operations in the US, Latin America, and the Middle East. It’s headquartered in Houston, Texas.
The company bagged a US$4.5 billion investment from Berkshire Hathaway. Buffet raised the stake after its Q4 and full-year results transcript. Berkshire now holds around 10% of the stake in Occidental, including warrants and stocks.
For the fiscal year 2021, occidental reported net sales of US$18.94 billion and net income of US$2.32 billion or US$1.58 per diluted share. The net sales for fiscal 2020 were US$17.8 billion, and net loss was US$14.8 billion or US$17.06 per diluted share.
The energy company has declared the quarterly dividend of US$0.13, payable on April 15, 2022, to stockholders of record on March 10, 2022.
Its dividend yield is 0.07%, and its annualized dividend is US$0.52. OXY stock traded between US$58.77 and US$21.62 in one year.
Kroger Company (NYSE: KR)
Market Capitalization: US$41.32 billion
Closing price on March 09, 2022: US$55.34
Cincinnati, Ohio-based Kroger is a grocer company that runs more than 2,700 supermarkets under various banners.
For fiscal 2021, its identical sales excluding fuel increased by 0.2%. The company reported EPS of US$2.17 and an adjusted EPS of US$3.68 for FY 2021. Its operating profit came in at US$3.5 billion.
The company expects identical sales growth of 2.0% to 3.0%, excluding fuel, and adjusted EPS of US$3.75 to US$3.85 in fiscal 2022.
Its dividend yield is 1.51%, and its annualized dividend is US$0.84. Its stock traded in the range of US$62.58 to US$34.21 in the last 52 weeks.
Berkshire reduced its exposure in the pharmaceutical companies in the last quarter of 2021 and sold out stakes in Teva and Abbvie, according to its latest filings. According to Warren Buffett: “Diversification Preserves Wealth but Concentration Build Wealth.”