The so-called Warren Buffett equities have all the makings of great buy-and-hold investments — except that the world-famous investor does not own them. In 2021, the stock market had an absolutely record-breaking year, with the S&P 500 index ending the year up more than 25%. Despite the fact that interest rate rises are projected in 2022, early predictions from Wall Street banks show growth in the high single digits in 2022.
Taking a leaf from Warren Buffett’s investment playbook in the face of tighter market conditions and lower expectations might not be a terrible idea. The “Oracle of Omaha” focuses on simple business models, resilient industries, and strong economic moats to find value stocks that generate fantastic long-term returns as CEO of Berkshire Hathaway Inc. (ticker: BRK.B, BRK.A), and the following seven stocks appear to be perfect additions to Buffett’s stock portfolio.
Albertsons Cos. Inc. (ACI)
Albertsons is one of the country’s largest grocery and medicine retailers, with 2,278 locations under the Tom Thumb and Safeway banners in 34 states. Consumers filled their pantries and chose to eat at home in 2020, resulting in an 11.6 percent increase in sales. While sales dropped 1.9 percent in the first half of 2021, it was far less than projected, demonstrating the persistence of food-at-home trends and their capacity to drive top-line growth.
Capital One Financial Corp. (COF)
Capital One Financial is the country’s fifth-largest consumer bank and the eighth-largest bank overall, with three business segments: credit cards, consumer banking, and commercial banking. Despite falling roughly 18% from its mid-August highs, the stock is still up about 50% through late December, trading at $146 per share.
Procter & Gamble Co. (PG)
Procter & Gamble is the world’s largest consumer staples firm, with a market capitalization of about $400 billion. Pampers, Tide, Gillette, Old Spice, Swiffer, and Oral-B are just a few of the notable brands it owns. Buffett owned about $4 billion in PG shares until 2016 when he sold it to fund Berkshire Hathaway’s entire purchase of Duracell, a former PG brand.
Oracle Corp. (ORCL)
Buffett invested $2.1 billion in Oracle shares in 2019 but sold it a quarter later, claiming a lack of understanding of the company’s business strategy. Oracle is a company that provides information technology services to businesses. It was founded in 1977 by Larry Ellison. Oracle has had a strong year, rising over 37%, and now trades at $88 per share, considerably below analysts’ average target price of $103 per share.
General Mills Inc. (GIS)
General Mills is another consumer staples firm that manufactures well-known grocery and convenience store brands, including Pillsbury, Cheerios, Häagen-Dazs, Nature Valley, and Yoplait. In fact, General Mills caters to more than 95% of American households, demonstrating its broad market reach and brand appeal. While second-quarter results fell short of forecasts, the net sales outlook for 2022 was revised higher, from a drop of 1% to 2% to the growth of 4% to 5%.
