7 Value Stocks to Look at After Berkshire Hathaway’s Spotlight

7 Value Stocks to Look at After Berkshire Hathaway’s Spotlight

On Feb. 26, Warren Buffett issued his annual letter to shareholders of Berkshire Hathaway (NYSE: BRK-A , NYSE: BRK-B ), which is up 10.6% year-to-date and at record highs. Wall Street pays close attention when the investing legend makes changes to his portfolio. Therefore, today’s article introduces seven Warren Buffett value stocks.

The “Oracle of Omaha” has an astonishing track record. Buffett’s six-decades of value investing success has created more than $700 billion in shareholder value , with an average annual return of 20%, since taking over as CEO in 1965.

After the recent pullback in the stock market, now could be the perfect time to invest in certain Warren Buffett value stocks. A review of Berkshire Hathaway’s most recent 13F filing reveals several shares that stand out as potential winners in the rest of the year.

Berkshire Hathaway ended the fourth quarter as a net seller of equities, pulling back on bullish bets, particularly in the healthcare and financial sectors. While Warren Buffett highlighted the lack of bargains, he nonetheless bought shares in Activision Blizzard (NASDAQ: ATVI ) and Nu (NYSE: NU ).

With that information, here are seven value stocks that could gain traction in 2022: Apple (NASDAQ: AAPL )

Bank of America (NYSE: BAC )

General Motors (NYSE: GM )

Kraft Heinz (NASDAQ: KHC )

Kroger (NYSE: KR )

Nu (NYSE: NU )

Verizon Communications (NYSE: VZ )

Value Stocks: Apple (AAPL)

Source: pio3 / Shutterstock.com 52-week range: $118.79 – $182.94

Dividend Yield: 0.54%

Tech darling Apple has built an iconic brand focusing on mobile communication and media devices. The company boasts a 22% share of the global smartphone market. Buffett’s team holds a 5.4% stake in Apple, and close to half of the portfolio is held in the tech name.

The consumer technology giant released first-quarter FY22 results on Jan. 27. It reported record revenues of $123.9 billion, up 11% year-over-year (YOY). Net income came in at $34.6 billion, or $2.10 per diluted share, up from $28.8 billion a year ago. Cash and equivalents ended the quarter at $38.6 billion.

In 2021, Apple generated $192 billion in revenue from its iPhone segment, representing a 39% YOY increase. The company has also developed a thriving services business around its hardware that offers even more lucrative margins.

Meanwhile, Q1 revenues for the services segment soared 24% YOY to $19.5 billion . Analysts anticipate a modest 8% top-line growth in the 2022 fiscal year.

Apple just wrapped up its first product event of the year on March 8. It focused on a new more affordable iPhone SE, an update to the iPad Air, and its latest, most powerful Mac chip, the M1 Ultra, which will make its debut in the new Mac Studio computer.AAPL stock currently hovers around $153 territory, up 27% over the past year. Shares are trading at 27.5 times forward earnings and 7.3 times trailing sales. While still not necessarily cheap on a fundamental basis, the stock offers much better value now, after dropping 13% YTD. The 12-month median price forecast for Apple is at $192 . Bank of America (BAC) Source: Tero Vesalainen / Shutterstock.com 52-week range: $36.51 – $50.11Dividend yield: 2.08%Charlotte, North Carolina-based Bank of America is one of the largest financial institutions stateside. Berkshire’s stake in the company accounts for almost 14% of its total portfolio value.Bank of America released Q4 2021 results on Jan. 19. Revenue grew 10% YOY to $22.1 billion. Net income surged 28% YOY to $7 billion, or 82 cents per diluted share, up from $5.5 billion in the prior-year quarter.Like other financial names, Bank of America is highly sensitive to interest rates. Given the anticipated interest rate hikes, the bank is well-positioned for expanding its income from interest on variable-rate loans. Q4 operating results suggest that a 100-basis-point rise in the interest rate yield curve would lead to roughly an increase in net interest income of $6.5 billion.BAC stock hovers at $41 territory, down almost 7% year-to-date (YTD). Nevertheless, shares look reasonably priced at 14 times forward earnings and 4.3 times trailing sales. Meanwhile, the 12-month median price forecast for BAC stock stands at $51 . Value Stocks: General Motors (GM) Source: Katherine Welles / Shutterstock.com 52-week range: $39.75 – $67.21General Motors is a leading American automaker that has also been expanding into electric vehicles (EVs). For instance, last year, GM pledged to invest $35 billion through 2025 in EVs , autonomous vehicles, and battery facilities.Management also anticipates an annual manufacturing capacity growth of more than 1 million EVs. In addition, the automaker secured more than 110,000 […]

source 7 Value Stocks to Look at After Berkshire Hathaway’s Spotlight

Leave a Reply