10 Best Stocks to Buy According to Warren Buffett

Published June 8, 2021 at 11:46 am EDT Updated August 19, 2026 at 5:01 am EDT

In this article we discuss the 10 best stocks to buy according to Warren Buffett based on the billionaire’s Q1 portfolio.

Warren Buffett is an American business tycoon, philanthropist, and one of the greatest investors of all time. As of June 2021, he has a net worth of over $109 billion. Buffett runs Berkshire Hathaway, which owns more than 60 companies. He believes in the value-based investing model and only invests in the stocks that exhibit solid fundaments, strong earnings power, and the potential for continued growth.

As of Q1 2021, Buffett’s stock portfolio is composed of 48 stocks and its value increased marginally from $270 billion to $270.4 billion.

Apple Inc (NASDAQ: AAPL) remains the biggest stake of Buffett, accounting for 40% of Berkshire’s entire Q1 portfolio. The fund owns 887.14 million shares of the company, worth $108.4 billion. This huge stake reflects the confidence Berkshire has in Apple Inc whose stock is up over 400% in the last 5 years.

Last year, Buffett sold huge stakes in bank stocks, including JPMorgan Chase & Co., The PNC Financial Services Group, Inc. (NYSE: PNC) and Wells Fargo & Company (NYSE: WFC) amid financial volatility caused by the coronavirus crisis. This move was the result of, in the words of a finance professor David Kass at the University of Maryland’s Robert H. Smith School of Business, “extreme caution” practiced by Buffett as bank stocks are prone to losses and vulnerability during difficult times such as the one heralded by the pandemic.

However, in the first quarter of 2021, Berkshire Hathaway has kept its position in Bank of America Corporation (NYSE: BAC), The Bank of New York Mellon Corporation (NYSE: BK), and U.S. Bancorp (NYSE: USB). Berkshire made no change to its stake in Bank of America Corporation (NYSE: BAC) in the first quarter, ending the period with over 1 billion shares of the company, which have a total worth of $39.1 billion.

Buffett is an exception in an industry that is reeling from losses. The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.

best stocks according to Warren Buffett

Let’s now review the 10 best stocks to buy according to Warren Buffett. For this analysis, we examine Berkshire’s latest 13F portfolio. The top 10 holdings represent 87% of the stock portfolio.

Best Stocks to Buy According to Warren Buffett

10. General Motors Company (NYSE: GM)

Buffet’s Stake Value: $3,849,820,000
Percent of Warren Buffett’s 13F Portfolio: 1.42%
Number of Hedge Fund Holders: 86

General Motors Company (NYSE: GM) is the tenth-largest holding of Berkshire Hathaway. As of Q1 2021, it owns nearly 67 million shares of the company, worth $3.84 billion. In the first quarter, Berkshire sliced its stake in the company by 8%. General Motors Company is moving to end production of all diesel vehicles by 2035 and increase its budget by $7 billion on electric car development.

The Q1 2021 results of the company reported earnings of $3 billion, a huge gain as compared to the same quarter last year.

A recently founded investment management firm, Junto Investments, published its Q4 2020 Investor Letter. Here is what the firm has to say about General Motors Company:

“General Motors was the biggest gainer. We managed to buy it at a screamingly cheap price in the middle of March. A lot of interesting news has emerged about GM recently, including the new electric product delivery system BrightDrop and GM Cruise’s team-up with Microsoft Azure to commercialize self-driving cars in 2021. GM’s intrinsic value is crystallizing and the company is worth a whole lot more than is still reflected in the market.”

9. DaVita Inc. (NYSE: DVA)

Buffet’s Stake Value: $3,890,020,000
Percent of Warren Buffett’s 13F Portfolio: 1.43%
Number of Hedge Fund Holders: 34

DaVita Inc. (NYSE: DVA) is a healthcare company focused on transforming care delivery to improve the quality of life. The company is the largest provider of kidney care in the U.S. Berkshire Hathaway owns about 36 million shares of the company, worth $3.8 billion in Q1 2021. DaVita Inc. holds 37% of the healthcare market in the U.S., making it one of the best stocks to buy according to Warren Buffett.

The Q1 2021 reports state revenue of over $2.8 billion and earnings per share of $2.09, 14% above the expectations. The stock has gained 36% over the last 12 months. The company expects revenues to reach $11.5 billion in 2021 and per-share earnings are expected to grow by 20%. Like Apple Inc, Verizon Communications Inc. (NYSE: VZ), The Kraft Heinz Company (NASDAQ: KHC), Bank of America Corporation and The Bank of New York Mellon Corporation, DaVita Inc. is one of the best stocks to buy according to Warren Buffett.

8. U. S. Bancorp (NYSE: USB)

Buffet’s Stake Value: $7,172,993,000
Percent of Warren Buffett’s 13F Portfolio: 2.65%
Number of Hedge Fund Holders: 43

U.S. Bancorp is an American bank holding company and provides various financial services in the U.S. It is one of the best stocks to buy according to Warren Buffett, as Berkshire Hathaway has a $7.1 billion stake in the company. The USB stock was hard hit by the pandemic and saw a low of $29 in March 2020. The stock is up 30% year to date.

In Q1 2021, the financial services company reported net revenue of $5.5 billion, 5% less than the year-ago period, and a net income of $2.3 billion.

Mairs & Power published its fourth-quarter 2020 ‘Growth Fund’ investor letter. The firm mentioned U.S. Bancorp and emphasized their views on the company. Here is what it has to say:

“On the negative side, one of the Fund’s biggest detractors in 2020 was U.S. Bancorp (USB). Like all banks, U.S. Bank was hurt by the difficult interest rate environment and credit cycle concerns. We believe banks are strong enough to survive the current sector doldrums, and they remain some of the market’s most attractive opportunities.”

Like Apple Inc, Verizon Communications Inc., The Kraft Heinz Company, Bank of America Corporation and The Bank of New York Mellon Corporation, U.S. Bancorp is one of the best stocks to buy according to Warren Buffett.

7. Moody’s Corporation (NYSE: MCO)

Buffet’s Stake Value: $7,366,643,000
Percent of Warren Buffett’s 13F Portfolio: 2.72%
Number of Hedge Fund Holders: 55

Moody’s Corporation (NYSE: MCO) is an American business and financial services company. Berkshire Hathaway owns over 25 million shares in the company, worth $7.3 billion. The company’s Q1 2021 reports showed a revenue of $1.6 billion, up 24% from the prior year period. The adjusted EPS also grew to $4.06, compared with $2.73 the prior year. Berkshire Hathaway is Moody’s Corporation’s largest shareholder, with 13% of its shares.

Moody’s Corporation suffered in the initial months of 2020 due to the pandemic, touching the low of $165 in March 2020. However, it has now seen performance improvement and currently, the share price stands at $335. Like Apple Inc, Verizon Communications Inc., The Kraft Heinz Company, Bank of America Corporation, The Bank of New York Mellon Corporation and U.S. Bancorp, Moody’s Corporation is one of the best stocks to buy according to Warren Buffett.

Baron Funds, an investment management firm, published its Q4 2020 ‘Baron FinTech Fund’ investor letter and mentioned Moody’s Corporation. Here is what the firm has to say:

“Moody’s Corporation provides credit ratings, financial intelligence, and analytical tools to assist businesses in making decisions. Moody’s reported excellent financial results due to continued growth in rated debt issuance. However, the stock detracted on investor expectations that issuance trends will moderate into 2021. The announced retirement of long-time CEO Ray McDaniel may have also weighed on sentiment. We continue to own the stock due to our views of the company’s long runway for growth and strong competitive advantages.”

6. Verizon Communications Inc. (NYSE: VZ)

Buffet’s Stake Value: $9,235,649,000
Percent of Warren Buffett’s 13F Portfolio: 3.41%
Number of Hedge Fund Holders: 69

Verizon Communications Inc. is an American multinational telecommunications company, with services and solutions in voice, data, and video on its award-winning network and platforms. As of Q1 2021, Berkshire Hathaway owns over 159 million shares of the company, worth $9.2 billion. Warren Buffett has increased his stake in the company by 9% in the first quarter.

Verizon Communications Inc. reported first-quarter 2021 results in April with a 4.1% increase in total revenue, compared with the same period last year.

5. The Kraft Heinz Company (NASDAQ: KHC)

Buffet’s Stake Value: $13,025,393,000
Percent of Warren Buffett’s 13F Portfolio: 4.81%
Number of Hedge Fund Holders: 33

The Kraft Heinz Company is fifth on our list of the best stocks to buy according to Warren Buffett. Berkshire Hathaway owns over 325 million shares of the company, worth $13 billion. The Kraft Heinz Company is the third-largest food and beverage company in North America.

Warren Buffett’s Berkshire Hathaway published its Q4 2020 Investor Letter. Here is what the investment management firm has to say about The Kraft Heinz Company.

“We exclude our Kraft Heinz holding — 325,442,152 shares — (In the list of 15 common stock investments that at yearend were our largest in market value) because Berkshire is part of a control group and therefore must account for that investment using the “equity” method. On its balance sheet, Berkshire carries the Kraft Heinz holding at a GAAP figure of $13.3 billion, an amount that represents Berkshire’s share of the audited net worth of Kraft Heinz on December 31, 2020.

Berkshire and its subsidiaries hold investments in certain businesses that are accounted for pursuant to the equity method. Currently, the most significant of these is our investment in the common stock of The Kraft Heinz Company (“Kraft Heinz”). Kraft Heinz is one of the world’s largest manufacturers and marketers of food and beverage products, including condiments and sauces, cheese and dairy, meals, meats, refreshment beverages, coffee and other grocery products. Berkshire currently owns 325,442,152 shares of Kraft Heinz common stock representing 26.6% of the outstanding shares.

We recorded equity method earnings from our investment in Kraft Heinz of $95 million in 2020, $493 million in 2019 and losses of approximately $2.7 billion in 2018. Equity method earnings (losses) included the effects of goodwill and identifiable intangible asset impairment charges recorded by Kraft Heinz. Our share of such charges was approximately $850 million in 2020, $450 million in 2019 and $3.7 billion in 2018. We received dividends from Kraft Heinz of $521 million in each of 2020 and 2019 and $814 million in 2018, which we recorded as reductions in our carrying value.

Shares of Kraft Heinz common stock are publicly-traded and the fair value of our investment was approximately $11.3 billion at December 31, 2020 and $10.5 billion at December 31, 2019. The carrying value of our investment was approximately $13.3 billion at December 31, 2020 and $13.8 billion at December 31, 2019. As of December 31, 2020, the carrying value of our investment exceeded the fair value based on the quoted market price by $2.0 billion (15% of carrying value). In light of this fact, we evaluated our investment in Kraft Heinz for impairment. We utilize no bright-line tests in such evaluations. Based on the available facts and information regarding the operating results of Kraft Heinz, our ability and intent to hold the investment until recovery, the relative amount of the decline and the length of time that fair value was less than carrying value, we concluded that recognition of an impairment loss in earnings was not required. However, we will continue to monitor this investment and it is possible that an impairment loss will be recorded in earnings in a future period based on changes in facts and circumstances or intentions.”

4. The Coca-Cola Company (NYSE: KO)

Buffet’s Stake Value: $21,083,999,000
Percent of Warren Buffett’s 13F Portfolio: 7.79%
Number of Hedge Fund Holders: 61

The Coca-Cola Company (NYSE: KO) is an American multinational beverage company with an interest in manufacturing, retailing, and marketing non-alcoholic beverages. It is one of the best stocks to buy according to Warren Buffett, as Berkshire Hathaway has over 400 million shares in the company, worth $21.08 billion. The Q1 2021 reports of the company show the 5% growth in net income to $9.0 billion, compared with $8.6 billion in Q4 2020.

3. American Express Company (NYSE: AXP)

Buffet’s Stake Value: $21,443,817,000
Percent of Warren Buffett’s 13F Portfolio: 7.92%
Number of Hedge Fund Holders: 53

American Express Company (NYSE: AXP) is a financial services corporation with over 114 million cardholders and customers in around 40 countries. Warren Buffett’s Berkshire Hathaway has over 151.6 million shares in the company, worth $21.4 billion, as of Q1 2021. Berkshire has owned American Express stock for more than 25 years, making it one of the best stocks to buy according to Warren Buffett.

American Express Company has a long history of paying dividends, with a 9.1 % per year growth in its distribution since 2011. The company will pay a quarterly dividend of $0.43 per share on 10^th August 2021.

Bretton Fund, in its Q4 2020 Investor Letter, has highlighted a few stocks, including American Express Company. Here is what the fund said.

“American Express has elements of both a bank (it extends credit card loans) and a payments processor (most of its revenue is fees from cardholders and merchants) and was hit pretty hard by Covid-19, though we expect most of the impact will be transitory. It has a relatively diversified customer base overall, but a meaningful portion of its card activity is from business travel, which…there wasn’t a lot of last year. Similar to the banks, American Express recognized loan losses in anticipation of large defaults, though it’s not clear all of that will come to pass. Its stock returned -1.1%, while earnings per share were down 53%.”

2. Bank of America Corporation (NYSE: BAC)

Buffet’s Stake Value: $39,080,793,000
Percent of Warren Buffett’s 13F Portfolio: 14.45%
Number of Hedge Fund Holders: 97

Bank of America Corporation is an American multinational investment bank and financial services holding company. It is one of the world’s leading financial institutions, offering services in banking, investing, asset management, and other financial management products. It is one of the best stocks to buy according to Warren Buffett, as Berkshire Hathaway has over 1 billion shares in the company, worth $30.61 billion. Bank of America Corporation’s stock price has soared by over 40% this year.

ClearBridge Investments has published its ‘Sustainability Leaders Strategy’ Q1 2021 investor letter. Here is what ClearBridge Investments has to say about Bank of America Corporation in its first-quarter 2021 investor letter.

“Higher long-term interest rates supported financials such as Bank of America, which has shown both defensive and offensive characteristics in the past year. We believe it continues to be the least risky large bank from a credit standpoint, with conservative underwriting and controlled risk taking, a leading consumer deposit franchise, scale and technology. It is also a leader in its commitments to sustainability, or as it terms it, responsible growth. Disclosure and reporting at all levels form a large part of this commitment, including gender diversity and equality, environmental commitments and support of communities in which it operates. In the first quarter Bank of America announced it is setting a goal of net-zero greenhouse gas (GHG) emissions in its supply chain and operations, and notably also in its financing activities, before 2050.”

1. Apple Inc. (NASDAQ: AAPL)

Buffet’s Stake Value: $108,363,609,000
Percent of Warren Buffett’s 13F Portfolio: 40.07%
Number of Hedge Fund Holders: 127

Apple Inc. tops our list of the best stocks to buy according to Warren Buffett. This global technology company mainly designs, manufactures, and sells digital gadgets. Berkshire Hathaway has nearly 890 million shares of Apple stock, worth $108.3 billion, as of Q1 2021. Over the last decade, Apple Inc. has been a great investment, with shares returning 900% and revenues increasing by 154% during that time. The reports from Q2 show that the annual revenue of the company grew by 54% at $86.9 billion, with $1.40 earnings per share. The board also announced a $0.22 dividend per share for the quarter.

Distillate Capital, an investment management firm, published its first-quarter 2021 investor letter. Here is what it has to say about Apple Inc..

“Apple is an even more notable situation and one that highlights our free cash valuation methodology and bears further discussion given its Q3 ‘20 sale from our strategy. For an extended period, Apple was extraordinarily inexpensive on a free cash flow basis and was the largest position in our strategy, exceeding 5% of the portfolio.”

Yo can also take a peek at 10 Best Stocks to Buy According to David Einhorn’s Greenlight Capital and 10 Best Cryptocurrencies to Invest in According to Hedge Fund Billionaires.