15 Smallest Stocks In Warren Buffett’s Portfolio

Published on August 18, 2023 at 2:34 pm by Ramish Cheema in Hedge Funds, News

In this piece, we will take a look at the 15 smallest stocks in Warren Buffett’s portfolio. If you want to skip our introduction to perhaps the best known investor of our time, then head on over to 5 Smallest Stocks In Warren Buffett’s Portfolio.

Warren Buffett is the most successful hedge fund investor of our time. While his firm Berkshire Hathaway Inc. (NYSE:BRK-A) is not structured as a hedge fund, meaning that it does not use leverage to make risky investments for massive profits, Mr. Buffett’s investment portfolio filed every quarter with the SEC still generates hype like the filings of major hedge funds do. After all, even though their investment strategies might be different, both Berkshire Hathaway and hedge funds rely on share price appreciations to grow their investments in value. However, unlike hedge funds, which often use a variety of trading strategies such as long, short, buying distressed debt, and small cap investing, Mr. Buffett’s firm simply pays extremely close attention to companies before it invests in them and then holds the shares for years to let the profits accrue.

Its success on the investing front has also made Mr. Buffett the most successful investor of our time. Our research covering the 20 Highest Paid Hedge Fund Managers of All Time shows that the top three fund managers have cumulatively made $176.2 billion in their time spent on the market and out of this, 65% of the compensation belongs to Mr. Buffett. Currently, the well known Oracle of Omaha is worth $118 billion, and is one of the richest people in the world.

Berkshire Hathaway’s investment portfolio is worth $348 billion as of June 2023 based on its SEC filings. This marks a $23 billion growth over the first quarter of 2023, and a more sizeable $55 billion annual growth. Seems like not only have Mr. Buffett’s investments continued to grow on the stock market even as the market is quite turbulent, but he might also be getting more money for investing.

Unlike hedge funds, which post periodic returns and make payouts to investors, Berkshire Hathaway earns its profits from the dividends of the firms that it has invested in. Getting dividends, and reinvesting them, is one of Warren Buffett’s favorite strategies and it fits in with his love of compounding which he discovered in his childhood. His decades spent on the stock market have seen him invest in some of the most popular, successful, and biggest companies in the world. As of Q2 2023, some of these firms in Warren Buffett’s portfolio are The Coca-Cola Company (NYSE:KO), Apple Inc. (NASDAQ:AAPL), and Bank of America Corporation (NASDAQ:BAC). If you want to find out more about Mr. Buffett’s longest held investments, then take a look at Warren Buffett’s 12 Longest Held Stocks.

The second quarter of 2023 hedge fund filing season is a crucial one since it shows what the funds might be thinking as interest rates touch record levels and the economy might be heading towards a recession. One sector that has caused some concern among investors is the real estate sector. This sector is one of the most sensitive to interest rate hikes, and the commercial office real estate sector in particular is quite jittery these days. Yet, it seems like Mr. Buffett might be long on the home building sector. He bought three new stocks during the second quarter, which are NVR, Inc. (NYSE:NVR), Lennar Corporation (NYSE:LEN), and D.R. Horton, Inc. (NYSE:DHI). All these stocks are up in double digit percentages year to date, but it looks like Mr. Buffett believes there might be more steam left in this rally.

With Warren Buffett’s latest investment portfolio out, we decided to take a look at the smallest stocks in his portfolio in terms of market capitalization, with the notable picks being StoneCo Ltd. (NASDAQ:STNE), Louisiana-Pacific Corporation (NYSE:LPX), and Liberty Latin America Ltd. (NASDAQ:LILA).

Our Methodology

To compile our list of Warren Buffett’s smallest stocks, we took a look at his second quarter of 2023 investment portfolio courtesy of SEC filings. Out of these, we picked the 15 stocks with the lowest market capitalization.

Smallest Stocks In Warren Buffett’s Portfolio

15. HP Inc. (NYSE:HPQ)

Warren Buffett’s Latest Investment: $3.7 billion

HP Inc. (NYSE:HPQ) is the personal computing division of HP, one of the oldest consumer technology firms in the world. Its shares are rated Buy on average but are lingering towards Hold.

Mr. Buffett’s investment firm owned a $7.9 billion stake in HP Inc. (NYSE:HPQ) during Q2 2023 making it the largest hedge fund investor. Including Berkshire 46 of the 910 hedge funds part of Insider Monkey’s database had also invested in the firm during the same time period.

HP Inc. (NYSE:HPQ) joins Louisiana-Pacific Corporation (NYSE:LPX), StoneCo Ltd. (NASDAQ:STNE), and Liberty Latin America Ltd. (NASDAQ:LILA) in our list of the smallest stocks in Warren Buffett’s second quarter of 2023 portfolio.

14. VeriSign, Inc. (NASDAQ:VRSN)

Warren Buffett’s Latest Investment: $2.8 billion

VeriSign, Inc. (NASDAQ:VRSN) is an internet company that enables firms to set up websites. Despite the turmoil in the technology sector, the firm has beaten analyst EPS estimates for all four of its latest quarters, and the stock is nearly flat year to date.

After digging through 910 hedge funds for their second quarter of 2023 shareholdings, Insider Monkey discovered that 35 had held a stake in the firm. VeriSign, Inc. (NASDAQ:VRSN)’s largest shareholder is Berkshire Hathaway, through its $2.8 billion investment.

13. Markel Group Inc. (NYSE:MKL)

Warren Buffett’s Latest Investment: $652 million

Markel Group Inc. (NYSE:MKL) has a market capitalization of $19.92 billion, out of which Berkshire Hathaway owns $652 million worth of shares. It belongs to one of Warren Buffett’s favorite investment sectors, insurance.

By the end of June 2023, 29 of the 910 hedge funds polled by Insider Monkey had bought Markel Group Inc. (NYSE:MKL)’s shares. After Berkshire, its largest shareholder is Brian Ashford-Russell and Tim Woolley’s Polar Capital since it owns 101,250 shares that are worth $140 million.

12. NVR, Inc. (NYSE:NVR)

Warren Buffett’s Latest Investment: $70 million

NVR, Inc. (NYSE:NVR) is a fresh addition to Berkshire’s investment portfolio, with the firm having bought 11,112 shares of the firm that are worth $70 million in the second quarter. The firm has a market capitalization of $19.6 billion and its shares are rated Buy on average.

During this year’s second quarter, 41 of the 910 hedge funds part of Insider Monkey’s research had held a stake in the company. NVR, Inc. (NYSE:NVR)’s biggest shareholder in our database is Ric Dillon’s Diamond Hill Capital with a stake worth $615 million.

11. Celanese Corporation (NYSE:CE)

Warren Buffett’s Latest Investment: $620 million

Celanese Corporation (NYSE:CE) is a chemicals company that sells products to a variety of industries such as medicine, food production, and car manufacturing. While Mr. Buffett’s investment firm owned a $620 million stake in the firm during Q2 2023, this was after a 40% reduction.

Along with Berkshire, 30 of the 910 hedge funds part of Insider Monkey’s database had also invested in Celanese Corporation (NYSE:CE) as of Q2 2023 end. Out of these, the second largest investor is Natixis Global Asset Management’s Harris Associates since it owns $207 million worth of shares.

10. Globe Life Inc. (NYSE:GL)

Warren Buffett’s Latest Investment: $275 million

Globe Life Inc. (NYSE:GL) is another insurance company. The firm was set up in 1979 and it primarily provides life and health insurance products. Berkshire Hathaway had invested $275 million in the firm during 2023’s June quarter, and this marked a massive 61% drop.

Globe Life Inc. (NYSE:GL)’s market capitalization is $10.7 billion, and 29 of the 910 hedge funds screened by Insider Monkey had bought its shares as of June 2023.

9. Floor & Decor Holdings, Inc. (NYSE:FND)

Warren Buffett’s Latest Investment: $496 million

Floor & Decor Holdings, Inc. (NYSE:FND), as the name suggests, sells flooring and other household construction and decoration products. It managed to meet analyst EPS estimates for its second quarter, and the shares are rated Buy on average.

During this year’s second quarter, 36 of the 910 hedge funds part of Insider Monkey’s research had held a stake in the company. Out of these, Floor & Decor Holdings, Inc. (NYSE:FND)’s biggest shareholder is Berkshire Hathaway with an investment of $496 million.

8. Paramount Global (NASDAQ:PARA)

Warren Buffett’s Latest Investment: $1.49 billion

Paramount Global (NASDAQ:PARA) is an entertainment company that operates television networks and film studios. It is currently battling a Hollywood strike and has a market capitalization of $9.57 billion.

Mr. Buffett’s investment firm is Paramount Global (NASDAQ:PARA)’s biggest hedge fund shareholder since it owns 93.7 million shares that are worth $1.49 billion. Along with it, 39 of the 910 hedge funds polled by Insider Monkey for their second quarter of 2023 investments had also bought the shares.

7. DaVita Inc. (NYSE:DVA)

Warren Buffett’s Latest Investment: $3.63 billion

DaVita Inc. (NYSE:DVA) is a healthcare company that focuses on meeting the dialysis needs of kidney patients. The firm was in for some good news in August as UBS upgrades its share price rating to Buy from Neutral and increased the share price target by $42 to $142.

During this June quarter, 30 of the 910 hedge funds surveyed by Insider Monkey had held a stake in the company. DaVita Inc. (NYSE:DVA)’s biggest shareholder out of these is Mr. Buffett’s investment firm since it has a $3.63 billion stake, with DaVita Inc. (NYSE:DVA)’s market capitalization being $9.19 billion.

6. Ally Financial Inc. (NYSE:ALLY)

Warren Buffett’s Latest Investment: $783 million

Ally Financial Inc. (NYSE:ALLY) is a financial services firm that provides insurance, car loans, and mortgages. The company beat second quarter 2023 analyst EPS estimates, and its market capitalization is $8.17 billion.

After scouring through 910 hedge funds for their Q2 2023 shareholdings, Insider Monkey discovered that 46 had bought Ally Financial Inc. (NYSE:ALLY)’s shares. While Berkshire Hathaway is the largest shareholder out of these, Natixis Global Asset Management’s Harris Associates also owns a sizeable $703 million investment.

StoneCo Ltd. (NASDAQ:STNE), Ally Financial Inc. (NYSE:ALLY), Louisiana-Pacific Corporation (NYSE:LPX), and Liberty Latin America Ltd. (NASDAQ:LILA) are some of the smallest stocks that Warren Buffett has invested in.

Click to continue reading and see 5 Smallest Stocks In Warren Buffett’s Portfolio.

AI Fire Sale: Insider Monkey’s #1 AI Stock Pick Is On A Steep Discount

Published on May 1, 2024 at by Inan Dogan, PhD

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A New Dawn is Coming to U.S. Stocks

Published on May 2, 2024 at by Insider Monkey Staff

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