We recently published a list of 12 Best Warren Buffett Stock Picks For Beginners. In this article, we are going to take a look at where Amazon.com, Inc. (NASDAQ:AMZN) stands against other best Warren Buffett stocks to invest in.
Warren Buffett, one of the most renowned names in the world of finance, was inspired by two famous economists from the 1930s, Ben Graham and Philip Fisher. From Graham, Buffett learned the idea of a margin of safety, which means he seeks companies whose stocks are trading for less than what their assets are actually worth. He also picked up Graham’s belief that it is pointless to obsess over daily market ups and downs, since real success comes from holding investments for the long term. From Fisher, Buffett developed a strong focus on the quality of a company’s management. He realized that great leadership can make a significant difference in a business’s long-term value. Fisher also warned that over-diversifying could backfire, making it harder to properly monitor each investment. Buffett clearly follows this thinking, since his $267 billion portfolio is concentrated in just 38 stocks as of Q4 2024.
Warren Buffett’s investment strategy is a masterclass in disciplined and fundamentals-driven investing. His focus is on companies with durable competitive advantages, which he refers to as economic moats, combined with strong management and solid capital allocation. The Oracle of Omaha is against chasing trends. Instead, he looks for long-term value and buys only when a company is trading below its intrinsic worth. Buffett’s approach with the iPhone-maker is a great case in point. He was not just impressed by the hardware; he saw the value in its services ecosystem, like the App Store and iCloud, which generate consistent, high-margin revenue.
During the height of the 2008 financial crisis, the Berkshire billionaire shared a remark with investors that remains just as relevant in the current stock market landscape. He wrote:
“Over the long term, the stock market news will be good. In the 20th century, the United States endured two world wars and other traumatic and expensive military conflicts; the Depression; a dozen or so recessions and financial panics; oil shocks; a flu epidemic; and the resignation of a disgraced president. Yet the Dow rose from 66 to 11,497.”
Buffett also emphasizes simplicity and efficiency. Despite his success as a stock picker, he recommends low-cost S&P index funds for most investors, believing they outperform most professionals over time. At its core, Buffett’s strategy is not flashy, and he offers a blueprint for sustainable wealth creation. This article presents the Warren Buffett stock picks that are especially suitable for new investors looking to build a strong portfolio.
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Our Methodology
For this article, we explored Warren Buffett’s Q4 2024 portfolio, picking 12 stocks with the highest hedge fund sentiment. These stocks are backed by Wall Street hedge funds and the Oracle of Omaha himself. The stocks are ranked in ascending order based on the number of hedge fund holders as per Insider Monkey’s Q4 2024. We also included the value of Berkshire Hathaway’s stake in each company for further context.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 339
Berkshire Hathaway’s Stake Value: $2,193,900,000
Warren Buffett picked up Amazon.com, Inc. (NASDAQ:AMZN) shares in the first quarter of 2019, and as of Q4 2024, Berkshire holds 10 million units of the stock. On April 24, a team of analysts at Citi, led by Ronald Josey, maintained a Buy rating on Amazon with a price target of $225. Ahead of Q1 2025 earnings on May 1, analysts expect results to meet or slightly exceed expectations. However, the bigger focus is on how the company will perform later in the year, especially with challenges like tariffs, China exposure, and demand for AWS.
On April 24, AWS and Nasdaq announced a collaboration to launch new tools that help modernize markets around the world. Their goal is to facilitate market operators in boosting liquidity, managing capital, and growth while maintaining tight security and performance. This partnership aims to strengthen financial systems, make global investing smoother, and support long-term economic growth.
Similarly, London Stock Exchange Group (LSEG) announced an extension of its partnership with Amazon Web Services on April 28, making AWS the preferred cloud provider for its Markets, Risk Intelligence, and FTSE Russell divisions. The move will help LSEG improve security, resilience, and speed up the launch of new services. By using tools like Amazon Bedrock, LSEG plans to deliver faster, more accurate risk analysis, while AWS Outposts will help power scalable market services.
According to Insider Monkey’s fourth quarter database, 339 hedge funds were bullish on Amazon.com, Inc. (NASDAQ:AMZN), compared to 286 funds in the preceding quarter. Boykin Curry’s Eagle Capital Management was the biggest stakeholder of the company, with 12.76 million shares valued at $2.80 billion.
Overall, AMZN ranks 1st among the best Warren Buffett stock picks for beginners. While we acknowledge the potential of AMZN as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than AMZN but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
