In this article, we’re going to take a look at Warren Buffett‘s 5 stock picks with huge upside potential. For a more information on Warren Buffett and his holding company Berkshire Hathaway and more stock picks, navigate to Warren Buffett’s 10 stock picks with huge upside potential.
5. Liberty Media
Liberty Media is a US mass media company, which has several tracking stocks based on its investments. Warren Buffett’s Berkshire Hathaway holds shares in several of these tracking stocks, but for this article, we would like to highlight five holdings. In Liberty Media Corp Series C (NASDAQ:LSXMK) and Liberty Media Corp Series A (NASDAQ:LSXMA), Berkshire owns 43.20 million shares and 20.21 million shares, worth $1.10 billion and $514.29 million, respectively. Both Liberty Media Corp Series C (NASDAQ:LSXMK) and Liberty Media Corp Series A (NASDAQ:LSXMA) are tracking stocks representing Liberty Media investment in Sirius XM Holdings Inc (NASDAQ:SIRI) (around 84% of the company). Both Liberty Media Corp Series C (NASDAQ:LSXMK) and Liberty Media Corp Series A (NASDAQ:LSXMA) have upside potential of 31.70% and 46.20%, respectively. Additionally, Buffett’s fund owns 7.72 million shares of Liberty Media Corp Series C (NASDAQ:FWONK) worth $481.11 million. Liberty Media Corp Series C (NASDAQ:FWONK) represents Liberty Media’s investment in Formula One Group, in which Liberty acquired controlling interest in 2017. Currently, Liberty Media Corp Series C (NASDAQ:FWONK)’s shares carry an upside potential of around 34%.
At the end of September, 48 hedge funds in our database held shares of each Liberty Media Corp Series C (NASDAQ:LSXMK) and Liberty Media Corp Series A (NASDAQ:LSXMA) and 49 investors were bullish on Liberty Media Corp Series C (NASDAQ:FWONK).
4. Kroger Co (NYSE:KR)
Berkshire Hathaway Holding: $2.24 billion
Upside Potential: 17%
In Kroger Co (NYSE:KR), Buffett’s fund has amassed 50 million shares, according to Berkshire’s latest 13F filing. The supermarket operator has recently reported its earnings for the fiscal third quarter, which included revenue of $33.96 billion and EPS of $0.95, both slightly above estimates. Kroger Co (NYSE:KR) also cut its full-year identical sales estimates to between 0.6% and 1% from the previous guidance between 1% and 2%. During the earnings call, CEO Rodney McMullen and CFO Gary Millerchip highlighted digital sales as a tailwind for Kroger Co (NYSE:KR).
“However, unit growth rates have lagged the rate of inflation decline and have not improved at the pace we would have expected,” Millerchip added.
Overall, Kroger Co (NYSE:KR) saw a slight decrease in popularity among hedge funds, with 41 investors holding $3.05 billion worth of stock at the end of September, versus 43 funds and $3.14 billion a quarter earlier.
3. Occidental Petroleum Corp (NYSE:OXY)
Berkshire Hathaway Holding: $14.43 billion
Upside Potential: 22.2%
At the end of September, Berkshire Hathaway held 228.05 million shares of Occidental Petroleum Corp (NYSE:OXY), unchanged over the quarter, and is currently the top shareholder of the oil company. Including Buffett, there are 75 investors in our database bullish on the company, based on the latest round of 13F filings, an increase of two funds over the quarter. According to reports, Occidental Petroleum Corp (NYSE:OXY) is one of the final bidders to acquire CrownRock, a Texas energy producer. In 2019, Warren Buffett helped Occidental Petroleum Corp (NYSE:OXY) to fund the acquisition of Anadarko Petroleum in exchange for preferred stock and rumor has it that the billionaire investor might be involved in the latest deal as well.
2. Chevron Corporation (NYSE:CVX)
Berkshire Hathaway Holding: $18.50 billion
Upside Potential: 30%
Chevron Corporation (NYSE:CVX) is another energy company in Warren Buffett’s portfolio that has a huge upside potential. During the third quarter, Berkshire Hathaway cut its stake in Chevron by 10.5% to 110.25 million shares. At the end of October, Chevron Corporation (NYSE:CVX)’s stock took a nosedive amid the company announcing an agreement to buy Hess Corp. (NYSE:HES) in an all-stock deal worth $53 billion. Moreover, for the third quarter, Chevron Corporation (NYSE:CVX) reported EPS of $3.05, missing the estimates by $0.63, although its revenue of $54.08 billion came in $1.08 billion higher than expected. Among the funds tracked by Insider Monkey, 72 investors held a total of $1.78 billion worth of Chevron Corporation (NYSE:CVX) stock.
1. Bank of America Corp (NYSE:BAC)
Berkshire Hathaway Holding: $28.28 billion
Upside Potential: 15%
With a $28.28 billion position containing 1.03 billion shares, Bank of America Corp (NYSE:BAC) is Buffett’s second-largest holding as of the end of September. Year-to-date, Bank of America Corp (NYSE:BAC)’s stock is down by 9%, falling amid concerns over the US economy and the banking sector in particular, the latter being caused by the failure of three regional banks earlier this year. Earlier this month, Goldman Sachs reiterated its ‘Buy’ rating on Bank of America Corp (NYSE:BAC)’s stock and raised its price target by $3 to $33. During the third quarter, the number of investors from our database bullish on Bank of America Corp (NYSE:BAC) inched up by two to 80.
