2 no-hassle Warren Buffett stocks to buy right now

The “Oracle of Omaha” didn’t get that nickname by accident. In his 60-year career at Berkshire HathawayWarren Buffett had a knack for seeing into the future. At least, it might seem that way, but Buffett doesn’t have a crystal ball. Instead, he has a clear strategy and philosophy that guides every investment decision he makes. It made him a billionaire and made many people who adopted his approach a lot of money over the years.

Buffett believes in disciplined investing and that timing the market beats timing the market. Instead of scouring the market for a great stock deal, pay more attention to the deals themselves and then: “When you find a really great deal, stick with it. Patience pays…”

One factor that makes a business “great” is a fundamental competitive advantage that protects a business from competitors: a moat. As Buffett explained in his 2007 letter to shareholders: “The dynamics of capitalism guarantee that competitors will repeatedly attack any business ‘castle’ that earns high profits. Therefore, a formidable barrier … is essential for sustained success”.

Here are two companies that Buffett loves and have significant moats.

1. There’s a reason Buffett stuck around Coca-Cola for so long

If you want to talk about ditches, you’d be hard-pressed to find a bigger one that’s been maintained for more than Coca cola (K.O 1.00%). The drinks giant is one of the most recognizable brands in the world. It’s so ingrained in our culture that large areas of the South use it as a generic term for soda.

That brand protects it from upstarts vying for shelf space. It means that any company trying to get off the ground has to spend ungodly amounts to even begin to match the kind of recognition it has.

Not only the brand is valuable, but also the company. Coca Cola has grown steadily over the years and continues to gain ground. It is a stable, proven business that constantly finds ways to adapt to consumer demands. I must note that Coca Cola is priced lightly at the moment compared to the competition. Its forward price-to-earnings (P/E) ratio is around 24. That’s above PepsiCo’s and Keurig Dr. Pepper’s 20 and 18. It’s a little higher, but not terrible. I still think it fits perfectly in a diverse portfolio as an anchor of stability. Don’t expect tech-like returns; expect consistency and a healthy dividend yield that grows year on year.

2. Amazon is an amazing company, and Buffett knows it, even if he missed its meteoric rise

Amazon (AMZN 2.34%) it has many of the qualities Buffett likes, but it’s also a technology company. Buffett likes to say that he doesn’t invest in what he can’t understand, and a lot of technology falls into that category. Now this is often taken to mean that he doesn’t understand technology itself, and I certainly doubt that Buffett understands the intricacies of computer science, but what he’s really saying is that he doesn’t understand business. He cannot intuitively understand what the business will look like in, say, 20 years.

In a way, he says, he can’t accurately assess the moats of most tech companies. It makes sense — technology is advancing by leaps and bounds, and a company that seems to have a firm grip on a market can be replaced by a market, or frankly, the entire market can quickly become obsolete.

Buffett made exceptions – Berkshire’s largest holding is Apple after all — but that attitude has driven many of the company’s decisions for years and prevented him from making the jump to Amazon despite being a fan of the company. In fact, it wasn’t even Buffett who made the initial purchase in 2019, it was another Berkshire manager. He is grateful that Berkshire owns stock now, saying at an annual shareholder meeting that he “got away” by not investing early.

Amazon is not your average tech company. There is an incredible amount of physical infrastructure, real-world resources, and complex logistics that make direct competition with it expensive and nearly impossible. Beyond this, the company has built a brand that people indeed trust. In fact, it is the most trusted institution in the country. According to a 2023 survey by The Harris Poll and HarrisX, Americans trust Amazon more than the US military or the Supreme Court. How many brands can say that?

Even though Berkshire only entered 2019, the stock has nearly doubled in that time, and the future doesn’t look any different. It is pushing the boundaries of artificial intelligence (AI), rapidly expanding its adtech business, and continuing to gain ground in e-commerce, where it already absolutely dominates. I think Amazon is another no brainer purchase.