The Smartest Buffett Stocks to Buy for $1,000 Right Now

When looking for new investment ideas, don’t forget to take a look at Warren Buffett’s portfolio. Buffett’s investment strategy has beaten the market for decades at a time. And by starting with his favorite stocks, you can give your portfolio the jump start it needs.

Right now, two Buffett stocks in particular stand out as incredible values.

Take a risk with this proven stock

Buffett first bought shares of Visa (V 0.39%) in 2011 for about $40 per share. Today, the company is worth more than $250 per share. But Buffett isn’t selling, even after a recent antitrust lawsuit was filed last month by U.S. regulators.

As you may already know, Visa operates one of the largest payment processing networks in the world. In this industry, scale matters. From the point of purchase to the financial institution supporting the payment, payment networks must be vast to connect literally billions of nodes that must work together seamlessly, instantaneously, with minimal error.

As of last quarter, Visa had more than 4 billion active credit and debit cards under its banner, which helped process more than $3 trillion in payment volume over the past 12 months. According to data compiled by Statista, Visa controls more of the market than the next three competitors combined.

In short, Visa operates in an industry that demands scale. And while lawsuits over the decades have tried to derail the company’s dominance, its huge market share is at least partly due to natural industry dynamics, not malice. After a recent correction due to lawsuit fears, the stock is now trading at just 25 times forward earnings. That’s about as cheap as it gets for a highly profitable company with ubiquitous brand awareness and a strong economic moat — not to mention Buffett’s direct backing.

There is short-term risk here, but this looks like a great entry point for patient shareholders who want to look beyond short-term volatility.

V PE ratio data by YCharts

Go for growth with this fintech superstar

Investors looking for maximum growth potential should pay attention to fintech stocks. These businesses combine the rapid growth rates of technology companies with the huge addressable markets of financial companies. As a result, fintech stocks can rise much faster and much higher than most anticipate.

One of my favorite fintech stocks today is Not Holdings (NOT 0.99%). Buffett bought shares of Nu in 2021, and his position is currently valued at about $1.4 billion.

Haven’t you heard of No? This is not a surprise. The company only operates in a handful of countries in Latin America. It started in Brazil about a decade ago, but has since expanded to Mexico and Colombia. It has achieved massive success using a simple strategy: offer financial services not through a physical bank branch, but directly to consumers through their smartphones.

When the company launched in 2013, it was a new idea that took the market by storm. Today, more than half of Brazilian adults are Nu customers, demonstrating how well the company can tap into new markets and grow with exceptional speed. The best news is that there are over 600 million Latin Americans, so Nu’s growth trajectory should continue for years, if not decades, to come.

NU revenue data (quarterly year-on-year growth) by YCharts

With a market cap of $60 billion, Nu’s biggest days of growth may be behind it. But amazingly, revenue growth rates are still averaging over 50% year over year. And the company is already profitable, with shares trading at just 31 times forward earnings. Buffett was an early investor in this fintech stock with impressive long-term growth potential. But at this assessment, it’s not too late to jump in.