The Best Warren Buffett Stocks to Buy for $3,000 Right Now

He may be from a different era than you, but Warren Buffett’s investment wisdom is timeless. It may take some time to realize that being patient with his stock picking style eventually pays off.

With that in mind, if you have $3,000 worth of idle cash in your portfolio, here are three stocks you currently own in Berkshire Hathawayhis portfolio that would be great long-term investments for you too.

Apple

It’s a stock pick so commonly suggested that it’s almost become a cliché. However, there is a reason Apple (AAPL 0.51%) is still Berkshire’s largest holding, despite Buffett’s recent sale of nearly half of the fund’s position in the company: its long-term growth prospects remain attractive.

Yes, that attraction has everything to do with the recently unveiled and soon-to-be-shipped iPhone 16, which has enough internal processing power to handle some generative AI tasks natively on the device (as opposed to sending that computer heavy to cloud servers. , where most artificial intelligence processing takes place now). While the iPhone 16 won’t technically be the world’s first AI-capable smartphone, it’s probably the one the world is most excited about. After all, iPhones are the most popular smartphones in the world.

In true Apple fashion, the company also makes it easy for iPhone users to get the most out of this functionality. The Apple Intelligence software needed to turn newer iPhones and iPads into full AI devices will become available next month, offering services such as auto-writing, photo enhancement and a much-improved Siri digital assistant.

Never has the time been more ripe for such a product from such a respected brand. Technology market researcher IDC predicts that the number of AI-capable smartphones will grow from about 230 million this year to more than 900 million in 2028, when they will account for more than two-thirds of the smartphone market. Apple is positioned to capture at least its fair share of this segment.

Of course, in a world with even more iPhone owners who are even bigger users of these devices, Apple’s high-margin services business (apps, music, video) can only be expected to continue and grow.

Chevron

It would be understandable to think of that oil giant Chevron (CVX -1.38%) it doesn’t really have a future. After all, fossil fuels are bad for the environment, and cleaner alternatives like solar are now available and competitively priced.

Still, it’s too early to call Chevron.

Although alternative energy sources are viable, the transition to them for most of the world’s energy needs will not be a multi-year project. It will be a multidecade project, and even as new green power generation is brought online, the overall need for power continues to grow. Standard & Poor’s reports that the world will have used a record amount of fossil fuels in 2023, largely because oil and natural gas are proven and their infrastructure is in place right now. Indeed, the US Energy Information Administration believes that — unless there is a change in current consumption trajectories — oil will remain the planet’s primary energy source until 2050. This coincides with the outlook from Goldman Sachs and OPEC.

While stagnant crude oil prices may have limited Chevron’s stock since early 2022, the company is still making a lot of money, reliably generating annual net income in the $20 billion range. When oil prices are inflated like they were in 2022, the company’s bottom line explodes.

There isn’t a ton of growth in the books for Chevron, to be clear. It’s mostly just a cash-generating operation that supports strong, reliably growing dividends.

However, given the stock’s forward dividend yield of 4.5% and the company’s track record of growing payouts, this is a fair trade-off. As of this year, the company has not only paid its quarterly dividend like clockwork for decades, but has increased its annual payout in each of the past 37 years. This streak is not likely to end anytime soon.

As of its last portfolio report, Berkshire Hathaway owned 118.6 million Chevron shares, which are now collectively worth about $17.4 billion.

Coca cola

Last but not least, add The Coca-Cola Company (K.O -0.07%) to your list of Buffett stocks to buy for $3,000 right now.

We all know Coca-Cola as a beverage brand, but those who are also somewhat familiar with it as an investment are probably aware that the stock’s long march since hitting a more than 20-year low in 2009 , left it at a rich price for 25 years. times this year’s estimated earnings of $2.85 per share and nearly 24 times next year’s estimated earnings of $3.04 per share. It’s not cheap compared to most other consumer goods stocks.

But as Buffett said, his general investment philosophy is that “it’s much better to buy a great company at the right price than a great company at a great price.” Coca-Cola is undoubtedly a wonderful company, even if the current stock price is only fair. Sometimes you just have to pay a premium for quality worth buying and keeping.

This quality is, of course, rooted in the company’s market leadership. Not only is the eponymous cola the most popular carbonated beverage on the planet, but The Coca-Cola Company also owns a number of other well-known brands, including Dasani water, Gold Peak tea, Minute Maid juices and Powerade sports drinks. This wide range of offerings gives it and its manufacturing and distribution partners great leverage when it comes to getting products prominently placed in stores.

Of course, grocery stores and convenience stores are also more than happy to carry and display Coca-Cola products, knowing that the organization is also brilliant and efficient when it comes to marketing, which helps ensure that consumers will continue to buy them.

However, it wasn’t just this lingering dominance of the beverage industry that inspired Buffett’s position of 400 million shares in Coca-Cola. (That makes it Berkshire Hathway’s fourth-largest stock holding, by the way, at $28.6 billion.) Like Chevron, this company does something shareholders appreciate — it generates reliable income which support its dividends and drive persistent payout growth. Coca-Cola has now increased its payout every year for 62 consecutive years.

Those buying the stock now will jump in, while the estimated dividend yield stands at just over 2.7%.