2 Warren Buffett Stocks That Are Loud Buys Right Now

Warren Buffett owns over 40 stocks through his holding company Berkshire Hathawayand some of them have been part of his portfolio for several years, even decades. Long-term investing is one of the biggest factors behind Buffett’s astounding success as an investor, which is why he’s among the few you’d want to watch for stocks to put your money into.

Right now, two stocks Buffett owns are screaming buys. While one is nearing 52-week lows, the other is beating everyone else out of the game in an industry with massive potential.

A Buffett stock with multibagger potential

Global electric vehicle (EV) market growth has slowed, and the slowdown has hit nearly every EV manufacturer. The only exception, perhaps, is BYD (OTC: BYDDY).

The Chinese EV giant has posted four consecutive months of record deliveries. Sales of BYD’s new energy vehicles (NEVs), including passenger and commercial vehicles, rose 32 percent year-on-year to 419,426 units in September. NEVs include battery electric vehicles, fuel cell electric vehicles, and plug-in hybrids.

BYD is the biggest NEV player in China, holding a 37 percent market share in August, according to industry data. In comparison, adze it had a market share of just 6% in August, despite being a prominent electric vehicle player in China. These numbers should give you an idea of ​​BYD’s size, scale of business and unbeatable foothold in the world’s largest electric passenger vehicle market.

However, there is much more to BYD. It also makes buses and is more than just an electric vehicle maker — it’s also the world’s second largest producer of electric vehicle batteries, just behind Chinese battery maker CATL. This vertical integration is one of the biggest reasons behind BYD’s success, as it has helped the company avoid one of the biggest hurdles for electric vehicle manufacturers – battery costs.

BYD also has extensive operations outside of China, including North America, Europe and Asia, and is expanding aggressively. Thailand is a key market and 1 in 3 electric vehicles sold in the country is a BYD.

Buffett first bought shares in BYD in 2008, with Charlie Munger, the late vice chairman of Berkshire Hathaway, playing a key role in the decision to invest in the electric vehicle stock. Berkshire Hathaway still held a 4.9 percent stake in the electric vehicle maker as of July 16.

Buffett may have cut his BYD position significantly over the past two years, but the electric vehicle stock has generated massive returns. EV is a high-potential industry and BYD a potential multibagger – why you’d want to buy and own this Buffett stock.

Rare Opportunity: A Buffett Stock Near 52-Week Lows

When crude oil prices fall, shares of oil exploration and production companies bear the brunt of the impact, as their earnings are highly sensitive to commodity prices. That goes a long way to explaining why Occidental Petroleum (NYSE: OXY) The stock has fallen this year and hit 52-week lows in the last week of September. Occidental, however, remains one of Buffett’s favorite energy stocks, and I think it’s now a screaming buy, thanks to his latest purchase.

The story continues

Occidental Petroleum acquired CrownRock in August in a cash and stock deal worth about $12 billion. The acquisition extensively expanded Occidental’s footprint in the Permian and Midland basins and will be immediately favorable to its free cash flow. Additionally, Occidental plans to divest $4 billion to $6.5 billion in assets within 18 months of closing the acquisition and use the additional cash flow plus proceeds from asset sales to reduce debt.

High debt has been one of Occidental’s biggest challenges since it acquired Anadarko Petroleum in 2019, so any move to strengthen the balance sheet should work in favor of investors. Read that as higher dividends. Occidental prioritizes dividends and has already increased its dividend per share by 22% earlier this year in anticipation of higher cash flow from CrownRock.

Meanwhile, Occidental also has a large chemicals business called OxyChem and is investing heavily in carbon capture and storage technology, a potential multi-trillion dollar market.

Buffett has been a consistent buyer of Occidental stock. In fact, Berkshire Hathaway now owns a significant stake in Occidental stock. On June 30, it was 28.8%.

The oil stock is also the sixth-largest holding in Berkshire Hathaway’s portfolio. There’s no better time than now to buy this Buffett stock while it’s near its 52-week lows.

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Neha Chamaria has no position in any of the shares mentioned. The Motley Fool has positions in and recommends BYD Company, Berkshire Hathaway and Tesla. The Motley Fool recommends Occidental Petroleum. The Motley Fool has a disclosure policy.

2 Warren Buffett Stocks That Are Loud Buys Right Now was originally published by The Motley Fool