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When it comes to investing, there is no better mentor than Warren Buffett. That’s because the Oracle of Omaha has managed to outperform the stock market with its long-term investment philosophy. So here are three stocks he has invested in that I’m buying with £1,000 left over.
1 apple
Apple (NASDAQ:AAPL) has been a mainstay in Warren Buffett’s portfolio for years. As of the last presentation, the Buffett fund, Berkshire Hathawayowns more than 915 million Apple shares.
Although sometimes accused of being a “boring” stock, Apple remains a leader in the smartphone industry, with an ever-growing user base. This not only increases device sales, but also provides additional revenue when users adopt and purchase the company’s services (Apple Music, iCloud, Apple TV).
Furthermore, Apple’s financials are also impressive. The company generated a whopping $394 billion in sales revenue last year and is steadily increasing its profit margins. His cash pile is also huge, worth $24 billion, giving him room to increase shareholder value through share buybacks and dividends. So it’s easy to see why Warren Buffett is a big fan of the world’s most valuable company.
2.TSMC
Taiwan Semiconductor Manufacturing Company (NYSE:TSM) is the world’s largest semiconductor foundry. He is responsible for producing chips for some of the biggest names in the tech industry. These include the likes of AMD, Qualcommand Apple.
Warren Buffett recently sold almost his entire stake in TSMC, alarming many investors. However, he remains bullish on the manufacturer as it remains the industry leader and creates the most advanced chips in the world.
More importantly, TSMC’s financials are extremely impressive. The group is indeed a money maker, having been able to grow revenue while expanding profit margins without issue. This is due to the increasing demand for semiconductors, as the world becomes increasingly digital with more and more devices requiring chips.
The recent drop in demand may have affected TSMC’s share price. But eventually a bounce will occur and a rally could begin. After all, its current P/E ratio of 13 is ridiculously cheap for a growth stock.
3.Diageo
Warren Buffett only owns a small position in Spirit-Maker Diageo (LSE: DGE). Nonetheless, I think it’s a great move, especially during the current cost of living crisis.
The beverage company has reported strong numbers over the course of 2022, showing its resilience despite high inflation. This is because the company has a strong market position and is well positioned to benefit from the growing demand for premium spirits.
He FTSE 100 Stalwart is also preparing acquisitions to expand its portfolio. As such, the potential for johnnie walker-owner to continue to increase his profits is certainly there. Therefore, its forward P/E of 20 could indicate that the stock has a fair value.
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