HomeBusinessHere are Warren Buffett's top stock picks in artificial intelligence (AI).

Here are Warren Buffett’s top stock picks in artificial intelligence (AI).

Famed investor Warren Buffett is not known as a technology guru; its reputation comes from opportunistically buying and holding old blue chip stocks Berkshire Hathawayits holding company, which today is worth almost a trillion dollars.

However, Berkshire Hathaway’s portfolio is secretly very heavily invested in artificial intelligence (AI). Representing the top four AI stocks by position size almost half the entire portfolio!

So take a closer look at Buffett’s four best AI stocks:

Table of Contents

1. Apple

Warren Buffett isn’t afraid to let a winning investment become a big part of Berkshire’s portfolio. Look no further than the iPhone maker Apple (NASDAQ: AAPL). The share, which Buffett first bought in 2016, has grown to 44.2% of the portfolio. Nevertheless, Apple is a bona fide AI stock, and Buffett has sold only minimal shares despite posting huge unrealized gains today. Why? Buffett has credited fierce customer loyalty and joked that people would trade in their second car for an iPhone.

Technology companies, including Apple, are investing in AI and combining it with their consumer-facing products. Apple has already implemented AI into the iOS experience for greater convenience, such as Siri support, facial recognition, content recommendations and more. However, Tim Cook recently told an event that Apple is prioritizing investments in generative AI. It recently halted its electric car project and will transfer human resources to Apple’s AI division. Brace yourself for the future.

See also  These stocks are moving the most today: Snowflake, Salesforce, Okta, C3.ai, Duolingo, AMC, Marathon Digital and more

2. Moody’s

Corporate credit and analysis agency Moodys (NYSE: MCO) looks more like Buffett’s well-known style. Berkshire has owned the shares of Moody’s since 2000 and it has been a very successful investment over the years. It’s a much smaller part of Berkshire’s portfolio at 2.5%, but then again, Moody’s is a much smaller company than Apple. Berkshire’s stake represents a 13.5% ownership in the company.

Moody’s analyzes data to rate corporate credits and sell market research. Artificial intelligence is a natural progression for a company like Moody’s. The company has invaluable data from decades of operations and uses OpenAI and Azure to build models on that data. Moody’s evolution towards more technology-driven data analysis is critical to maintaining its excellent reputation in the financial markets. Moody’s has seen revenue growth for 64 consecutive quarters, a testament to the company’s sustainability.

3. Amazon

Tech giant Amazon (NASDAQ: AMZN) is a stock that Buffett came into contact with late; he didn’t add shares to Berkshire’s portfolio until 2019. Since then, however, shares have more than doubled, showing that it’s almost never too late to invest in great companies. Amazon has built a reputation as an innovator. After becoming the dominant e-commerce company in America, Amazon has since built a leading cloud platform and streaming service and is now leaning on AI.

See also  Payable to the death account versus transfer to the death account

Like Apple, Amazon uses generative AI in its consumer-facing businesses. E-commerce customers can view a product, and AI will summarize buyers’ product reviews into abbreviated summaries to save time. In AWS, Amazon accumulates vast resources including Nvidia chips and its own chips, to give cloud customers the tools to build AI applications. Amazon’s ability to integrate AI into its operations could support long-term growth in e-commerce and cloud industries where there is still gas in the tank.

4. Snowflake

Data cloud and analytics company Snowflake (NYSE: SNOW) is a unique Buffett AI stock because it is the only one Berkshire Hathaway has invested in since day one. The holding company participated in Snowflake’s public offering in 2020 and has held the shares since then. It’s also the smallest holding of the companies on this list, representing just 0.3% of Berkshire’s portfolio.

Snowflake could become a huge company in the AI ​​era. The company’s cloud platform stores and organizes data so customers can easily search it and integrate it with third-party apps, all via the cloud. In addition, Snowflake operates a data marketplace where customers can share data and purchase access to third-party datasets to combine with their own.

See also  Why Intel Stocks Keep Falling

Data is essentially the building block of AI because it is all trained on data. That makes Snowflake potentially crucial to the advancement of AI, and it’s notable that Berkshire jumped into the stock early.

Should You Invest $1,000 in Apple Right Now?

Before you buy shares in Apple, consider this:

The Motley Fool stock advisor The analyst team has just identified what they think is the 10 best stocks for investors to buy now… and Apple wasn’t one of them. The ten stocks that survived the cut could deliver monster returns in the coming years.

Stock Advisor provides investors with an easy-to-follow blueprint for success, including portfolio building guidance, regular analyst updates, and two new stock picks per month. The Stock Advisor service has more than tripled the return of the S&P 500 since 2002*.

View the 10 stocks

*Stock Advisor returns February 26, 2024

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Justin Pope has no position in any of the stocks mentioned. The Motley Fool holds positions in and recommends Amazon, Apple, Berkshire Hathaway, Moody’s, Nvidia, and Snowflake. The Motley Fool has a disclosure policy.

Here Are Warren Buffett’s Top Artificial Intelligence (AI) Stock Picks was originally published by The Motley Fool

- Advertisement -
RELATED ARTICLES

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Most Popular

Recent Comments