If any investor has stood the test of time, it is Warren Buffett. For years, the “Oracle of Omaha” has had a rock-star-like presence in the investing world. His annual Berkshire Hathaway shareholders meeting draws literally thousands of loyal fans who are investors. Known for his long buy-and-hold strategies and his massive portfolio of public and private holdings, he remains one of the preeminent investors in the world.
One reason for Berkshire Hathaway’s stunning success over the years is that Buffett and his right-hand man, Charlie Munger, have always tried to stay with stock ideas they understand. That has proven to be a winning hand. In addition, many of the companies in their portfolio pay solid and reliable dividends.
Top Wall Street pundits have been amazed at the second-quarter additions Buffett has made to the Berkshire Hathaway portfolio in the energy sector, as he continues to build a gigantic stake in one company and, according to the most recent 13-F filings, added shares of another integrated energy giant during the quarter. Of the approximately $3.8 billion he invested during the second quarter, a large portion was directed to these two stocks.
Both of the stocks Buffett owns are Buy rated on Wall Street, as are five additional ideas investors should consider now. Oil prices tumbled during the summer and could be poised for a major move higher, as OPEC is considering production cuts after the flood of Russian oil hit the market.
It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
Berkshire Hathaway Energy Stocks
This integrated giant posted huge second-quarter results and remains a safer way for investors looking to get positioned in the energy sector. Chevron Corp. (NYSE: CVX) engages in integrated energy and chemicals operations worldwide.
The Upstream segment is involved in the exploration, development, production and transportation of crude oil and natural gas; processing, liquefaction, transportation and regasification associated with liquefied natural gas (LNG); transportation of crude oil through pipelines; and transportation, storage and marketing of natural gas, as well as operating a gas-to-liquids plant.
The Downstream segment engages in refining crude oil into petroleum products; marketing crude oil, refined products and lubricants; manufacturing and marketing of renewable fuels; transporting crude oil and refined products by pipeline, marine vessel, motor equipment and rail car; and manufacturing and marketing of commodity petrochemicals, plastics for industrial uses, and fuel and lubricant additives. It is also involved in cash management and debt financing activities, insurance operations, real estate activities and technology businesses.
Chevron stock comes with a 3.62% dividend. Credit Suisse’s $202 target price is well above the $175.70 consensus target. The shares closed more than 3% higher on Tuesday at $161.94.