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3 Robinhood Stocks That Warren Buffett Absolutely Loves

By Keith Speights – Sep 6, 2020 at 6:44AM

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Should you love them too?

Warren Buffett is about as different from the stereotypical Robinhood investor as you can get. Having just turned 90 years old, he's very experienced. He's arguably the most famous investor of all time, and ranks among the richest people in the world.

The Oracle of Omaha might not fit the profile of a Robinhood investor, but there are still stocks on the free online trading platform that he loves. Here are three of the top 100 most popular Robinhood stocks that Buffett adores.

Warren Buffett at an event.

Image source: The Motley Fool.

1. Berkshire Hathaway

As of Sept. 4, 2020, Berkshire Hathaway (BRK.A -0.06%) (BRK.B -0.95%) ranked No. 71 on Robinhood's Top 100 list. There's no doubt whatsoever, though, that Berkshire reigns as Warren Buffett's favorite stock.

Berkshire Hathaway was a textile manufacturing company when Buffett assumed control in the 1960s. He transformed it into a giant conglomerate over the years. Today, Berkshire's market cap stands at close to $520 billion. Buffett continues to serve as the company's chairman and CEO and owns around 16% of the company's outstanding shares (combining his Class A and Class B shares).

Buffett doesn't think very highly of most stocks on the market right now because of their steep valuations. He didn't even have Berkshire use much of its cash to invest during the stock market crash earlier this year. But there was at least one stock that Buffett still really liked: Berkshire Hathaway itself. The company spent over $5 billion repurchasing its shares in the second quarter of 2020.

2. Apple

What's the most popular stock on Robinhood? Apple (AAPL -3.00%). It's also pretty close to being Buffett's top stock. 

Berkshire owns over 245 million shares of Apple. That's by far the company's biggest holding, making up roughly 45% of Berkshire's total investment portfolio. Buffett even stated in an interview with CNBC earlier this year, "I don't think of Apple as a stock. I think it's our third-largest business." 

Why does Buffett love Apple so much? He told CNBC, "It's probably the best business I know in the world." The billionaire investor, who hasn't been a big fan of tech stocks in the past, views Apple as more of a consumer products company than a technology company.

3. Bank of America

Bank of America (BAC -1.50%) currently ranks as the No. 14 most popular stock among Robinhood investors. There's a pretty good argument to be made that the financial services giant is Warren Buffett's third-favorite stock.

Buffett has liked bank stocks for years. Berkshire owns big stakes in over half a dozen banks, but Bank of America has risen to the top spot among them. It lags behind only Apple as the biggest holding in Berkshire's portfolio. 

In recent months, Buffett's enthusiasm for Bank of America appears to have only increased. Berkshire made three huge investments in the stock during July and August totaling $1.7 billion. 

Should you love these stocks too?

Just because Berkshire Hathaway, Apple, and Bank of America are popular on the Robinhood trading platform doesn't mean they're great stocks to buy. The fact that one of the greatest investors of all time likes these three stocks also doesn't necessarily make them smart picks.

But should you love these stocks as much as Robinhood investors and Warren Buffett do? In my opinion, the answer is yes. 

I think Berkshire, Apple, and Bank of America have strong long-term growth prospects. Berkshire and Bank of America also claim valuations that are more attractive than most stocks on the market, and after last week's sell-off, Apple is less pricey. In my view, all three look like good picks for nearly any investor.

Keith Speights owns shares of Apple, Bank of America, and Berkshire Hathaway (B shares). The Motley Fool owns shares of and recommends Apple and Berkshire Hathaway (B shares) and recommends the following options: long January 2021 $200 calls on Berkshire Hathaway (B shares), short January 2021 $200 puts on Berkshire Hathaway (B shares), and short September 2020 $200 calls on Berkshire Hathaway (B shares). The Motley Fool has a disclosure policy.

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Stocks Mentioned

Apple Inc. Stock Quote
Apple Inc.
$138.20 (-3.00%) $-4.28
Bank of America Corporation Stock Quote
Bank of America Corporation
$30.20 (-1.50%) $0.46
Berkshire Hathaway Inc. Stock Quote
Berkshire Hathaway Inc.
$267.02 (-0.95%) $-2.56
Berkshire Hathaway Inc. Stock Quote
Berkshire Hathaway Inc.
$406,470.00 (-0.06%) $-230.00

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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