When Warren Buffett became Berkshire Hathaway's (BRK.A -1.78%) (BRK.B -1.89%) CEO in 1965, the company's stock was priced at $19 per share. Today, its Class A shares trade at roughly $419,000 -- good for price growth of roughly 2,205,700% since he took over the business.
Buffett and his team have an incredible stock-picking track record, and it's no surprise that people keep a close eye on their stock moves and continue to follow Buffett's investing strategies.
With that in mind, here are a couple of stocks in the Berkshire Hathaway portfolio that are worth buying this month.
At first glance, Snowflake (SNOW 1.09%) appears to be a far cry from the kind of company that Buffett typically favors. In addition to operating in a complex and fast-changing corner of the tech industry, the cloud data specialist's stock is not a value play by any conventional definition. So, why did Buffett and Berkshire make a substantial investment in the company during its initial public offering (IPO) in September?
Business success in the future will increasingly hinge on how well companies are able to utilize valuable data, and Snowflake provides services that help its clients do just that. It assists its customers in organizing and analyzing data collected from different cloud platforms. And with demand for its services strong, Snowflake is growing at a rapid clip.
Sales rose by 110% year over year last quarter to $213.8 million, and the company's customer count surged by 67% to 4,532. Equally impressive, Snowflake posted a dollar-based net retention rate of 168%, which means that customers already using its platform spent 68% more with the company than they did in the prior-year period.
The revenue retention trend indicates that its clients are finding Snowflake's data platform to be valuable, and that points to big growth opportunities down the line. Its first-mover advantage in the data warehousing space has helped it build a large and influential base of clients and partners, and features it offers that enable data sharing and analysis among customers have created a powerful network effect.
With a market cap of approximately $80 billion and trading at roughly 71.5 times this year's expected sales, Snowflake has a highly growth-dependent valuation and doesn't fit the traditional mold of a Buffett stock. However, the business is showing signs of a powerful, developing moat, and it has huge room for expansion by bringing new clients on board and expanding the services it offers them.
Is now a good time to buy Amazon (AMZN 0.91%) stock? If you asked that question at any time since its public market debut in May 1997, the benefit of hindsight will show the answer was a resounding "yes." The company's share price has climbed by roughly 24,150% over the last two decades alone, delivering strong returns to anyone who took a buy-and-hold approach to its stock.
Berkshire Hathaway didn't buy Amazon stock until 2019 and Buffett has admitted that he was "an idiot" for not buying into the company earlier. But Berkshire has still benefitted significantly from its relatively recent investment and is hoping for more growth going forward.
No one can say what the future holds with perfect certainty, but yes, it's probably still a good time to buy Amazon stock. The tech giant has built market-leading positions in e-commerce and cloud computing, two of the world's most influential industries, and it looks poised to deliver more wins for investors as it benefits from long-term growth in these markets.
The popularity of Amazon's e-commerce platform gives it huge leverage in the online advertising space, and its strength in cloud infrastructure and data analysis are also creating synergies that are helping it grab market share from Alphabet and Facebook. Research from eMarketer estimates that Amazon's share of the U.S. digital advertising market will rise from 13% in 2019 to more than 20% in 2022, and there's a good chance it will keep climbing from there.
Amazon is a great business that enjoys huge competitive advantages, and it's likely that its growth story has many chapters left. This "set it and forget it" stock can still deliver big wins for patient investors.