Warren Buffett has certainly delivered stronger performances by this point in previous years. Shares of Berkshire Hathaway (BRK.A -0.37%) (BRK.B -0.37%), the company he's managed for decades, are up less than 5% year to date. Relatively speaking, though, Buffett is doing quite well considering that the S&P 500 is down by a double-digit percentage.
Berkshire's portfolio has plenty of laggards in the overall dismal market. However, there are several huge winners as well. Here are Buffett's best stocks of 2022 so far -- and whether or not they're good picks to buy now.
1. Occidental Petroleum
Occidental Petroleum (OXY -0.48%) wasn't in Berkshire's holdings at the end of the fourth quarter of 2021. But regulatory filings with the Securities and Exchange Commission (SEC) revealed that Buffett, Berkshire, and several of its subsidiaries invested heavily in Oxy in March 2022.
The energy stock has skyrocketed more than 130% so far this year. Much of that jaw-dropping gain came after the news broke about Buffett's initial purchases.
It's apparent that Buffett doesn't think Oxy's momentum will fade anytime soon. Only a couple of weeks ago, he (along with Berkshire and some of its subsidiaries) scooped up even more shares of the oil and gas company.
Buffett began pouring money into another energy giant, Chevron (CVX -0.37%), in 2020. The legendary investor probably thought that the company would benefit as the global economy recovered from the initial shock of the pandemic.
That bet on Chevron has paid off nicely. The stock has soared nearly 50% year to date after jumping 39% last year.
But is Buffett still bullish about Chevron? Absolutely. Berkshire added to its position in the energy company in the first quarter of 2022. Chevron now ranks as Berkshire's third-largest holding.
Berkshire opened new positions in eight companies in the first quarter of 2022. McKesson (MCK 0.11%) was the only healthcare stock in the group. It's also now one of only four healthcare stocks in Berkshire's portfolio.
McKesson's shares are up more than 30% so far this year. We don't know exactly when Berkshire invested in the healthcare services leader, though. It's uncertain, therefore, just how big of a gain Buffett and company have realized.
Berkshire's stake in McKesson is a relatively small one, with a market value of $895 million at the end of the first quarter. However, Buffett is known for adding to his positions in subsequent quarters after buying an initial stake when he really likes a company.
Are they buys?
You shouldn't invest in a stock just because Buffett has done so. Your goals and time horizon might not align with those of Berkshire Hathaway. But it can be helpful to at least consider the stocks that are being bought by one of the world's greatest investors of all time.
The tailwinds that have driven Oxy and Chevron higher don't appear to be dying down. Both stocks could continue to deliver gains through the end of the year.
If the economy enters a recession, though, the demand for oil and gas could decline. My view is that of the two, Chevron is the better pick for long-term investors thanks to its strong financial position and its clean energy initiatives.
The prescription drugs and medical-surgical supplies that McKesson distributes will be needed whether a recession is around the corner or not. Its business model is resilient. That makes the stock especially attractive during uncertain times. I think that McKesson remains a good pick to buy right now, and I won't be surprised if Buffett scoops up more shares in the next few quarters.