Warren Buffett would probably be the last person on the planet to predict how stocks will perform over the short term. The legendary investor is much more focused on the long-term business prospects for the stocks he buys for Berkshire Hathaway (BRK.A 0.67%) (BRK.B 0.66%).
That is absolutely the correct mindset to have. However, if I had to pick the stocks in Berkshire's portfolio that would probably deliver strong gains over the near term, the decision wouldn't be that difficult. Here are the three Buffett stocks I think are most likely to soar in Q4.
1. Chevron
Chevron (CVX 0.74%) now ranks as the fourth-largest position in Buffett's portfolio. It's one of the few stocks that the Berkshire Hathaway CEO has been consistently buying for several consecutive quarters.
The oil and gas giant also stands as one of the few big winners for Buffett so far in 2022. Chevron's share price has jumped close to 30% year to date. This gain stemmed in large part from Russia's invasion of Ukraine, a move that disrupted the global energy market.
I think that Chevron stock will probably move even higher in Q4. Any hopes that the Russia-Ukraine conflict would end quickly have evaporated. European Union leaders agreed to ban 90% of most Russian oil imports by the end of this year. OPEC+ members are meeting this week to consider cutting oil production.
All of this could translate to higher oil prices, which would be bad news for the public but good news for Chevron. With shares trading at around nine times expected earnings, Chevron's valuation isn't so great that the stock wouldn't benefit from further global supply tightening.
2. Occidental Petroleum
Buffett has become a huge fan of Occidental Petroleum (OXY 0.48%). After months of aggressive buying, Berkshire now owns nearly 21% of the oil and gas company.
Occidental has been the best-performing stock in Berkshire's entire portfolio so far this year. Its shares have skyrocketed by more than 120%. At one point, Oxy was up over 150% year to date.
Can Occidental keep its momentum going in Q4? I think so. Importantly, the company benefits from the same global dynamics that should help Chevron. The two stocks also share nearly identical forward earnings multiples.
But there's another factor that could boost Occidental stock even more this year. In August, Berkshire won regulatory authorization to acquire up to 50% of Occidental. If Buffett keeps buying shares, it's almost a certainty that Occidental stock will keep rising.
3. Apple
You could make a good case that Apple (AAPL 0.24%) ranks as Buffett's favorite stock after Berkshire itself. Apple is by far the biggest holding in Berkshire's portfolio. Buffett has referred to it as one of Berkshire's "four giants." The other three "giants" -- the insurance business, BNSF Railway, and Berkshire Hathaway Energy -- are Berkshire subsidiaries.
Unlike Chevron and Occidental, Apple has been a loser for Buffett in 2022. Shares of the tech giant have plunged around 20% year to date.
Don't think for a second that Apple can't rebound strongly in Q4, though. One key reason behind the stock's recent slide is a Bloomberg report that Apple asked certain suppliers to scale back production of the new iPhone 14. But stories based on anonymous sources don't always pan out.
At least one Wall Street analyst, Rosenblatt Securities, thinks that consumers in the U.S. and in other countries could enthusiastically buy Apple's new products. All it would take for Apple stock to soar from current levels is for the company to beat sales expectations during the holiday season.
