You can find lots of free investing ideas. Just look pretty much anywhere online. The quality of the suggestions you'll find will vary quite a bit, though.
But there's one free source of investing ideas that is definitely top tier: the quarterly regulatory filings of Berkshire Hathaway (BRK.A +0.93%) (BRK.B +1.14%). These filings reveal exactly which stocks Warren Buffett -- one of the greatest investors of all time -- has been buying and selling lately.
Of course, right now might not be the best time to invest in some of the stocks that Berkshire added to its portfolio years ago. However, several of his portfolio holdings are great picks that should be winners. Here are three Buffett stocks to buy in December.
1. Vanguard 500 Index Fund ETF
No, the Vanguard 500 Index Fund ETF (VOO 0.11%) (or VOO for short) isn't really a stock. It's an exchange-traded fund (ETF) that tracks the S&P 500 index. But VOO is listed along with dozens of other stocks in Berkshire's 13F filing. It's bought and sold just like a stock. And it holds 503 stocks (some S&P 500 companies have more than one share class). My view is that if it looks like a duck, swims like a duck, and quacks like a duck, you can treat it as a duck.
NYSEMKT: VOO
Key Data Points
In his annual letter to Berkshire Hathaway shareholders in 2013, Buffett wrote that most investors shouldn't try to pick individual stocks. Instead, he recommended people invest in a low-cost S&P 500 fund. He also noted that in his will, he advises the trustee of his estate to invest the cash that his family inherits primarily in such index funds. And Buffett specifically suggested going with Vanguard.
I suspect that if you could ask Buffett face-to-face today where to put your money, he'd point you to the Vanguard 500 Index Fund ETF. He'd also probably tell you to keep adding to your position over time and to not sell when the stock market sinks. I can say this with confidence because it's exactly the advice he gave to Berkshire shareholders in that 2013 letter.
Over the long run, buying and holding shares of the Vanguard 500 Index Fund ETF should generate significant returns. Buffett wouldn't recommend that retail investors buy it if he believed otherwise.
2. Occidental Petroleum
Which individual stocks is Buffett pouring the most money into these days? Occidental Petroleum (OXY +2.05%) ranks high on the list. He aggressively bought shares of the oil and natural gas producer earlier in 2022. I think that Occidental is one of the best of the eight stocks Buffett bought in the third quarter for Berkshire Hathaway's portfolio.
NYSE: OXY
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One reason to consider buying Occidental for your own portfolio is that the stock remains attractively valued despite its huge gains this year. Shares currently trade at 5.6 times levered free cash flow.
However, I think there's an even stronger argument in favor of buying the stock in December. Berkshire Hathaway currently owns 21.4% of Occidental, but was given regulatory approval in August to acquire up to 50% of the energy company. I fully expect that Buffett will continue to scoop up shares, pushing Occidental's price even higher in the first half of next year.
3. Amazon
To my knowledge, Buffett has never recommended that other investors buy Amazon (AMZN 1.19%). He also isn't adding shares of the e-commerce and cloud hosting stock to the Berkshire Hathaway portfolio. And, while the conglomerate owns a relatively small stake in Amazon, that position was initiated by one of its two investment managers, not Buffett himself.
But I believe that now is a great time to buy Amazon stock. For one thing, Amazon's shares have fallen by their largest percentage from their peak since the Great Recession. Although the stock might not look cheap based on commonly used valuation metrics, those metrics have never been very helpful when attempting to gauge Amazon.
NASDAQ: AMZN
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The tech giant does face some challenges, including slowing revenue growth and soaring costs. However, those should be only temporary issues. The economic climate will get better sooner or later, boosting Amazon's sales. Also, the company is cutting costs, which that should improve its profitability.
History shows that it has always been smart to bet on Amazon when its stock was struggling. And while they say that history doesn't repeat itself, I suspect it will with this juggernaut.
