It's no secret that Warren Buffett has a knack for picking great stocks. His investing expertise has helped Berkshire Hathaway build a $308 billion portfolio, and several positions in that portfolio have grown multiple times in value, including American Express and Coca-Cola. But Buffett still loses money on occasion, and two Wall Street analysts are forecasting declines in two of his stocks.

Walter Piecyk of LightShed Ventures recently downgraded Apple (AAPL 1.66%) to sell, slapping the consumer electronics giant with a 12-month price target of $120 per share, which implies 25% downside from its current price. Meanwhile, Patrick Colville of Scotiabank recently raised his 12-month price target on Snowflake (SNOW 1.02%) to $125 per share, but that still implies 16% downside from its current price.

Here's what investors should know.

Apple: 25% implied downside

Brand Finance recently recognized Apple as the second most valuable brand in the world. Its lineup of trendy electronics has inspired tremendous consumer loyalty, while affording the company significant pricing power.

Apple's brand authority has helped it achieve a strong competitive position in several end markets. In the fourth quarter, the company led the world in smartphone and smartwatch sales, and it has long been a leader in tablet sales.

Apple also has a thriving services business. Its installed base now exceeds 2 billion devices globally, up from 1 billion in 2016, and the company monetizes its massive user base with App Store fees and payments services, as well as subscription products like cloud storage and streaming content. And it has a strong competitive position in several of those markets as well.

For instance, the Apple App Store generated twice as much revenue as Alphabet's Google Play Store last year, and mobile app sales are expected to grow at 14% annually through 2026, according to Sensor Tower. Apple Wallet is the most popular in-store mobile payment option in the U.S., and global mobile-wallet revenue is expected to grow at 27% annually through 2030.

However, Apple missed revenue and earnings estimates in the fourth quarter as economic headwinds weighed on consumer spending. In fact, the company suffered its largest quarterly sales decline since 2016, as revenue dropped 5% to $117 billion. The current quarter could be even worse. According to IDC, Mac shipments fell 40% in the first quarter, the biggest decline among the five largest computer makers. That portends weak growth in other areas.

Currently, Apple stock trades at 27.3 times sales, above the five-year average of 24.4 times sales. That valuation multiple, coupled with inflationary headwinds, could certainly trigger a 25% drawdown in the share price.

For that reason, investors should avoid buying this FAANG stock right now. But Apple is a wonderful business, and patient investors have no reason to sell. In fact, if the share price does indeed drop 25%, it could be a buying opportunity.

Snowflake: 16% implied downside

Snowflake helps businesses manage and make sense of big data, a value proposition that should become increasingly relevant in the future.

Businesses already generate a tremendous amount of data, but the volume is growing due to digital transformation projects. However, data is often siloed across disparate systems, making it difficult to use. But businesses that solve that problem stand to gain a competitive edge over their peers, and the Snowflake Data Cloud was engineered to meet that need.

The Snowflake Data Cloud supports more workloads from a single platform than any other solution on the market, allowing clients to ingest, store, analyze, and share data sets without managing the underlying infrastructure.

Snowflake also provides tools for data transformation, a prerequisite for artificial intelligence and machine learning, and it offers resources for data-drive application development. The broad range of capabilities accessible through the Data Cloud, coupled with its infrastructure-neutral strategy -- meaning it runs across all three major public clouds -- has translated into strong demand and consistently solid financial results.

Not surprisingly, Snowflake beat top- and bottom-line estimates in the most recent quarter. Revenue increased 54% to $589 million, and free cash flow soared 193% to $205 million. That was driven by a 31% increase in customers, and a 58% increase in the average spend per customer.

But management expects revenue growth to decelerate to 40% in fiscal 2024 (which ends Jan. 31, 2024) as businesses tighten their budgets in response to economic uncertainty.

Currently, Snowflake stock trades at 22.2 times sales, a significant discount to the historical average of 73.8, but still a pricey valuation. That will likely translate into near-term volatility, and the stock could indeed slip 16% (or more) over the next year.

But patient investors have good reason to be optimistic. Snowflake has a differentiated product in a market that management values at $248 billion. If the stock price does indeed slip in the coming months, investors should consider buying a few shares of this growth stock.