Not all billionaires make for great role models. But if you're striving to create wealth in the stock market, you'd be hard-pressed to find a better mentor than Warren Buffett.
Buffett is unquestionably one of the best investors of all time. The business he helped build into a masterpiece of American capitalism, Berkshire Hathaway (BRK.A -0.76%) (BRK.B -0.69%), has delivered fortune-building gains to its investors for more than 50 years.
Fortunately, it's relatively easy to invest alongside Buffett by buying and holding shares in the great companies Berkshire has invested in. Here are three Buffett-approved stocks that could help you grow richer in the coming years.
1. Visa
Powerful, enduring trends can create lucrative opportunities for investors. The global shift from cash to digital forms of payment is one such megatrend. As the leading credit and debit card processing network, Visa (V -0.23%) is perfectly positioned to capture the lion's share of the payment industry's profits -- and deliver them to its shareholders.
Visa's network extends across more than 200 countries and territories. Its scale is breathtaking. Visa processed 270 billion transactions totaling $14.5 trillion during the year ended June 30. Its 4.2 billion credit and debit cards are accepted at over 100 merchant locations.
Visa's business model is similar in some ways to that of a tollbooth. It earns a small fee for every transaction it facilitates. Those fees helped Visa earn a staggering $16.5 billion in profits over the trailing 12 months -- a figure that should climb steadily higher in the years ahead.
2. Coca-Cola
It's true that consumers are moving away from sugary drinks. Fortunately, Buffett favorite Coca-Cola (KO) is far more than just a soda company.
The beverage giant's diversification efforts have yielded healthier offerings such as milk, juice, tea, coffee, and nutrient-enhanced water. Popular brands like Fairlife, Simply, Gold Peak, Costa Coffee, and Vitaminwater are housed within Coca-Cola's unrivaled global marketing and distribution system.
Coca-Cola's ability to launch new products that satisfy consumers' shifting preferences should enable it to grow its revenue and profits steadily higher over time. The beverage titan has increased the cash dividend it pays to its shareowners for 61 straight years.
This impressive level of consistency makes Coca-Cola a low-risk, all-weather stock. And with its shares currently yielding more than 3%, now is a great time to invest in this stalwart company.
3. Apple
We'll close with Buffett's largest holding. Berkshire Hathaway owns a stunning $162 billion worth of Apple (AAPL -0.35%) stock.
It's not hard to see why the iPhone maker has caught Buffett's fancy. Apple's products are beloved by its loyal customers for their quality and reliability. Its brand prestige allows Apple to command higher prices for its devices, which fuels its unmatched profitability. Buffett also no doubt appreciates Apple's fortress-like balance sheet, which contained over $166 billion in cash investments as of July 1.
Moreover, Buffett understands the value of Apple's steadily expanding services business. With more than 2 billion active devices and over 1 billion paid subscriptions, Apple's services produce recurring, utility-like streams of high-margin revenue.
You'd be forgiven for thinking those astronomical device and subscriber metrics would preclude Apple from growing further. But that's just not the case. Massive international markets like India remain largely untapped. At the same time, Apple's investments in game-changing technologies like augmented reality and artificial intelligence are likely to unearth exciting new growth opportunities.
Buffett once said that Apple is "probably the best business I know in the world." With $95 billion in net income over the trailing 12 months, it's certainly one of the most lucrative. Buy shares today, and you invest alongside Buffett and claim your share of this tech titan's future profits.
