Warren Buffett once famously stated that his "favorite holding period was forever." However, even a cursory examination of Berkshire Hathaway's (BRK.A 0.20%) (BRK.B 0.20%) portfolio changes through the years will show that Buffett doesn't hold most stocks as long as he said he prefers.
The reason why Buffett doesn't always hold stocks indefinitely can be found in the rest of his statement in his 1988 letter to Berkshire Hathaway shareholders. He conditioned holding a stock forever only for "outstanding businesses with outstanding management."
Which stocks meet that lofty criteria? Buffett has answered the question straightforwardly. Here is every stock Buffett has said he'd own practically forever.
1. Coca-Cola
Buffett sang the praises of The Coca-Cola Company (KO +0.46%) in his 2023 letter to Berkshire Hathaway shareholders. Berkshire has owned shares of Coca-Cola longer than any other stock. It's now the conglomerate's fourth-largest holding.
NYSE: KO
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In his 2024 shareholder letter, Buffett again referenced Coke, writing, "When you find a truly wonderful business, stick with it." He then noted that the stock was among several he expected to "maintain indefinitely."
2. American Express
Buffett also lauded American Express (AXP 1.40%) in the 2023 and 2024 letters to Berkshire Hathaway shareholders. His comments about sticking with a "truly wonderful business" and owning indefinitely applied to both Coca-Cola and AmEx.
Like Coca-Cola, American Express is a longtime holding for Buffett. Although he hasn't bought shares of the financial services giant in years, it ranks as Berkshire's second-largest position with a value of nearly $46 billion. The initial cost of the investment was only $1.3 billion.
3. Occidental Petroleum
In that 2024 shareholder letter, Buffett expanded the list of stocks he planned to own practically forever. Occidental Petroleum (OXY 1.23%) was the first stock he mentioned. After several years of Buffett aggressively buying the stock, Occidental is now Berkshire's sixth-largest holding.
NYSE: OXY
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Buffett explained why he favors Occidental so much, stating, "We particularly like its vast oil and gas holdings in the United States, as well as its leadership in carbon-capture initiatives, though the economic feasibility of this technique has yet to be proven." Keeping with his principle that forever stocks should have outstanding management teams, he applauded the leadership of Occidental CEO Vicki Hollub.
4, 5, 6, 7, and 8. The five Japanese Sogo Shosha
I've grouped the next five stocks because Buffett usually speaks about them collectively. They're the five Japanese sogo shosha (trading houses) in which Berkshire began investing in 2020:
- Itochu (ITOCF +0.12%) (ITOCY +0.66%)
- Marubeni (MARUY +0.63%)
- Mitsubishi (MSBHF +3.71%)
- Mitsui (MITSY +1.59%)
- Sumitomo (SSUM.Y +0.64%)
These Japanese stocks aren't huge positions for Berkshire. However, Buffett likes what he called their "shareholder-friendly policies." He also noted that these companies are highly diversified in a similar manner as Berkshire itself.
9. Apple
Surprisingly, Buffett didn't mention Apple (AAPL 0.85%) as one of the stocks he expected to own indefinitely in the 2024 shareholder letter. CNBC's Becky Quick asked him about the omission in Berkshire's annual shareholder meeting in May. He clarified, saying that Apple is "an even better business" than Coca-Cola and would remain in Berkshire's portfolio along with AmEx and Coke "unless something really extraordinary happens."
NASDAQ: AAPL
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I think that's a strong enough endorsement to include Apple on the list of Buffett's forever stocks. Sure, the legendary investor slashed Berkshire's stake in Apple last year. However, it remains the conglomerate's largest holding by far, making up 24.6% of its equity portfolio.
What about Berkshire Hathaway?
Here's an even bigger surprise: Berkshire Hathaway isn't on the list of stocks Buffett has said he'd own practically forever. Of course, Berkshire belongs in a league of its own for the "Oracle of Omaha" and is without question his primary forever stock. Some things don't have to be said to be clearly understood.
