Investors hang on to every word that investing legend Warren Buffett says, and it's at times like the current market when his wisdom guides investors more than ever.
At the Berkshire Hathaway annual meeting in May, he had some advice for investors about how to think about this rocky investing climate: "What has happened in the last 30, 45 days, 100 days ... It's really nothing ... If it makes a difference to you whether your stocks are down 15% or not, you need to get a somewhat different investment philosophy."
Buffett has said that his favorite holding period is forever, and that means holding on through good times and bad. Berkshire has had a position in American Express (AXP 1.70%) stock since 1994, and has owned a stake in Amazon (AMZN 0.60%) since 2019. And both are excellent stocks to buy today.
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1. Amazon: 0.8% of the portfolio
Amazon isn't your typical Buffett stock. It's relatively young and tech-focused, while Buffett tends to favor older companies with business models he fully understands, and he usually stays away from tech.
It's worth noting that he didn't actually make the call on adding it to Berkshire Hathaway's portfolio. One of his investing managers did. However, as he pointed out back in 2019, in many ways, Amazon does fit the Buffett mold as a stock pick. Even though it's a tech company, it's the largest e-commerce retailer in the U.S., with about 40% of the market. It has built up an incredible moat, and a durable advantage is something Buffett is always looking for in a stock.
He particularly loves leaders in consumer goods industries, such as Coca-Cola, Domino's Pizza, and Pool Corp -- and the fact that he bought shares of those last two recently is indicative of his thoughts on the current market.
Amazon's biggest business is e-commerce, but it is in the artificial intelligence (AI) space where it may have the most opportunity. Management is piling money into growing this business through the Amazon Web Services (AWS) segment, which provides cloud computing solutions.
The company is planning to invest more than $100 billion in growing its AI business in 2025 alone, outspending peers like Microsoft and Alphabet, which remain behind Amazon in cloud infrastructure market share. Amazon already offers a huge assortment of features targeting all types and sizes of businesses, such as SageMaker, a platform that unifies AI tools, which it says "has become the go-to service" for developers, providing services that make it easier to build and improve their AI models.
AI is already a multibillion-dollar business for Amazon, but management thinks it's just getting started. CEO Andy Jassy thinks it's only a matter of time before all businesses build AI into their apps, and they will have to move more of their digital systems to the cloud to make that happen. Not only will that boost Amazon's AI business, it will boost AWS as a whole because more clients will need to be on the platform to engage with AI.
Berkshire Hathaway's Amazon stake may not be a large portion of its portfolio, but it would make sense as a holding for most individual portfolios.
2. American Express: 15.7% of the portfolio
Buffett often uses American Express as an example of a great company. It has a moat in its global brand name, and it's resilient to macroeconomic headwinds due to its focus on an affluent clientele. Further, because it operates using a closed-loop model and acts as its own bank, it has multiple revenue streams, and that system cushions the business during different economic circumstances.
American Express uses a fee-based model for most of its credit cards that generates loyalty and feeds its bottom line. Members pay the fees and enjoy AmEx's stellar, industry-leading rewards program.
Fees typically increase at a higher rate than overall revenue and account for a substantial percentage of total company revenue. Total revenue increased by 8% year over year (on a currency-neutral basis) in 2025's fiscal first quarter, or 9% when accounting for the extra day in the quarter in 2024. Fee income increased by 20% and accounted for almost 14% of total revenue.
That's a strong performance considering the tight economy. And the company is also demonstrating robust risk management, as its net write-offs and delinquency rates remained steady over the past year. Higher interest rates mean higher net interest income for lenders, which is how this company can excel even if spending slows down.
Although it's celebrating its 150th anniversary this year, American Express is successfully capturing a younger clientele that's fueling growth now and should for decades to come. Gen X, millennial, and GenZ members together account for more than 70% of its membership, and they're spending at higher rates than baby boomers.
American Express is a top company with many long-term growth drivers, and it also pays a dividend. It would be a great anchor stock for many portfolios.
