Billionaire investor Warren Buffett may be stepping down as CEO at the end of the year, but until then, we can still look at -- and learn from -- the investing portfolio he's built at Berkshire Hathaway (BRK.A 0.82%) (BRK.B 0.81%). Featuring a diversified group of stocks, Berkshire's portfolio is shared with the public every quarter through its SEC filings, so it's easy to know what Buffett is buying.
Buffett may have billions of dollars at his disposal, but even if you just have $1,000, you can start building a Buffett-like portfolio. In fact, you could start today by buying one share each of three Buffett stocks, and it would only cost you about $975, so you'd have some wiggle room if prices rise slightly.
Here are the three stocks (in alphabetical order) and why they make a great starter "mini-Buffett" portfolio.
Image source: The Motley Fool.
Amazon, $235/share
E-commerce titan Amazon (AMZN 1.27%), a Berkshire holding since 2019, just reported its third-quarter earnings, and it did so well that its share price rose by 14%! However, it's since dropped a bit thanks to the broad tech sell-off. That makes it surprisingly the cheapest share price on this list -- even though the company, with a $2.5 trillion market cap, is by far the largest of the three.
NASDAQ: AMZN
Key Data Points
Amazon is known, of course, for its e-commerce site and its consumer-focused entertainment services, including Amazon Prime Video and Amazon Music. However, one of the company's biggest growth engines is its Amazon Web Services (AWS) cloud-based web platform. AWS is the largest cloud services provider in the world, and it keeps getting larger. In Q3, AWS sales increased by 20% year over year to $33 billion.
With demand for both cloud services and e-commerce only expected to grow in the coming years, Amazon stock should continue to climb long after Buffett's retirement.
Domino's Pizza, $410/share
The largest pizza chain in the world, Domino's Pizza (DPZ +0.36%) is one of the newest additions to the Berkshire Hathaway portfolio, first appearing in Q3 2024. Subsequent buys have raised Berkshire's position to more than $1 billion.
Domino's has more than doubled its annual revenue over the last 10 years to $4.8 billion, and it has more than tripled its net income to $589.5 million. However, it's also been outperforming its rivals over the short term. In its most recent quarter, the company's U.S. same-store sales growth clocked in at 5.2%, which decisively beat the 1.6% same-store sales growth of rival Papa John's, and absolutely crushed Pizza Hut's negative sales growth, which declined by about 1%.
NASDAQ: DPZ
Key Data Points
The company is expected to outperform in the short term thanks to the value it offers to consumers, whose purchasing power has been hit by inflation. When various deals are factored in -- like the current "pick any two medium two-topping pizzas for $6.99 each" deal -- you can usually get enough Domino's pizza to feed a family of four for less than $15 in most markets. That's an unrivaled value proposition.
Another great-looking value proposition is Domino's stock. Despite the company's recent outperformance, its shares are down by about 6.7% over the past year, which means you can pick up a share of the stock -- and its current 1.6% dividend yield -- for less than Buffett likely paid. Now that's a tasty deal!
Visa, $330/share
Credit card brand and payments processor Visa (V 1.84%) has seen its share price rise more than 55% over the last five years. A longtime Berkshire holding, Visa stock -- along with the stock of fellow payment processor Mastercard -- has been a part of Buffett's portfolio since 2011.
NYSE: V
Key Data Points
In 2024, Visa processed roughly $16 trillion in payment volumes across more than 300 billion transactions worldwide. Over the last 10 years, it has grown net revenue by a compounded annual growth rate (CAGR) of 11% and has grown per-share earnings by an even more impressive CAGR of 17%.
Management expects to maintain its industry-leading position by continuing to expand its market share in the consumer payments space, particularly among non-card payments, as well as by tapping new opportunities in commercial payments and value-added services, like advisory services, risk management, and financial security.
Visa's shareholder-friendly management has consistently raised the company's dividend each year, often by generous double-digit percentages, but its share price has been appreciating so quickly that the yield has remained fairly consistent at about 0.75% over the past decade. Consistency plus dividend increases make for a classic Buffett stock, and Visa fits the bill.
Different companies, but the same Buffett-favored qualities
Amazon, Domino's, and Visa are three very different companies, in different industries, with different paths to success, but all fit the Buffett formula of great businesses churning out reliable growth. Adding one share of each to a "mini-Buffett" portfolio would be a great way to allocate $1,000 and still have a little bit left over.
