Warren Buffett disciples are always wondering which stock the Oracle of Omaha will add to the Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B) portfolio next.

Of course, no one knows for sure where he'll place his bets, but we can certainly figure out which stocks out there might "feel at home" in today's Berkshire Hathaway family, based on some key metrics of the current portfolio. According to Capital IQ, these include:

  • A median price-to-earnings ratio of 16.4
  • A median price-to-book ratio of 2.3
  • An average dividend yield of 2.4%
  • An average beta of 0.75

We can further whittle down the list of potential Buffett ideas by eliminating stocks with spotty earnings histories, a new management team, or a complicated business model (or any combination of these). These are situations that the man himself has said he avoids.

So with those things in mind, we'll take a look at five highly rated companies that fit the Berkshire profile and enlist the assistance of 100,000 investors participating in Motley Fool CAPS, as well as the new CAPS stock screener.

Here are a few of the results:




Dividend Yield

CAPS Rating (5 max)

American Eagle Outfitters (NYSE: AEO)





Bank of Nova Scotia (NYSE: BNS)





Edison International (NYSE: EIX)





Genuine Parts (NYSE: GPC)





PPG Industries (NYSE: PPG)





Data provided by Motley Fool CAPS and Yahoo! Finance, as of May 6, 2008.

Not only do these five highly rated stocks meet valuation metrics similar to the current Berkshire portfolio, but also they are proven earnings growers, have CEOs with at least three years on the job, and have easy-to-understand business models. On those grounds, at least, each of these companies wouldn't seem out of place in today's Berkshire portfolio.

So are these potential Buffett picks? Or does some flaw keep them out of contention? Make your voice heard on Motley Fool CAPS today, where 100,000 investors are waiting to see what you have to say.

PPG Industries, Genuine Parts, and Bank of Nova Scotia are Motley Fool Income Investor selections. Berkshire is an Inside Value pick. Berkshire and American Eagle Outfitters are Stock Advisor selections, and The Fool owns shares of Berkshire and American Eagle Outfitters. Try any of our Foolish newsletters today, free for 30 days.

Todd Wenning hustles and flows only when he thinks no one is looking. He does not own shares of any company mentioned. The Fool's disclosure policy is a lyrical lexicon.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.