2 top Warren Buffett stocks to buy and hold for the long haul

These are two of the Oracle of Omaha's biggest tech investments.

| More on:
a smiling woman holds up two fingers and winks.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

One of the keys to Warren Buffett's phenomenal success over the years has been his willingness to buy stocks of good companies possessing long runways of future growth at discounted prices and then hold them for the long haul.

Using exactly that strategy, Buffett has generated aggregate gains of 3,641,613% since taking control of Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) in 1965, for a 20.1% compound annual growth rate (CAGR). In comparison, the S&P 500 has generated 30,209% in total returns over that period, for a CAGR of 10.5%. In other words, there's a good reason Buffett is referred to as the Oracle of Omaha and people buy, sell, and hold the same stocks he does. 

Buffett was relatively late in buying tech stocks, but he's made up for that since. The following pair of companies represent some of his biggest tech holdings. They fit neatly within his strategy, and you can also buy and hold them for the long run.


Apple (NASDAQ: AAPL) is not only Buffett's biggest tech holding but his largest holding overall, representing a whopping 41% of Berkshire Hathaway's total portfolio. With almost 1 billion shares under his management, the investing oracle has accumulated $128.2 billion worth of Apple stock. With shares down 23% from recent highs and at some of the lowest prices in the past year, it's a stock you might want to consider acquiring for your own portfolio.

The weakness has to do with the new iPhone 14, which reportedly faces weakening demand. The company reportedly reversed plans to hike production because of it, but such bearishness is all relative. 

The iPhone, which was unveiled in September and starts at $1,000, is still selling quite well, beating out low-cost entry-level models elsewhere, and Apple is still planning to produce some 90 million iPhone 14s, which is in line with its original forecast for the device.

Apple still commands about half of the U.S. smartphone market, despite the iPhone getting long in the tooth after having been first introduced 15 years ago. And MacBook shipments are going against the grain, with market intelligence firm IDC reporting shipments surging 40.2% in the third quarter compared with a 15% decline in global PC shipments. 

Yet, as much as hardware remains a driving force for Apple, services are the real growth opportunity going forward. Services account for 20% of total sales, though the company is not immune to economic concerns. Analysts estimate App Store revenue dropped 5% in September due to a sharp decline in gaming revenue as inflation and recession fears take a toll on consumers. Growth may be a little slower now than it was, but margins are rising, and at 71.5%, well above Apple's 43.3% overall gross margins.

There will be ups and downs in any business, but Apple will be commanding a leadership position for years to come and would be a stock to consider now and in the future.


Although Buffett first bought Verisign (NASDAQ: VRSN) nearly a decade ago, he has not accumulated nearly as much of its stock as he has of Apple's. He owns 12.8 million shares, worth some $2.3 billion. Not shabby, but it represents only 0.7% of the Berkshire portfolio, so its rise and fall won't have as great of an impact on performance. Still, it's one that investors ought to consider as well.

Verisign is the premier global provider of domain name registry services. It's the main company charged with doling out the .com, .edu, .gov, and .net domain names you find on the internet, while providing the routing support for them. Its behind-the-scenes operations basically point people to the correct website when they type in any site ending in those designations, helping to keep the world online and connected.

Verisign ended the second quarter with 351.5 million domain name registrations across all top-level domains, all of which pay a fee to it annually. It's been likened to the exclusive toll collector on the internet's "toll road," and it enjoys high-margin recurring revenue while having conversely low capital requirements, leading to very stable free cash flow generation.

There's no likelihood the internet is going anywhere, and its importance to business, even in the face of a potential recession, only continues to grow. Certainly, there was a massive uptick in the number of people starting their own businesses during the early months of the pandemic -- and registering their domain names -- that has since normalized, but that just underscores the long-term upward trajectory Verisign has at its back.

Buffett first bought Verisign in the fourth quarter of 2012, investing $143 million at an average of around $42 per share. With near monopoly-like status in its industry, careful stewardship of its business, and a cash-rich stream of revenue, the growth thesis behind Buffett's purchase of Verisign is still very much intact. With shares down 30% year to date, it may be the perfect time to buy your own stake, too.   

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Rich Duprey has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Apple and VeriSign. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has recommended the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Apple. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on International Stock News

A little Asian girl is so excited by the bubbles coming out of her bubble machine.
International Stock News

Opinion: This Nvidia forecast all but confirms that the artificial intelligence (AI) bubble will burst sooner rather than later

Nvidia's gross margin guidance points to pricing pressures that may signal an end to the irrational exuberance surrounding artificial intelligence…

Read more »

Hands reaching high for a trophy with a sunset in the background.
International Stock News

Is it too late to buy Nvidia stock in the second half of 2024?

The company has suffered from a recent sell-off, but maintains massive long-term potential.

Read more »

A white EV car and an electric vehicle pump with green highlighted swirls representing ASX lithium shares
International Stock News

Why Tesla could be the best 'Magnificent Seven' stock to own in the second half of 2024

Tesla's stock has been rallying of late, and there could be more gains to come in the weeks and months…

Read more »

A man holds his hand under his chin as he concentrates on his laptop screen and reads about the ANZ share price
International Stock News

The CEO of Nvidia just sold 700,000 shares of his company's stock. Here's what investors need to know

What could it mean?

Read more »

A man in a business suit peers through binoculars as two businesswomen stand beside him looking straight ahead at the camera.
International Stock News

Where will Nvidia stock be in 1 year?

You might be late to the party.

Read more »

asx share price boosted by us investment represented by hand waving US flag across winning athlete
International Stock News

Is it too late for ASX investors to start buying US shares?

Should ASX investors start taking the gains from US shares like Nvidia off the table?

Read more »

A US flag behind a graph, indicating investment in US shares
International Stock News

Which US shares are ASX investors buying in 2024?

The ASX's most popular US shares contain some familiar names...

Read more »

A man and a woman sit in front of a laptop looking fascinated and captivated.
International Stock News

Prediction: 2 US stocks that will be worth more than Nvidia 5 years from now

These US stocks have a shot at surpassing Nvidia over the next few years.

Read more »