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Warren Buffett Goes on a Stock Buying Spree

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·3 min read
In this article:
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  • (1:00) - Berkshire Hathaway Is Making Moves: Should You Be Buying The Dip Too?

  • (7:45) - Following The Moves Of Warren Buffett: What Was He Buying?

  • (26:05) - Episode Roundup: CVX, OXY, C, PARA, HPQ, CE, MKL, ALLY,  RH, GM

  • Podcast@Zacks.com

 

Welcome to Episode #282 of the Value Investor Podcast.

Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio, shares some of her top value investing tips and stock picks.

In 2022, it’s not just growth stocks that are selling off. Many value stocks have gotten cheaper too.

And Warren Buffett, who faced criticism in 2020 when he didn’t buy any stocks in the big coronavirus sell-off, is now deploying billions of dollars in 2022.

Berkshire Hathaway dove in with big positions in energy, added more financials and even bought shares in a cheap media company.

Buffett’s buying is sending a signal to all value investors: stocks are cheap. It’s time to get great companies on sale.

What Berkshire Is Buying in 2022

1.       Chevron CVX

Chevron is one of the largest energy companies in the United States. Berkshire Hathaway already owned some shares but Buffett bought more, pushing Chevron up to the 4th largest position in the portfolio. It’s now 7% of the portfolio.

Chevron shares are up 42% year-to-date but it’s still cheap. It trades with a forward P/E of 10.2.

Chevron also pays a nice dividend, currently yielding 3.2%.

Is it time to follow Buffett into Chevron?

2.       Occidental Petroleum OXY

Berkshire was also buying billions of dollars of Occidental Petroleum as well, pushing it up to the 6th largest position in the portfolio at 3.57%. Combined with Chevron, big energy companies are now over 10% of the equity portfolio.

Occidental Petroleum is dirt cheap. It trades with a forward P/E of 6.5 even though shares are up 129% year-to-date.

Is there more upside in Occidental Petroleum in 2022?

3.       Citigroup C

Citigroup has been ignored by Wall Street over the last year. Shares are down 32% during that time.

But Citigroup is also one of the cheaper large banks, with a forward P/E of 7.5. It also pays one of the higher dividends, currently yielding 3.9%.

This new Citigroup position is now the 15th largest position in the portfolio and joins other financials like Bank of America, which is the second largest position.

Is it time to get back into the big banks like Citigroup?

4.       Ally Financial ALLY

Ally Financial offers digital financial services in auto finance and insurance. Shares are down 16% year-to-date.

Ally Financial is also dirt cheap. It is trading with a forward P/E of just 5. Ally Financial pays a dividend yielding 3.1%.

Should investors be looking beyond the big banks for investing opportunities?

5.       Paramount Global PARA

Paramount Global is a global media company with many brands including Paramount, Showtime, MTV and others.

Paramount Global shares are actually up year-to-date, gaining 5.8% but are down 23% over the last 52-weeks. Shares are cheap with a forward P/E of just 11.9. But Paramount Global’s earnings are expected to decline 23.6% in 2022.

Paramount Global pays a dividend yielding 3%.

Are media companies a value play in 2022?

What Else do you Need to Know About Warren Buffett’s Buying Spree in 2022?

Tune into this week’s podcast to find out.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Citigroup Inc. (C) : Free Stock Analysis Report
 
Chevron Corporation (CVX) : Free Stock Analysis Report
 
Occidental Petroleum Corporation (OXY) : Free Stock Analysis Report
 
Ally Financial Inc. (ALLY) : Free Stock Analysis Report
 
Paramount Global (PARA) : Free Stock Analysis Report
 
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