Warren Buffett, the CEO of Berkshire Hathaway, is known for his investment strategies. His company has achieved a nearly 5,700,000% return since he took over in the 1960s. Many investors try to copy his trades.
Berkshire Hathaway’s latest filing shows that Domino’s Pizza has become Buffett’s new stock of interest. Over the past 20 years, Domino’s stock has increased by about 7,000%, including dividends. Despite this growth, Domino’s has never done a stock split to make its shares more accessible.
Domino’s shares are trading around $439, which may be high for small investors. This has led to speculation that Domino’s could do a stock split in 2025, making its shares more affordable. Domino’s “Hungry for MORE” plan has been giving good results.
The plan focuses on:
– Innovating products to attract customers
– Using technology and efficient procedures to boost profits
– Rewarding loyal customers
– Improving brand value through franchisees
In the third quarter, these efforts led to a 5.1% growth in global retail sales. Domino’s is on track for its 31st year of sales growth in international markets. The company’s transparency has enhanced its brand trust, leading to stronger customer loyalty.
As long as Domino’s continues its marketing and operations, it may achieve big gains for shareholders. With Warren Buffett as an investor, people will be watching to see if Domino’s becomes the newest stock-split stock in 2025. Warren Buffett usually invests in individual businesses through Berkshire Hathaway.
However, in recent years, he has also invested in ETFs. Berkshire’s portfolio now includes two ETFs that track the S&P 500: the SPDR S&P 500 ETF Trust and the S&P 500 ETF. Buffett seems to prefer the S&P 500 ETF, as Berkshire owns more of it.
He also expressed a preference for S&P 500 funds in his 2013 letter to shareholders. Buffett started investing in the S&P 500 ETF in 2019, and it has returned over 100% since then.
Buffett’s latest stock pick
However, there are concerns about future market conditions. Barry Bannister of Stifel predicted a 26% drop in the S&P 500 next year, citing high valuations and economic issues. Morgan Stanley’s Seth Carpenter also warned that proposed tariffs could harm the economy.
He suggested that tariffs might increase inflation and slow economic growth. Whether these predictions come true remains to be seen. Factors like deregulation and corporate tax cuts could support the stock market, while tariffs could have a negative impact.
For long-term investors, the good news is that the S&P 500 has historically delivered excellent returns. Buffett’s investment in the S&P 500 ETF could remain a strong bet for the long term. Warren Buffett’s Berkshire Hathaway has been selling stocks in 2024, but it still holds large positions in some companies.
Three attractive buys in December are Occidental Petroleum, Chevron, and Pool Corporation. Occidental Petroleum is Berkshire’s sixth-largest holding. The company reported strong third-quarter results, with adjusted EPS of $1.00 and a 21% increase in operating cash flow.
Occidental Petroleum is an attractive dividend stock with a 1.7% yield. Chevron is a reliable source of passive income, with 37 consecutive years of dividend raises and a 4% yield. The company has diversified beyond oil and gas and can remain profitable even if oil prices drop below $50 per barrel.
Pool Corporation is new to Berkshire’s portfolio. The company is the largest distributor of pool-related products. Despite the cyclical nature of its business, Pool Corp derives most of its sales from maintenance and replacement spending.
Management expects revenue to grow 6% to 9% annually over the long term. These three stocks offer a mix of reliable dividends and long-term growth potential, making them excellent choices for investors in December.
