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Renowned investor Warren Buffett is not known as a technology guru. His reputation comes from opportunistically buying and holding blue-chip stocks over the long term. berkshire hathawayhis holding company is worth nearly $1 trillion today.
But I would add that Berkshire Hathaway’s portfolio is quietly investing very heavily in artificial intelligence (AI). The top four AI stocks by position size are: almost half Total portfolio!
Now, take a look at Buffett’s top four AI stocks.
1. Apple
Warren Buffett isn’t afraid that successful investments will become a big part of Berkshire’s portfolio. Look no further than the iPhone manufacturer apple (NASDAQ:AAPL). Buffett first bought the stock in 2016, and it has grown to account for 44.2% of his portfolio. Nevertheless, Apple is a bona fide AI stock, and Buffett has sold minimal shares despite currently sitting on huge unrealized gains. why? Buffett praised the company’s high level of customer loyalty and quipped that people would give up their second car for an iPhone.
Technology companies, including Apple, are investing in AI and combining it with their consumer products. Apple is already implementing AI into the iOS experience for creature comforts, including Siri assistance, facial recognition, and content recommendations. However, Tim Cook recently shared at an event that Apple is prioritizing investment in generative AI. The company recently halted its electric vehicle project and plans to shift employee resources to Apple’s AI division. Let’s work together for the future.
2. Moody’s
Corporate Credit and Analytics Company Moody’s (NYSE:MCO) More similar to Buffett’s known style. Berkshire has owned Moody’s stock since 2000 and has enjoyed great investment success over the years. Moody’s is a much smaller company than Apple, although it makes up a much smaller 2.5% of Berkshire’s portfolio. Berkshire’s stock represents 13.5% of the company’s ownership.
Moody’s analyzes data to assess business credit and sells market research. For companies like Moody’s, implementing artificial intelligence is a natural progression. The company has valuable data from decades of operations and uses OpenAI and Azure to build models on that data. The evolution to more technology-driven data analysis is essential for Moody’s to maintain its excellent reputation in the financial markets. Moody’s has had his 64th consecutive quarter of increasing earnings, a testament to the company’s durability.
3. Amazon
tech giant Amazon (NASDAQ:AMZN) This is a stock that Buffett entered late. He didn’t add stocks to Berkshire’s portfolio until 2019. But the stock has more than doubled since then, showing that it’s never too late to invest in great companies. Amazon has built a reputation as an innovator. Amazon, which became America’s leading e-commerce company, has since built a major cloud platform and streaming service, and is now leaning into AI.
Like Apple, Amazon also uses generative AI in its consumer-facing business. E-commerce customers can browse products, and AI saves time by summarizing buyers’ product reviews into short summaries. On AWS, Amazon has amassed vast resources, including: Nvidia Chip and its proprietary chips to give cloud customers the tools to build AI applications. Amazon’s ability to connect AI to its business could support long-term growth in e-commerce and cloud, industries with gas left in the tank.
4. Snowflake
data cloud and analytics company snowflake (New York Stock Exchange: Snow) is unique among Buffett AI in that it is the only stock that Berkshire Hathaway has invested in since day one. The holding company participated in Snowflake’s initial public offering in 2020 and has held shares ever since. It also ranks among the smallest of the companies on this list, accounting for only 0.3% of Berkshire’s portfolio.
Snowflake could become a huge company in the age of AI. The company’s cloud platform stores and organizes data, making it easy for customers to search and integrate with third-party apps through the cloud. Additionally, Snowflake operates a data marketplace where customers can share data and purchase access to third-party datasets to combine with their own datasets.
Data is fundamentally the building block of AI, as all AI is trained on data. That makes Snowflake a potentially important player for the future of AI, and Berkshire’s early entry into this stock is notable.
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John Mackey, former CEO of Amazon subsidiary Whole Foods Market, is a member of the Motley Fool’s board of directors. Justin Pope has no position in any stocks mentioned. The Motley Fool has positions in and recommends Amazon, Apple, Berkshire Hathaway, Moody’s, Nvidia, and Snowflake. The Motley Fool has a disclosure policy.
Here are Warren Buffett’s top artificial intelligence (AI) stocks. The original article was published by The Motley Fool.
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