Do you think Warren Buffett might have scooped up shares of some stocks as the market dropped in October? It’s a pretty good bet that he did. After all, we’re talking about the man who once advised investors to “be fearful when others are greedy and greedy when others are fearful.”
While investors’ fears appear to be settling down, there are still plenty of great stocks to be found. Three Warren Buffett stocks that look like great picks to buy in November are Apple (NASDAQ:AAPL), Mastercard (NYSE:MA), and Markel (NYSE:MKL).
Don’t think for a second that Warren Buffett worried about Apple’s guidance indicating that revenue growth will slow in the next quarter. The legendary investor stated in a CNBC interview in August that he doesn’t like guidance anyway, because he’s “seen it lead to a lot of bad things.”
Buffett is more focused on what really matters for Apple — the enduring power of its brand and its massive ecosystem of products and services. Investors who aren’t worth billions of dollars would be wise to focus on those things, too.
Apple CEO Tim Cook said in the company’s latest earnings release that “we enter the holiday season with our strongest lineup of products and services ever.” Cook’s optimism is arguably on target. Despite Wall Street’s gloom over Apple’s forecast for the quarter ending in December, the company is set to generate at least $90 billion in sales and probably greater than $21 billion in profit.
Over the long run, Apple should continue to deliver solid returns for investors. Regular upgrades for its iPhone, iPad, and Mac products will keep bringing customers back for more. New innovations in wearables, home appliances, and augmented reality and virtual reality should propel Apple’s growth for years to come.
Berkshire doesn’t own nearly as much Mastercard stock as it does Apple stock. But the giant payment processor looks like an attractive choice for Buffett to pick up more shares of.
Mastercard’s advantages were clearly on display in the company’s third-quarter financial results. The company posted strong year-over-year revenue and earnings growth. Mastercard performed especially well in international markets despite headwinds from currency fluctuations.
CEO Ajay Banga summed up the case for Mastercard by saying in the company’s Q3 earnings release, “Our business wins and new partnerships, strengthened by our differentiated services offerings, are helping drive our global momentum.” Perhaps the most important part of Banga’s statement is his emphasis on Mastercard’s “differentiated services offerings.”
Mastercard bundles its core payment infrastructure with security features, data analytics, loyalty-point management, and other products and services. This differentiation helps the company attract new customers and retain existing ones.
There’s a payment-processing revolution of sorts underway right now, with the world moving to cashless financial transactions. Mastercard is one of the top leaders in this revolution.
Now for a twist. Buffett’s Berkshire Hathaway doesn’t own any shares of Markel. Nada. So why does Markel make this list of top Buffett stocks to buy in November? It could be the poster child for exactly the kind of stock that Buffett likes.
In many respects, Markel is a mini-Berkshire. It’s a holding company that focuses primarily on insurance and reinsurance, but also owns other businesses and stocks of other companies. That sounds a lot like Berkshire.
Markel co-CEO Tom Gayner even sounds similar to Warren Buffett. Gayner told The Motley Fool’s Matt Koppenheffer a few years ago that he liked to buy companies and stocks of companies “that remain relevant, and that have good businesses, and that their customer bases can expand over time, and you can own them for a long time.”
Because of Markel’s specialty insurance and reinsurance businesses, the company can feel the brunt of catastrophes such as hurricanes and typhoons. But even with an underwriting loss in the latest quarter resulting from Hurricane Florence and Typhoon Jebi, Markel still turned in a solid performance.
Like Buffett, Markel owns positions in Apple and Mastercard. Markel’s biggest holding isn’t either of these stocks, though. What is Markel’s top stock? Berkshire Hathaway.
Remember the Oracle’s sayings
It could be tempting to avoid buying stocks altogether with the market’s unsettling gyrations. But remember what the Oracle of Omaha once said: “Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble.” The October pullback has given investors a great opportunity to buy great stocks like Apple, Mastercard, and Markel.
Keith Speights owns shares of Apple. The Motley Fool owns shares of and recommends Apple, Markel, and Mastercard. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool recommends Berkshire Hathaway (B shares). The Motley Fool has a disclosure policy.