Warren Buffett’s Secret Weapon Stock Is Obliterating Nvidia in 2025

The Oracle of Omaha's quiet contender just left tech's golden child in the dust.

Buffett's Unlikely Champion

While Nvidia grabs headlines, this legacy pick quietly racks up triple-digit gains. The numbers don't lie—it's outperforming by a country mile.

Steady Wins the Race

No AI hype, no metaverse promises—just old-school value crushing flashy tech. Turns out fundamentals still matter in an era of speculative mania.

Wall Street analysts are scrambling to explain how a 'boring' stock became 2025's top performer. Maybe Buffett still knows a thing or two about actual investing.

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The internet monopoly in Berkshire's portfolio

While Buffett typically stays away from tech stocks, he has made a few exceptions on occasion. Berkshire has long owned shares of(AAPL -0.70%), which remains its largest holding in its marketable equities portfolio. That's despite the fact that Buffett has trimmed about 70% of its shares.

What Buffett likes about Apple is that it makes a consumer product that's relatively easy to understand, even if you don't understand all the technology that goes into it. Apple's strength is in its user experience and brand loyalty, and it doesn't require advanced engineering knowledge to understand those competitive advantages.

Another longtime Buffett favorite in the tech space with an easy-to-understand competitive advantage is(VRSN 1.38%). VeriSign owns the exclusive rights to register domain names with .com or .net. In other words, it has a monopoly over the most popular top-level domains, and that's not going to change anytime soon.

The one thing keeping its monopoly in check is its contract with the Internet Corporation for Assigned Names and Numbers, or ICANN. It's limited in how quickly it can raise the price it charges for new domain names and renewals. The only thing it has to do to maintain its exclusive rights is operate critical internet infrastructure and provide uninterrupted domain name system (DNS) services.

As a result, VeriSign can produce wider profit margins every year as it raises prices. And while competing top-level domains have entered the market, every serious business wants a .com or .net domain. That ensures it maintains a high level of renewals and a growing number of customers over time.

VeriSign works closely with registrars to grow its customer base. After some disappointing results over the last few years, it shifted strategies to push registrars to focus on offering better pricing and attracting long-term customers. The strategy has paid off with strong net increases in domain registrations in the first half of 2025. That's somewhat offset by an increase in marketing expenses.

The improvement hasn't gone unnoticed by the market. As mentioned, the stock has climbed more than 38% in 2025, outpacing Nvidia. And management is optimistic about the rest of 2025 as well.

Is the stock a buy?

VeriSign's financials are set up for slow and steady growth for the foreseeable future. It can raise the rates it charges for domain names in most years, according to its ICANN contract. Meanwhile, the capital expenditures and ongoing operating expenses required to keep up its end of the contract are relatively small compared to its revenue base. It has shown the ability to leverage marketing spend to grow its customer base, which should result in high customer lifetime value.

But after climbing 38% so far this year, the stock looks a bit expensive. Buffett might agree. He sold about $1.2 billion worth of the stock earlier this summer at the current price. That said, price wasn't the only reason Buffett sold the stock. The stock sale also put Berkshire below a 10% stake in the company, which reduces its regulatory filing requirements. Additionally, Berkshire agreed to hold its remaining stake in VeriSign for at least one year from the sale.

At a price around $285 per share, VeriSign trades for 32 times forward earnings estimates. That's a high price to pay, even for a company that has a monopoly. While its earnings growth should remain relatively steady, it's not going to climb so fast that it can justify that earnings multiple. Despite the actual business sitting on a solid footing, the stock looks risky right now due to the potential for multiple compressions weighing on the stock price. Investors should wait for the multiple to fall back toward the mid-20s, where Buffett last bought shares of the stock at the start of the year.