Warren Buffett’s Portfolio: 2 Must-Buy Stocks Now and 1 Toxic Asset to Dump
Buffett's golden touch isn't foolproof—here's where to place your bets (and what to burn).
The no-brainer buys:
Two Berkshire holdings defy market gravity—undervalued cash printers with fortress balance sheets. These aren't meme stocks; they're war chests.
The ticking time bomb:
One 'Buffett pick' reeks of legacy baggage—a dinosaur pretending it's AI-ready. Even Oracle of Omaha gets nostalgia plays wrong sometimes.
Pro tip: If a stock needs 10 PowerPoint slides to explain its 'moat,' it's already drowning. Now go deploy that capital—before the suits on Wall Street 'discover' these picks and ruin everything.
Image source: The Motley Fool.
Stock to buy: DaVita
(DVA -0.22%) is a healthcare company that focuses on kidney disease and chronic kidney failure. In addition to providing care, DaVita has a clinical research division that is focused on conducting clinical trials to create new drugs and medical devices to help patients manage their diseases.
The National Kidney Foundation estimates that 14% of U.S. adults, or about 35.5 million people, have kidney disease, with many of those cases undiagnosed. In all, an estimated one-third of adults in the U.S. are at risk. While those are grim statistics, it also speaks to the need for companies like DaVita, as well as the huge opportunity that the stock creates for long-term investors.
While DaVita stock makes up only 1.3% of Berkshire's overall portfolio, the conglomerate has a whopping 45% stake in the company. You can be sure that Buffett's team keeps a close eye on DaVita.
DaVita stock is down 10% so far this year, but the stock sells at a low price-to-earnings ratio of 13, suggesting that it is a solid value play.
Stock to buy: BYD Company
Chinese electric vehicle (EV) company(BYDDY -3.69%) is my favorite play right now in EV stocks. While there are many manufacturers battling for supremacy in the U.S., the domestic market isn't a great place for EV stocks right now – consider thatis struggling thanks to Elon Musk's diminished popularity and the TRUMP administration's rollback of tax credits that made buying EVs more affordable.
Meanwhile, the EV market in China is booming. More than 11 million EVs were sold last year in China, while just 6 million were sold in the rest of the world. And BYD has the dominant market share in China, which has fully embraced EV technology. The Chinese government spent an estimated $231 billion to develop EV technology and nudged BYD from its previous focus on making smartphone batteries to making vehicles.
BYD sold 344,296 vehicles in July, up slightly from 342,383 on a year-over-year basis. But when you look at year-to-date numbers, BYD's sales of 2.49 million units are up 27.3% from a year ago.
BYD is facing some stiff competition fromand, both of which are seeing market share increase. But BYD has a powerful moat and the top position in China, which is why Buffett and Berkshire Hathaway favor it.
Stock to sell: Lennar Corporation
While I don't have anything against(LEN -0.34%) in particular, I'm not a fan of homebuying stocks right now. Mortgage interest rates remain high, and the housing market is struggling. And that shows in Lennar's recent performance. Revenue in the second quarter fell 7% to $7.8 billion. Lennar said it saw a 9% drop in average sale prices from a year ago, falling to $389,000. Gross margins also narrowed from 22.6% in Q2 2024 to 17.8% in Q2 2025.
Lennar is projecting sale prices to fall to between $380,000 and $385,000 in the third quarter, and Chief Executive Officer Stuart Miller says the company "continues to see softness in the housing market due to affordability challenges and a decline in consumer confidence."
There are far better stocks to choose from in the Berkshire portfolio. I'm staying away from Lennar for now.
