3 Bargains in Berkshire’s Portfolio
This trio of stocks in Berkshire Hathaway are undervalued according to our metrics.
Premium Article
Mentioned: General Motors Co (GM)
, RH (RH)
, The Kraft Heinz Co (KHC)
, Berkshire Hathaway Inc (BRK.A)
, DaVita Inc (DVA)
, Occidental Petroleum Corp (OXY)
, Berkshire Hathaway Inc (BRK.B)
Last week, Berkshire Hathaway (BRK.A) (BRK.B) filed its third-quarter 13-F. As Morningstar's sector strategist (and resident Berkshire specialist) Gregg Warren noted, Occidental Petroleum (OXY) dominated the equity purchase activity during the quarter, and Berkshire's pickup of luxury retailer Restoration Hardware (RH) made headlines.
However, neither of these stocks is trading in buying range today by our measures: Occidental is trading at 3-star levels, suggesting shares are fairly valued when adjusted for their uncertainty risk; RH is a 2-star stock, which means it's overvalued today. In fact, most of the companies Berkshire owns are fairly to slightly overvalued. It's no wonder: If Warren Buffett and his managers like these stocks, other investors inevitably will, too.
Susan Dziubinski does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.