Warren Buffett, also known as the Oracle of Omaha, is one of the most successful and renowned investors of all time. He is also the world’s seventh-richest person. Buffett follows the Benjamin Graham school of value investing, which involves picking stocks trading below intrinsic value.
Warren Buffett is the Chairman and CEO of Berkshire Hathaway (BRK.A) (BRK.B), a multinational holding company that majorly owns shares of blue-chip companies with robust balance sheets and stable cash flows. BRK.B has gained 2.7% over the past nine months.
Amid the market bloodbath and volatility over the past few months, Warren Buffett’s portfolio could be a guide to many. Here are two stocks, UnitedHealth Group Incorporated (UNH) and Anheuser-Busch InBev SA/NV (BUD), which fit his investing criteria and could be worth buying now.
UnitedHealth Group Incorporated (UNH)
UNH operates as a diversified healthcare company in the United States through four segments, UnitedHealthcare; OptumHealth; OptumInsight; and OptumRx.
On July 15, UNH announced the elimination of out-of-pocket costs for certain insulins and drugs used to treat emergency cases. This company aims to make prescription drugs more accessible and affordable to patients.
For the fiscal second quarter ended June 30, UNH’s total revenues increased 12.6% year-over-year to $80.33 billion. Its earnings from operations grew 19.3% from the year-ago value to $7.13 billion, while its net earnings stood at $5.20 billion, reflecting an 18.9% increase year-over-year. The company’s EPS came in at $5.34, reflecting an increase of 19.7% year-over-year.
The consensus EPS estimate of $5.46 for the fiscal quarter ending September 2022 represents a 20.7% improvement year-over-year. The consensus revenue estimate of $80.51 billion for the same quarter represents an 11.3% increase from the same period last year. It has an impressive earnings surprise history, as it topped Street EPS estimates in each of the trailing four quarters.
Over the past year, the stock has gained 24.8% to close the last trading session at $524.
UNH’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall rating of A, translating to Strong Buy in our POWR Ratings system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
UNH also has an A grade in Sentiment and a B in Growth, Quality, and Stability. It is ranked #2 of 11 stocks in the A-rated Medical – Health Insurance industry.
Beyond what is stated above, we’ve also rated UNH for Momentum and Value. Get all UNH ratings here.
Anheuser-Busch InBev SA/NV (BUD)
Headquartered in Leuven, Belgium, BUD produces, distributes, and sells beer, alcoholic beverages, and soft drinks worldwide.
BUD’s revenue increased 11.3% year-over-year to $14.79 billion in the fiscal second quarter of 2022. Its gross profit grew 4.9% from the year-ago value to $7.99 billion, while its EBITDA increased 7.2% from its year-ago value to $5.10 billion. Also, the company’s EPS came in at $0.93, up 17.7% from the prior-year quarter.
Street expects BUD’s EPS for the fiscal third quarter ending September 2022 to improve 73.5% year-over-year to $0.87. The consensus revenue estimate of $15.17 billion for the same period represents a 6.3% increase year-over-year.
BUD has slumped 9.7% over the past month to close the last trading session at $47.98.
The company has an overall rating of B, translating to Buy in our proprietary rating system. BUD is also rated B in Stability and Sentiment. Within the A-rated Beverages industry, it is ranked #13 of 34 stocks.
Click here for additional POWR Ratings for Quality, Momentum, Value, and Growth for BUD.
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UNH shares were trading at $526.19 per share on Friday afternoon, up $2.19 (+0.42%). Year-to-date, UNH has gained 5.47%, versus a -14.96% rise in the benchmark S&P 500 index during the same period.
About the Author: Komal Bhattar
Komal's passion for the stock market and financial analysis led her to pursue investment research as a career. Her fundamental approach to analyzing stocks helps investors identify the best investment opportunities. More...
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