24/7 Insights

• Berkshire’s $332 billion very concentrated investment portfolio consists of 41 companies.
• Warren Buffett currently has a stunning $189 billion in cash and short-term T-bills.
• Access 2 legendary, high-yield dividend stocks Wall Street loves.

If any investor has stood the test of time, it’s Warren Buffett, and with good reason. For years, the “Oracle of Omaha” has had a rock-star-like presence in the investing world, and his annual Berkshire Hathaway shareholders meeting draws thousands of loyal fans who are investors. 

Buffett’s investment philosophy, encapsulated in his famous quote, “His favorite holding for an S&P 500 stock is forever,” has been a resounding success. The fact that five top companies constitute nearly 75% of the fund’s total holdings is a testament to the efficacy of this concentrated approach.

We screened the Berkshire Hathway holdings, looking for companies that are the top ideas for investors looking for total return in June. We found five that look like they could explode higher over the next month. We focused on stocks in sectors that have lagged some this year, like energy and finance.

Why do we cover Warren Buffett stocks?

There are few investors with the results and the reputation Mr. Buffett has garnered over the past 50 years, and while investing has changed over the previous half-century, buying good companies with products and services that are known worldwide while paying dividends will always stay in style.

Ally Financial

The bank with no buildings, posted solid first-quarter earnings and paid a significant 3.04% dividend. Ally Financial Inc. (NYSE: ALLY), a pioneer in the digital financial services industry, offers a diverse range of innovative digital financial products and services to consumer, commercial, and corporate customers, primarily in the United States and Canada.

It operates through four segments:

• Automotive Finance Operations
• Insurance Operations
• Mortgage Finance Operations
• Corporate Finance Operations

The Automotive Finance Operations segment offers:

• Automotive financing services, including retail installment sales contracts
• Loans and operating leases
• Term loans to dealers
• Financing dealer floor plans and other lines of credit to dealers
• Warehouse lines to automotive retailers
• Fleet financing

It also provides financing services to companies and municipalities for the purchase or lease of vehicles and vehicle remarketing services

The Insurance Operations segment offers consumer finance protection and insurance products through the automotive dealer channel, and commercial insurance products directly to dealers. This segment provides vehicle service and maintenance contracts and guaranteed asset protection products and underwrites commercial insurance coverages, which primarily insure dealers’ vehicle inventory.

The Mortgage Finance Operations segment manages a consumer mortgage loan portfolio that includes bulk purchases of jumbo and low-to-moderate income mortgage loans originated by third parties and direct-to-consumer mortgage offerings.

The Corporate Finance Operations segment provides senior secured leveraged cash flow and asset-based loans to middle market companies, leveraged loans, and commercial real estate products to serve companies in the healthcare industry.

The company also offers commercial banking products and services, securities brokerage, and investment advisory services.

Chevron

This integrated giant is a safer option for investors looking to position themselves in the energy sector. It has a sweet 4.05% dividend. Through its subsidiaries, Chevron Corp. (NYSE: CVX) engages in integrated energy and chemicals operations worldwide.

The company operates in two segments:

• Upstream 
• Downstream

The Upstream segment is involved in the following:

• Exploration, development, production, and transportation of crude oil and natural gas
• Processing, liquefaction, transportation, and regasification associated with liquefied natural gas
• Transportation of crude oil through pipelines; and transportation, storage
• Marketing of natural gas, as well as operating a gas-to-liquids plant

The Downstream segment engages in:

• Refining crude oil into petroleum products
• Marketing crude oil, refined products, and lubricants
• Manufacturing and marketing renewable fuels
• Transporting crude oil and refined products by pipeline, marine vessel, motor equipment, and rail car
• Manufacturing and marketing of commodity petrochemicals, plastics for industrial uses, and fuel and lubricant additives

It also involves cash management, debt financing, insurance operations, real estate, and technology businesses.

Chevron announced last fall that it has entered into a definitive agreement with Hess Corp. (NYSE: HES) to acquire all of the outstanding shares of Hess in an all-stock transaction valued at $53 billion, or $171 per share based on Chevron’s closing price on October 20, 2023. Under the terms of the agreement, Hess shareholders will receive 1.0250 shares of Chevron for each Hess share. The transaction’s total enterprise value, including debt, is $60 billion.

Citigroup

This is a top bank that Warren Buffett bought a massive $2.5 billion worth of stock back in the summer of 2022 that pays a dependable 3.36% dividend. Citigroup Inc. (NYSE: C) is a leading global diversified financial service company that provides consumers, corporations, and governments with a broad range of financial products and services.

Citigroup offers:

• Consumer banking and credit
• Corporate and investment banking
• Securities brokerage
• Transaction services
• Wealth management services

Citi operates and does business in more than 160 countries/jurisdictions in North America, Latin America, Asia, Europe/Middle East and Africa (EMEA).

Trading at a still cheap 9.5 times estimated 2024 earnings, this company looks very reasonable in a volatile stock market and a dramatically lagged sector.

Jefferies Financial

This broker-dealer is an excellent idea for those looking for financials besides money center banks. It pays a 2.55% dividend. Jefferies Financial Group Inc. (NYSE: JEF) engages in investment banking capital markets and asset management businesses in the Americas, Europe, the Middle East, Africa, and Asia.

The company operates in four segments:

• Investment Banking and Capital Markets
• Asset Management
• Merchant Banking
• Corporate 

It provides investment banking, advisory services concerning mergers or acquisitions, restructurings or recapitalizations, private capital advisory transactions, equity and debt underwriting, and corporate lending.

In addition, Jefferies offers:

• Financing
• Securities lending and other prime brokerage services
• Equities research and finance
• Wealth management services

In addition, it provides clients with:

• Sales and trading of investment grade corporate bonds, U.S. and European government and agency securities
• Municipal bonds, mortgage-backed and asset-backed securities
• Leveraged loans, consumer loans, high yield and distressed securities
• Emerging markets debt
• Interest rate and credit derivative products
• Foreign exchange trade execution and securitization

It also manages, invests in, and provides services to various alternative asset management platforms across investment strategies and asset classes.

Raymond James Has 5 Passive Income Dividend Stocks to Buy With Yields Up to 14%

Occidental Petroleum

Over the past two years, Berkshire Hathaway has been buying the shares in a big way, which now amounts to a massive 248,018,128 shares with a decent 1.38% dividend. Occidental Petroleum Corp. (NYSE: OXY) together with its subsidiaries, is engaged in the acquisition, exploration, and development of oil and gas properties in the United States, the Middle East, Africa, and Latin America.

It operates through three segments:

• Oil and Gas
• Chemical
• Midstream and Marketing

The company’s Oil and Gas segment explores for, develops, and produces oil and condensate, natural gas liquids (NGLs), and natural gas.

Its Chemical segment manufactures and markets basic chemicals, including:

• Chlorine
• Caustic soda
• Chlorinated organics
• Potassium chemicals
• Ethylene dichloride
• Chlorinated isocyanurates
• Sodium silicates, and calcium chloride
• Vinyls comprising vinyl chloride monomer, polyvinyl chloride, and ethylene

The Midstream and Marketing segment gathers, processes, transports, stores, purchases, and markets oil, condensate, NGLs, natural gas, carbon dioxide, and power. This segment also trades around its assets consisting of transportation and storage capacity and invests in entities.

Buffett has loaded the boat on Occidental Petroleum which pays Berkshire Hathaway a reported $897,455,953 in annual dividends. $218,255,953 from the common stock and $679,200,000 from Occidental preferred stock that yields 8%.

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