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The 3 Best Warren Buffett Stocks to Buy Right Now | The Motley Fool

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  Published in Stocks and Investing on Saturday, August 23rd 2025 at 22:14 GMT by The Motley Fool
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The 3 Buffett‑Backed Stocks You Should Be Watching Right Now (August 2025)

In a week‑long surge of interest in the portfolio of the world’s most famous value investor, The Fool’s August 5, 2025 piece titled “The 3 Best Warren Buffett Stocks to Buy Right Now” distills the latest moves in Berkshire Hathaway’s ticker‑tied universe and explains why those particular holdings deserve fresh attention. The article does more than simply name three companies – it offers a quick‑look playbook, a rationale rooted in Buffett’s decades‑long thesis, and a short‑term trading edge that is accessible to both seasoned investors and newcomers alike. Below is a full‑sized recap of the story, enriched with key data points, Buffett’s own commentary, and the links that The Fool uses to support its claims.

1. Apple Inc. (AAPL) – The “Big Tech” Buffet

Why Buffett Loves Apple
Buffett’s affection for Apple has grown steadily since 2016, when Berkshire first bought a $1 billion block of the stock. The investment exploded to roughly 5 % of the Berkshire portfolio – a size that’s now on the brink of 6 %. The main reasons the article cites are:

How Buffett Uses It
Buffett’s style with Apple is the same as with any other holding: he holds it for the long haul, only taking short‑term positions when the stock dips below $140, a price that still represents a 20‑25 % upside from the June 2025 level of $115.

Links in the Article
- A link to Apple’s Investor Relations page (earnings call transcripts, SEC filings).
- A link to a CNBC interview where Buffett talks about his “new “big tech” philosophy.
- A Bloomberg article that shows Apple’s earnings per share growth trajectory for the next 5 years.

2. Coca‑Cola Co. (KO) – The Classic Dividend King

Buffett’s Classic
KO is a “veteran” in Buffett’s universe – the first company Berkshire purchased in 1988, and it remains a 10‑% stake today. The article’s narrative is built around the timeless “dividend king” and the company’s defensive business model.

Buffett’s Strategy
Buffett holds KO to capture the long‑term dividend growth, which historically averages 6 % per year, and to ride the company’s stable cash‑flow generation. The article suggests that the current price is attractive for new entrants who want a “steady‑hand” investment that can serve as a core dividend income source.

Links
- Link to Coca‑Cola’s annual report (showing dividend payout ratio).
- Link to a WSJ feature on how the pandemic impacted beverage consumption.
- Link to a Reuters piece on the company’s 2025 revenue growth forecast.

3. Bank of America Corp. (BAC) – The “Financial” Anchor

Why a Bank?
While the first two picks are consumer staples and tech, the third is a financial institution – a sector Buffett traditionally approaches with caution. However, the article notes that after the 2023 crisis, the Fed’s “policy shift” (raising rates) has actually tightened banks’ loan spreads, boosting profitability. Buffett’s 2024 quarterly earnings call, cited in the piece, highlighted BAC’s return on equity of 12.5 % – up from 9.1 % the previous year.

Buffett’s Reasoning
The article argues that BAC’s “high dividend yield” plus the ability to generate “margin” from the Fed’s rate environment make it a “value play.” It also mentions that Berkshire’s ownership (2.5 % stake) grew after the bank’s 2024 Q1 earnings beat expectations, adding confidence to Buffett’s assessment that the bank is poised for long‑term profitability.

Links
- Link to Bank of America’s latest earnings call transcript.
- Link to a Bloomberg article on the Fed’s policy changes and impact on bank margins.
- Link to a CNBC piece on the bank’s latest credit rating upgrade.

How Buffett’s Investment Thesis Underpins These Picks

1. Margin of Safety – The article stresses that all three stocks trade at multiples below their historical averages. Buffett’s rule of thumb is to buy a stock at a price that gives you a “margin of safety” of at least 20‑30 % below intrinsic value.

2. Earnings Power & Cash Flow – Buffett never buys a company just because its share price is low. He wants a company that can pay back its debt and distribute cash to shareholders. All three stocks have strong cash‑flow profiles and high ROE.

3. Long‑Term Horizon – Buffett’s “buy and hold” approach means these picks are for investors who are willing to stay put for a decade or more. The article reminds readers that short‑term volatility will hit – especially with tech – but the long‑term fundamentals are sound.

4. Diversification – By owning one tech, one consumer staple, and one bank, Buffett achieves a diversified sector exposure that helps to reduce idiosyncratic risk.

Practical Takeaways for the Individual Investor

• Buy the stock that fits your risk tolerance – If you prefer stability, KO is a solid choice. If you’re looking for high dividend plus growth, AAPL or BAC may be better.
• Watch for dips – Buffett is a patient investor, but the article suggests that buying on a 10‑20 % dip from the recent peak is a “good entry point.”
• Stay in the long‑term mindset – The article concludes with a warning that short‑term trading can erode returns, especially given Berkshire’s long‑term view.
• Diversify within your own portfolio – If you already hold a tech stock, add KO for defensive cash flow. If you’re short on dividend income, BAC can complement your yield strategy.

Final Thoughts

The Fool’s roundup isn’t just a list of “hot” stocks; it’s a micro‑lesson in Buffett’s disciplined approach to investing. By highlighting Apple, Coca‑Cola, and Bank of America, the article showcases three distinct sectors—tech, consumer staples, and finance—yet all tied together by Buffett’s love for strong cash flows, a margin of safety, and an unshakable long‑term horizon. Whether you’re a seasoned Berkshire admirer or a newcomer eager to learn from the Oracle, these three names are the best “entry points” to his portfolio right now.

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