Warren Buffett invests $25 billion in two stocks and predicts growth of 37% and 14% in 2024, says Wall Street

If you want your investment portfolio to perform as well as Warren Buffett’s, the key is to hold stocks for a long time, just like he does. When asked how long he thinks people should hold the stock in Berkshire Hathaway’s (NYSE: BRK.A)(NYSE: BRK.B) portfolio, Buffett confidently answers “forever.”

The price you pay for a stock is important, no matter how long you hold it. To invest like Buffett, you need to buy stocks at the right time.

Now might be a good time to consider two of Buffett’s stocks. Recently, $24.6 billion of Berkshire’s portfolio went into two companies that Wall Street believes could grow 37% and 14% next year, according to Citi analysts.

1. Amazon:

Buffett sold some of Berkshire’s Amazon (NASDAQ:AMZN) shares in the third quarter, but kept $10 million. Citi analyst Ronald Josey thinks Buffett should have kept them all. Even though Amazon stock is up 83% this year, Josey believes it could rise even higher. He raised his price target to $210, suggesting a 37% gain over the next 12 months.

Josey likes Amazon’s strong position in U.S. e-commerce. Other companies that sell on Amazon maintain it, which generates more advertising sales. Amazon Web Services (AWS), its cloud service, also performed well, with third-quarter revenue increasing 12% to $23 billion. The global cloud services market is expected to grow by 14.1% each year until 2030.

2. Coca-Cola:

Coca-Cola (NYSE: KO) is now Berkshire Hathaway’s fourth largest holding, with more than $23 billion invested. Coca-Cola shares fell about 8% in 2023, but Citi analyst Filippo Falorni thinks they will rise in 2024. He raised his price target to $67 per share, suggesting a 14% gain over the next 12 months. The main attraction is Coca-Cola’s growing dividend payments, which have increased for 61 consecutive years.

Berkshire owns 400 million shares of Coca-Cola and expects more than $736 million in dividends in 2024 if they maintain their streak.

Concerns about popular weight control drugs affecting soft drink sales have put pressure on Coca-Cola shares. However, the fear seems exaggerated, as sales in North America remained stable in the third quarter.

Analysis:

While Amazon offers the opportunity for big profits with its strong e-commerce and cloud services, its stock is already expensive, trading at 94 times free cash flow. If earnings don’t grow quickly in the coming years, the stock could fall. If you’re not comfortable with high stakes, it’s probably safer to watch from a distance.

Coca-Cola, with its well-known brands, can overcome the trend of fewer and fewer people drinking sugary soft drinks. Despite the concerns, third-quarter revenue increased 11% year over year. With a 3.1% yield and potentially higher dividends, Coca-Cola is a good option for most investors to add to their portfolios in 2024 and hold for the long term.