Warren Buffett is doing it again. Berkshire Hathaway has trounced the returns of the S&P 500 index since Buffett took control of the company in 1965. Buffett continues to beat the market this year with Berkshire's shares up two times higher than that of the S&P.
Some of Berkshire's strong gains can be attributed to high-flying stocks in its investment portfolio. Here are Buffett's three best-performing stocks so far in 2024.
1. Mitsubishi
Buffett listed Mitsubishi (MSBHF 0.73%) among the investments he expects Berkshire to "maintain indefinitely." That could be a smart decision. Shares of the Japanese conglomerate have skyrocketed over 40% this year.
Mitsubishi's business spans a wide range of industries. It runs hundreds of companies that produce natural gas, manufacture chemicals, mine natural resources, operate convenience stores, and more.
Berkshire owns stakes of roughly 9% in five Japanese trading companies. Mitsubishi is the biggest of the group. Buffett likes these companies because of their diversification, policies that reward shareholders (in particular, paying dividends and shrewd stock buybacks), and solid management teams.
2. Nu Holdings
It's likely that one of Berkshire's two investment managers, Todd Combs or Ted Weschler, bought shares of Nu Holdings (NU -1.75%) rather than Buffett himself. However, when Berkshire owns a stake in a company, Buffett owns a stake too. And the legendary investor is probably happy about his position in Nu right now with the fintech stock up over 30% year to date.
Nu operates a digital financial services platform that serves nearly 94 million customers in Brazil, Colombia, and Mexico. It ranks as the fifth-largest financial services company in Latin America based on number of customers.
In the fourth quarter of 2023, Nu's revenue jumped 57% year over year on a constant-currency basis to a record-high $2.4 billion. Its adjusted profits soared nearly 250% to $395.8 million. The company is especially strong in Brazil, where 53% of the country's population uses its platform.
3. DaVita
Buffett first initiated a position in DaVita (DVA 1.54%) in 2011. Today, Berkshire owns over 41% of the company. DaVita has been a big winner for Buffett so far in 2024 with its shares vaulting nearly 28% higher.
DaVita is one of the largest kidney dialysis service providers in the U.S. The company operates 2,675 outpatient dialysis centers in the U.S. plus 367 centers in 11 other countries. DaVita's stable business model fits well with Buffett's investment philosophy.
The COVID-19 pandemic presented big challenges for DaVita. However, the company appears to be in good shape now. DaVita should soon significantly expand its international business through acquisitions that will make it the biggest dialysis services provider in Latin America.
Are these top-performing Buffett stocks buys now?
I think these high-flying Buffett stocks are good picks for investors now -- but for different kinds of investors.
Growth investors should like Nu; the company has excellent opportunities for sustained growth in Latin America. Income investors will probably like the stability of Mitsubishi's dividend, which currently yields a little over 2%. DaVita could appeal to value investors with its forward price-to-earnings multiple of only 14.6.
