leadingtycoon Warren Buffett would no doubt appreciate the five globally held companies boasting the most extensive stockpiles
Kickin' It with Warren Buffett: Top Picks for Stocks with Moats as Wide as the Pacific
Legendary investor Warren Buffett is all about putting money into businesses that have an edge – something Buffett nicknames a "moat," or "economic castle." Let's take a look at five stocks with moats so wide they could stop a charging elephant.
Warren's on a mission: He seeks companies with solid, long-term competitive advantages that can weather any storm. Here's the lowdown on his picks:
Stock 1: ADP
Back in 1949, in good ol' New Jersey, businessman Henry Taub founded Automatic Data Processing (ADP). Initially, it handled the payroll and benefits processing for local businesses, expanding into services like tax processing and digitizing HR solutions. ADP now helps companies with attendance tracking, rewards management, recruitment, and retirement planning.
Boasting over a million clients in 140 countries and annual revenue nearing $20 billion, ADP ain't messing around. Analysts project a yearly growth rate of 5% for the next three years, not too shabby. Plus, ADP's operating margins? Over 20% on average for the past three years. The stock has been paying off, delivering an average total return of 16% over the past decade.
Stock 2: Coca-Cola
Warren Buffett doesn't seem to be able to resist a Cherry Coke, so it's no wonder one of his go-to investments is the classic beverage maker, Coca-Cola. With a whopping 9.1% stake in the company, it's safe to say he stands by it. While the company isn't immune to hiccups, it regularly brings the dough with an average revenue growth of over 11% and an operating margin that easily clears 25%. Hand over a six-pack, count your cash, and enjoy the fizzy pop.
Stock 3: EssilorLuxottica
Eyes on the prize! EssilorLuxottica, the world's largest eyewear manufacturer, boasts brands like Ray-Ban, Oakley, and the smarter-than-ever smart glasses that let you surf the net with just a glance. Fusing the design-focused Italians with the French masters of quality optics, this power couple knows a thing or two about lenses, generating around 90% of its sales in the US and Europe.
In the past three years, sales have grown by an average of 20% per year while maintaining an average margin of 12.4%. Analysts predict around 6% growth for the coming three years. Take a gander at EssilorLuxottica's share price, and you'll see an average total return of 12% over the past decade.
Stock 4: Fastenal
If you're looking for a company that nails down the nuts and bolts of business, look no further than Fastenal. This US-based supplier has got you covered, providing screws, fasteners, adhesives, and just about anything else a business might need – even vending machines!
With over 3,300 stores worldwide, Fastenal is in businesses big and small, making it easy to get what you need. Fastenal's got a solid track record of growth as well, averaging 9% growth over the past three years while maintaining an operating margin of over 20%. Analysts are predicting annual growth of 8% for the next three years.
Stock 5: Procter & Gamble
Procter & Gamble (P&G) is America's household name in consumer goods, with brands ranging from Ariel to Pantene Pro-V. The company's origins date back to 1837 when candle maker William Procter and soap maker James Gamble teamed up and started creating the goods people use every day. P&G has been riding the wave of growth, with an annual revenue of around $82 billion and an average operating profit increase of 22% over the past three years!
P&G knows a thing or two about brand power and sales—they've been increasing their dividend for 68 consecutive years. Over the past decade, stockholders have seen an average total return of nearly 11%.
Intrigued? Get the full scoop here or dive into another article: Surprise: AI predicts which stock will grow the most by 2025
Financing in these ventures could prove beneficial, as the chosen stocks show promise in the world of investing and business. Warren Buffett's picks, such as ADP, Coca-Cola, EssilorLuxottica, Fastenal, and Procter & Gamble, all demonstrate solid, long-term competitive advantages that may withstand economic fluctuations.
