When it comes to investing, copying someone else’s portfolio blindly is generally not recommended. Every investor has a unique style, risk tolerance, and financial goals. However, drawing inspiration from successful investors can be a smart move. Two billionaires, Warren Buffett and Cathie Wood, are often looked up to for investment ideas. If you’re seeking stocks owned by these investing giants to diversify your portfolio, here are three compelling options tied to Buffett’s Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B) or Wood’s ARK Invest.
Visa: A Steady Blue-Chip Performer
Despite representing a small slice of Berkshire Hathaway’s portfolio, Visa stands out as a reliable blue-chip stock in their lineup. Visa’s strength lies in its extensive global network with over 4.3 billion cards in circulation and acceptance by more than 130 million merchants worldwide, surpassing even Mastercard.
Operating with consistently high margins around 80%, Visa benefits from a significant network effect. Merchants prefer Visa due to its widespread usage, while consumers opt for Visa knowing it is widely accepted. This symbiotic relationship boosts Visa’s market dominance and profitability, setting it apart in the payment processing industry.
Meta Platforms: A Value Play with Potential
Meta Platforms, part of Wood’s coveted ARK Innovation ETF and a key player in the “Magnificent Seven,” emerges as a compelling value pick within this distinguished group of companies. Despite a 130% surge in the past year, Meta has faced challenges like public relations issues and a temporary advertising slowdown, impacting its revenue heavily.
Benefiting from its extensive reach and network effect, Meta serves as a top choice for advertisers aiming to reach a vast consumer base across platforms like Facebook, Instagram, WhatsApp, and Messenger. The recent introduction of dividends, though modest at $0.50 per share, signals a positive direction for investors seeking long-term growth.
DraftKings: Riding the Wave of Sports Betting Expansion
DraftKings, another holding in Wood’s ARK Innovation ETF, is a prominent player in the sports betting landscape with significant growth potential as the industry expands. With 38 states and Washington, D.C. now allowing sports betting in some form, DraftKings is well-positioned to capitalize on the mainstream acceptance of online sports betting.
Having grown its user base exponentially from 1.7 million to 7.1 million in just five years, DraftKings dominates the U.S. online sports betting and iGaming market. With global online sports betting revenues projected to soar from $43 billion in 2023 to over $65.6 billion by 2029, DraftKings’s strategic focus on market share positions it for sustained growth.
Is Visa a Wise Investment?
Before diving into Visa stock, it’s essential to consider other opportunities. The Motley Fool Stock Advisor recently identified the top 10 stocks with potential for substantial returns in the foreseeable future, excluding Visa from its list.
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Randi Zuckerberg, former Facebook market development director and sister to Meta Platforms CEO Mark Zuckerberg, serves on The Motley Fool’s board. Stefon Walters holds positions in Apple, DraftKings, and McDonald’s. The Motley Fool has stakes in and endorse Apple, Berkshire Hathaway, Mastercard, Meta Platforms, Visa, and Walmart. Disclosure: The Motley Fool follows a strict disclosure policy.
The opinions and views expressed here are those of the author’s and do not necessarily reflect the viewpoints of Nasdaq, Inc.
