Warren Buffett’s Top Stock Picks for 2025: Insights from Berkshire Hathaway’s Strategy

It’s been a landmark year for Wall Street, with billionaire Warren Buffett leading the charge. As of November 27, shares of Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B) have soared by 33.4%, marking its best annual return since 1998.

The Oracle of Omaha’s consistent success compared to the benchmark S&P 500 over nearly six decades has made his investment moves a focal point for many investors seeking to replicate his success. Quarterly filed Form 13Fs with the Securities and Exchange Commission make it simple to follow Buffett’s trades.

Berkshire Hathaway CEO Warren Buffett. Image source: The Motley Fool.

Interestingly, in the past eight quarters, Buffett has been a notable net seller of stocks, with a staggering $166 billion in sales. As a staunch value investor, he has found limited opportunities in what is historically one of the most expensive stock markets, stretching back to the early 1870s. However, it’s worth noting that Buffett has identified three key stocks he is eager to own as 2025 approaches.

1. Domino’s Pizza

During the third quarter, Berkshire’s chief notably did not buy shares of his favorite stock, Berkshire Hathaway. Instead, he concentrated on the fast-food chain Domino’s Pizza (NYSE: DPZ).

Warren Buffett well understands consumer behavior; even in tough economic times, people will always need to eat. Domino’s targets budget-conscious consumers and offers food and beverages that remain in demand regardless of economic conditions.

Buffett appreciates the trust Domino’s has cultivated with consumers. About 15 years ago, the company admitted its pizza needed improvement, initiating a successful turnaround through transparency and product innovation. Their latest five-year plan, “Hungry for MORE,” emphasizes new menu items and technology to enhance service quality.

Despite its ongoing sales growth—on track for 31 consecutive years of international same-store sales increases—Domino’s carries a forward price-to-earnings ratio (P/E) of 27, which may be concerning given the comparatively modest sales growth in a pricey market.

Image source: Getty Images.

2. Occidental Petroleum

Another stock Buffett is keen on is the oil and gas giant Occidental Petroleum (NYSE: OXY). Since early 2022, Berkshire has amassed over 255.2 million shares in this company.

Buffett’s significant investment—now close to $13 billion—signals his belief that crude oil prices will remain strong or increase. The energy industry faces pressure due to past under-investment during the pandemic, leading to tighter oil supply. Recent geopolitical tensions, such as Russia’s invasion of Ukraine, further affect global energy dynamics.

Occidental is particularly tied to its drilling operations, making it sensitive to crude oil price fluctuations. As such, a potential recession could significantly impact the company, as its cash flow heavily relies on oil extraction activities.

3. Chubb

Lastly, Buffett has shown strong interest in the property and casualty insurer Chubb (NYSE: CB). Chubb’s stock received “confidential treatment” in Berkshire’s 13Fs until their first-quarter trading activity was revealed on May 15.

Buffett has a well-known affinity for financial stocks. While these investments can be affected by economic cycles, periods of growth typically outlive recessions. Long-term investors who choose established, leading financial firms often see positive returns.

Insurance companies generally enjoy solid pricing power, allowing them to raise premiums in response to catastrophic events or even minor claims. This resilience makes insurers, like Chubb, a reliable choice in complicated economic landscapes.