Warren Buffett Shares: Two Giant Berkshire Holdings Soared This Week — But even so Apple

Top Warren Buffett stocks Kraft Heinz (KHC) and Coca-Cola (KO) soared on earnings beats this week, with the consumer staples giants benefiting from price hikes.


Defying investor worries about inflation’s impact on shoppers, the consumer staples giants signaled strong demand for now. Meanwhile, price hikes to manage rising supply-chain and commodity costs helped both companies, offsetting a strong dollar.

“In the face of these pressures, consumers stayed resilient,” Coca-Cola CEO James Quincey said on an earnings call with investors.

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Both KHC stock and KO stock are among the top 5 stocks by number of shares in the Berkshire Hathaway (BRKB) investment portfolio. Both are also among the top 10 stocks in the portfolio by market value, with Apple (AAPL) at No. 1.

For the September quarter, Coca-Cola earned 69 cents per share on revenue of $11.063 billion, the company said on Oct. 25. Year over year, Cola-Cola earnings rose 7% and sales grew 10%. Both beat estimates.

For the third quarter, Kraft Heinz earned 63 cents per share on revenue of $6.505 billion, the company reported Oct. 26. On a year-over-basis, Kraft Heinz earnings fell 3% while revenue rebounded 4%. Both also beat estimates.

Despite currency, inflationary and macro headwinds, Kraft Heinz affirmed 2022 sales guidance of high-single-digit growth and raised the lower end of its full-year earnings guidance.

Coca-Cola hiked its forecast for revenue and profit growth this year and said it is “encouraged by the underlying top-line momentum” for 2023.

Analysts expect Kraft Heinz to return to annual EPS growth in 2023 after a decline this year, but still below the 2021 level. Some investors think the Kraft Heinz turnaround is gaining momentum roughly seven years after food giants Kraft and Heinz merged.

KO Stock, KHC Stock

Cola-Cola stock jumped 8.6% this past week to 60.76. The powerful move sent shares above the 10-week moving average but they remain below the 40-week line. KO stock is forming a double-bottom base with a 65.57 buy point, but is well below the entry for now.

KHC stock leapt 10.6% to 38.93 for the week. Shares regained both the 10- and 40-week lines. Kraft Heinz stock is forming a sort of cup base with a 44.97 buy point, and is far below the entry. Much of the pattern has developed below the 50-day line, which is a technical flaw.

Both consumer staples stocks have relative strength lines that are improving but well short of their summer highs. A lagging RS line reflects underperformance vs. the S&P 500.

Apple stock shot up 7.6% to 155.74, on the stock market today after its earnings beat late Thursday. The move pushed AAPL shares above the 10- and 40-week lines. AAPL stock capped a 5.75% weekly gain.

On Oct. 27, Apple also beat earnings and sales views for the September quarter, but warned that the December holiday quarter will be slower.

Berkshire Hathaway is likely to report Q3 earnings soon. BRKB stock leapt 6.1%, moving toward its 40-week line.

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Favorable Trends For Coca-Cola, Kraft Heinz

Top Warren Buffett stocks Kraft Heinz and Coca-Cola may also be benefiting from other trends.

Consumer staples, including chips, burgers and everyday items like soap and toothpaste, tend to enjoy a fairly steady demand despite recessions and pandemics.

Both KO stock and KHC stock offer attractive dividends, yielding 2.9% and 4.1%, respectively. Investors have flocked to dividend stocks for safety amid fears about a possible global recession.

Buffett’s Berkshire also has a smaller stake in Mondelez (MDLZ), whose brands include Oreo cookies and Chips Ahoy cookies. Berkshire’s own portfolio of companies includes Dairy Queen and See’s Candies.


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