Warren Buffett has admitted that he made a mistake in not investing in tech giants Alphabet (GOOGL) and Amazon (AMZN) when he first had the intel to predict their success. Both Alphabet and Amazon are up about $700 over the last 5 years, and are likely to pass the $1,000 mark within the next 12 months.
“I blew it” the hedge fund billionaire told shareholders at the annual meeting of his $148 billion Berkshire Hathaway fund on Saturday. The ‘Oracle of Omaha’ said the clue was in front of his eyes as Berkshire subsidiary Geico was already paying $10/ $11 to Google every time someone clicked on an ad.
Buffett also heaped praise on Amazon CEO Jeff Bezos calling him a “different species” and saying “I was too dumb to realize. I did not think [Bezos] could succeed on the scale he has” and as a result he “really underestimated the brilliance of the execution.”
Tens of thousands of Berkshire investors queued as early as 5AM on Saturday morning for the annual meeting, which also saw Buffett criticize Wells Fargo’s (WFC) former CEO for mishandling the fake-bank-account scandal late last year.
Why TipRanks gives you the bigger picture
Humans are fallible and- in the words of Warren Buffett- we “miss a lot of things, and we’ll keep doing it.” The purpose of TipRanks is to ensure that these mistakes do not dictate the decision making of individual investors.
We believe it is crucial that investors are not overly reliant on the advice of just one financial expert and can instead assess the whole market outlook on a specific stock. By tracking stock recommendations from over 4,500 analysts, 6,000 financial bloggers as well as monitoring the transactions of over 37,000 corporate insiders and 200 hedge fund managers, investors can quickly and easily discover the full picture on any stock.
Stocks Buffett wishes he held- and is it too late to invest now
While Buffett may not have benefited from Alphabet and Amazon’s rapid price explosion, TipRanks’ analyst consensus rating shows that top Wall Street analysts still think these stocks have strong investing potential. We can also see from TipRanks’ stock analysis page that Alphabet has a 12-month price target of $1,047 (10% upside) and Amazon has a price target of $1,078, which translates into an upside from the current share price of 15%.
These figures are based on price targets from only the best-performing analysts i.e. analysts with the highest success rate and average return on their recommendations. Analysts that underperform have a lower ranking so investors immediately know which analysts to trust.
Stocks Buffett actually holds- but for how much longer
Buffett has holdings in two major tech companies- IBM (IBM) and Apple (AAPL). While Buffett upped the fund’s Apple holding by a whopping 277% in the last quarter to $6.64 billion, he is less than satisfied about the performance of IBM as it continues to shift into the AI and cloud computing sectors.
“I don’t value IBM the same way that I did six years ago when I started buying,” he told CNBC a few days ago, saying the company has “run into some pretty tough competitors.” Buffett says he sold a “reasonable amount” of IBM stock at over $180, but stopped selling when prices plunged to current levels of just $155. The fund still has over 50 million IBM shares.
Buffett’s approach to IBM is mirrored by the market’s cautious outlook- TipRanks shows that the analyst consensus rating based on ratings published by analysts over the last three months is Hold.
Top Jefferies analyst James Kisner, who has a 5-star rating on TipRanks, issued a Sell rating on the stock while slashing his price target to $135 from $145 following IBM’s “poor” Q1 results. According to Kisner, the results “mask ongoing secular headwinds that will likely result in disappointment for investors.”