Warren Buffett once wrote, “When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.” While Buffett constantly aimed to buy only wonderful businesses, few met the criteria for becoming the stocks Berkshire Hathaway(NYSE: BRKA)(NYSE: BRKB) would hold forever.
In his first letter to shareholders, Buffett’s successor at Berkshire, Greg Abel, called out nine companies he describes as core holdings in the company’s equity portfolio. Combined, they account for over 60% of the company’s portfolio. Investors should expect “limited activity in these holdings,” Abel said. Many of the stocks Abel mentioned align with previous comments from Buffett, but not all of them. Here are the nine stocks Abel plans to hold forever.
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Apple(NASDAQ: AAPL) is Berkshire Hathaway’s largest marketable equity position. That’s despite Warren Buffett’s decision to sell more than three-quarters of its shares over the last two years of his tenure as CEO. Abel’s comments in his shareholder letter suggest that the selling spree could be over.
Apple’s lower capital intensity compared to its big-tech peers has made it stand out so far in 2026. While hyperscalers are spending over $700 billion in combined capital expenditures to build out artificial intelligence (AI) data centers this year, Apple is on track for another year of free cash flow exceeding $100 billion.
Despite delays in its revamped Siri, meant to introduce more powerful AI features to its devices, Apple saw strong sales growth last quarter across both devices and services. iPhone sales, in particular, stood out, up 23% year over year, bolstered by strength in Greater China. If the Siri revamp is a success, it could post another strong year of iPhone sales this year as it spurs a major upgrade cycle.
While the stock may seem expensive at 30 times forward earnings, its share repurchase program, solid revenue growth, and expanding margins make it a fair price for the stock.
American Express(NYSE: AXP) has been a core holding for Berkshire for over 30 years, and Abel intends to continue to hold the stock indefinitely.
Amex is successfully executing on its efforts to attract high-end consumers and small businesses with its card portfolio. It refreshed the Platinum card last year for both consumers and businesses, and it was met with praise despite the increase in annual fees. Those fees are growing quickly, but they’re now just a small part of the business. Net interest income is also climbing, as Amex has shifted to offering more credit lines instead of charge cards paid off in full each month. Still, the majority of revenue comes from the interchange fees it collects from payment processors on each transaction.
Amex is well-positioned to capitalize on the continued shift to digital payments. It’s using its flagship cards to attract young, high-income customers to its product and keep them for the long run. That enables it to generate strong operating leverage, driving earnings growth faster than its top line. As such, its forward P/E ratio of just 17 looks like a great value right now.
Coca-Cola(NYSE: KO) is another longtime holding established by Buffett. The company’s moat stems from its global brand recognition. That enables it to raise prices in established markets and use its existing products to introduce new ones and expand its addressable market. The result is steady revenue growth and margin expansion.
Management targets mid-single-digit revenue growth over the long run, and it achieved just that last year. Its 5% organic revenue growth for the year was primarily driven by price increases. Investors can expect similar growth in 2026 with slightly better earnings-per-share growth from margin improvements and share repurchases.
With the stock trading at 24 times forward earnings, it might be a bit overpriced given the slow-and-steady nature of the business. But considering Berkshire’s sitting on $29.5 billion worth of capital gains on its original investment of $1.3 billion, it’s unlikely Abel wants to sell those shares anytime soon.
Buffett never called out Moody’s(NYSE: MCO) as one of his forever stocks, but Abel made it clear that it’s a core position in his letter to shareholders. Berkshire originally acquired the stock in 2000 and sold off roughly half of it in 2009 and 2010. But Buffett didn’t touch the stock after 2013.
Moody’s is a credit rating agency that’s trusted worldwide. That’s important for investors and bond issuers alike. Bond investors want to know whether debt issued by one company is safer or riskier than a bond issued by a completely different company. To do that, they need to be rated by the same agency. That creates a network effect, giving Moody’s a wide moat for its Investors Service business, which accounts for about two-thirds of its income. The rest of the company’s earnings come from its Analytics business, which is growing faster. Moody’s is using acquisitions to help scale, expanding its market and services.
Pricing power for the ratings business and operating leverage in its analytics business should help push earnings per share up double digits next year. Management guided for 9% revenue growth. With shares trading for 28 times forward earnings estimates, it looks like a fair price to pay for the stock.
In 2019, Buffett and Charlie Munger established positions in each of the five Japanese trading houses: Mitsubishi(OTC: MSBHF)(OTC: MTSU.Y), Mitsui(OTC: MITSY)(OTC: MITSF), Itochu(OTC: ITOCF)(OTC: ITOCY), Sumitomo(OTC: SSUMF)(OTC: SSUMY), and Marubeni(OTC: MARUF)(OTC: MARUY). He added to them over the years, exceeding 10% stakes in several last year.
These five companies all operate in a similar manner to Berkshire Hathaway. As such, Abel sees them not just as investments but also as potential partners for international investments. With the five trading houses, Abel has a wealth of experts to consult across multiple industries.
Many of the stocks continue to trade at attractive valuations. Berkshire has borrowed yen equal to the amount of its cost basis, hedging some of the currency risk of the investment while taking advantage of the country’s low interest rates. Meanwhile, the dividends paid by the businesses more than cover the interest paid on the loan.
Abel said other companies could eventually become core holdings, but for now he may be focused on trimming non-core positions and on the biggest and best investments in Berkshire’s portfolio.
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American Express is an advertising partner of Motley Fool Money. Adam Levy has positions in Apple. The Motley Fool has positions in and recommends Apple, Berkshire Hathaway, and Moody’s and is short shares of Apple. The Motley Fool has a disclosure policy.
Greg Abel Has Over 60% of Berkshire Hathaway’s Stock Portfolio Invested in 9 Forever Stocks was originally published by The Motley Fool
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