Warren Buffett believes in America – that he will recover from the recession and the COVID-19 pandemic. At a virtual meeting of shareholders in May, the legendary head of Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B) told investors that “nothing can fundamentally stop America” and that “American magic has always prevailed and it will do so again.”
And Berkshire’s portfolio is full of top stocks in the United States – banks, consumer goods, healthcare companies and more – that will rise and fall along with the US economy. Below are three stocks you can buy right now that will allow you to do the same as Buffett ̵
1. Innovative industrial properties
Innovative industrial properties (NYSE: IIPR) is a confidence in real estate investing that gives investors exposure to the marijuana market. By targeting and buying distressed assets from cannabis growers and then leasing back those assets, Innovative Industrial Properties is making strategic investments that can ensure it gets the biggest hit for the dollar. And as long as the cannabis industry continues to grow, you won’t have to worry about vacant properties.
In the results of innovative industrial properties in the second quarter, published on August 5, sales increased by 183% over the previous year. Management says this is largely due to the acquisitions. For the six-month period ending June 30, Innovative Industrial Properties is acquiring 11 properties in different states with rental square footage totaling nearly 1.4 million. By the end of Q2, the company owned 58 properties – more than double the 22 it owned at the same time last year.
This is a great stock to use as a pledge for America, because if the economy is doing well, it means that consumers will continue to buy a lot of cannabis and help the industry grow. This will become a greater demand for the properties that Innovative Industrial Properties own, which will allow it to earn more and make more profit.
The San Diego-based company is currently paying a quarterly dividend of $ 1.06, which today yields 3.8% per annum – much higher than that. S&P 500 on average about 2%.
2. Bank of America
Bank of America (NYSE: BAC) is an action that is directly related to the success of the American economy. Although times are tough amid a recession as the economy recovers and businesses and individuals return to borrow more, Bank of America and other financial institutions will generate more revenue – which in turn will send its shares to come together.
Buffett is confident of recovery and not only continues to hold, but even adds to Berkshire’s position at Bank of America. In recent weeks, Berkshire has invested another $ 1.7 billion in stock; at the end of July it held an 11.8% share. In Berkshire’s most recent 13-F filing, effective May 15, he owned $ 19.6 billion in Bank of America shares.
For most of us, this will not be an easy investment. This is especially true after the results of the second quarter of Bank of America on July 16, in which its net income of $ 3.5 billion was less than half of the $ 7.3 billion that it net for the same period a year ago. He also noted the second consecutive quarter in which the bank’s net income declined.
Shares of Bank of America fell more than 27% this year, and now the shares are trading at only 0.9 times book value and 12 times profit. And with its quarterly dividend of $ 0.18, still intact, investors can make a profit of 2.8%.
alphabet 09.30 NASDAQ: GOOG09.30 NASDAQ: GOOGL is another great stock you can invest in if you are the bull of recovery. A strong economy is one in which consumers buy the latest and greatest gadgets, which means that advertisers will spend a lot of money to promote their latest products and services. Unfortunately (albeit surprisingly), Alphabet’s advertising revenue is hurting right now.
The company released its second-quarter results on July 30, and it was the first time that the technology giant’s sales were down from the previous year. Revenue of $ 38.3 billion fell 2% from $ 38.9 billion a year ago. Advertising revenue of $ 29.9 billion fell 8% and net revenue of $ 7 billion fell 30%.
Despite disappointing numbers, Alphabet beat expectations as analysts expect revenue to fall to $ 37.4 billion. Adjusted earnings per share of $ 10.13 were also better than Wall Street forecasts of $ 8.21.
Remember, this was also a particularly terrible quarter for the economy. Blockages were introduced in many states in April and May, preventing some companies from even operating. Cutting ads was an obvious move for tough companies looking to save money. For Alphabet, however, this meant that this quarter – which lasted until the end of June 30 – was unlikely to be good.
But it is also a reason to hope that when the economy recovers, things will improve for everyone, including Alphabet, and that advertising revenue will recover in the coming quarters.
Which warehouse should you buy today?
All three stocks listed here are attractive purchases that can help you diversify your portfolio. Let’s take a look at how they handle the S&P 500:
The only stock of Bank of America that does not exceed the index. And if you need a good bank stock to add to your portfolio at a cheap price, this can be a great purchase. But if you are looking for a high dividend or growth, Innovative Industrial Properties will give you the best of both worlds and this is the action I would go with right now. That said, like Buffett, I think it makes sense to bet on America. And in that sense, it’s hard to confuse any of these stocks in the long run.