Best 10 Blue-Chip Stock Buys
We contributed to a Forbes article, along with other investment strategists, entitled: “How To Invest Your Money In 2016: Best 10 Blue-Chip Stock Buys.” We were asked to share the best blue chip stock for investors to consider and buy.
President, Daniel Beckerman, CFP®, ChFC® discussed Warren Buffett’s Berkshire Hathaway (BRK.B) with $323 billion market cap.
Due to the high price of A shares and the lack of flexibility, we recommend owning the B shares. Also, if Berkshire gets a little overvalued or if you want to recognize a capital loss for tax purposes, you can easily re-balance with the B shares, which is not an option with the A shares.
“Berkshire Hathaway shares look cheap having lagged the S&P 500 Index (SPY) in the last five years. You cannot always buy Berkshire Hathaway (BRK.B) at a reasonable premium to book value.” Moreover, another reason for considering this stock is the investment protégés, Todd Combs and Ted Weschler. Looking at their track records, they performed far better than the S&P 500 Index (SPY) when they ran their own hedge funds. “Combs and Weschler are already allocating more and more of Berkshire’s investments each year. Buffett and Charlie Munger have not made their entire succession plan public, but they have referenced the fact that there is a plan in place with some internal Berkshire Hathaway associated personnel.” Given what has been made public, Buffett’s role at the company will be split into numerous positions: including non-executive chairman, CEO, and portfolio manager.
The question to ask yourself as an investor is whether you want to allocate your money to a stock market index fund, or with a team that Buffett has hand-picked to outperform the S&P 500 Index (SPY) over time. It would be, without hesitation, more than easy to bet on Buffett and his team.
Some of the other stock recommendations include:
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Walt Disney Co (DIS) ($184 billion market cap) by John Traynor of People’s United Wealth Management
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J.P.Morgan Chase & Co (JPM) ($240 billion market cap) by Jonathan Camarda of Camarda Wealth Advisory Group
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General Electric Co (GE) ($307 billion market cap) by Arnim S. Holzer of ASH Strategy, LLC
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Danaher Corp (DHR) ($65 billion market cap) by Mike Bailey of FBB Capital Partners
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Alkermes PLC (ALKS) ($11 billion market cap) by Michael Kramer of All Cap Growth Portfolio and Mott Capital Management
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BlackRock Inc (BLK) ($56 billion market cap) by Cheryl Young of Morgan Stanley
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Apple Inc (AAPL) ($648 billion market cap) by Eldon Dryden Pence III of Pence Wealth Management
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Valero Energy Corp (VLO) ($34 billion market cap) by Dan Neiman of Neiman Funds
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International Business Machines Corp (IBM) ($133 billion market cap) by William McMahon of ThomasPartners, Inc