By: Sayan
Published on: May 23, 2025
Warren Buffett, the legendary investor and CEO of Berkshire Hathaway, is renowned for his long-term, value-driven approach to stock picking. While Buffett plans to transition leadership to Greg Abel by the end of 2025, his influence remains evident in Berkshire’s latest 13F filing from May 15, 2025. With thousands of publicly traded companies worldwide, Berkshire’s portfolio is notably selective, holding only around 40 stocks. This exclusivity signals Buffett’s confidence in each position. In this article, we explore three standout Buffett stocks—Amazon (AMZN), Domino’s Pizza (DPZ), and Pool Corporation (POOL)—that offer strong potential for long-term investors in 2025 and beyond.
Key Points
Amazon (NASDAQ: AMZN) is a cornerstone of Buffett’s portfolio, despite being a smaller position compared to giants like Apple or American Express. As of May 2025, Amazon’s stock is down 17% from its all-time high, presenting a rare buying opportunity. Historically, such dips have proven advantageous for investors, and the current decline is no exception, driven by the explosive growth of Amazon Web Services (AWS).
AWS, Amazon’s cloud computing arm, generates an annualized revenue of $117 billion as of Q1 2025, making it one of the world’s largest businesses if standalone. CEO Andy Jassy estimates that 85% of enterprise IT spending remains on-premises, with a significant shift toward cloud platforms like AWS expected over the next decade. The rise of artificial intelligence (AI) further amplifies AWS’s potential, as businesses leverage cloud infrastructure to power AI applications.
With a Q1 operating margin of nearly 40%, AWS is Amazon’s most profitable segment. As cloud adoption accelerates, Amazon’s profits are poised to grow, making AMZN one of the best Warren Buffett stocks to buy and hold for long-term wealth creation.
Why Invest in Amazon?
Berkshire Hathaway increased its stake in Domino’s Pizza (NASDAQ: DPZ) by 10% in Q1 2025, signaling Buffett’s confidence in this global pizza leader. Domino’s aligns with Buffett’s preference for businesses with enduring consumer demand—pizza is a timeless favorite unlikely to fade. As the world’s largest pizza chain, Domino’s benefits from a capital-light, high-margin franchise model.
Recent initiatives, such as new menu items and a partnership with DoorDash, have boosted consumer demand and franchisee profitability. While Domino’s isn’t a high-growth stock, its consistent free cash flow supports share repurchasing and dividend increases, enhancing shareholder value over time. The chart below illustrates Domino’s steady reduction in outstanding shares, a move that boosts earnings per share for investors.
For patient investors, Domino’s offers stability and steady returns, making it a reliable Buffett stock for long-term portfolios.
Why Invest in Domino’s?
Perhaps the most surprising of Buffett’s Q1 2025 purchases, Berkshire more than doubled its stake in Pool Corporation (NASDAQ: POOL), the largest percentage increase among its recent buys. Pool, a distributor of pool supplies and equipment, is currently facing headwinds, with net sales down 4% in 2024 and Q1 2025 due to a slowdown in new pool installations. Management projects 2025 earnings per share (EPS) of $11.10 to $11.60, a decline from $19 a few years ago.
Despite these challenges, Pool’s business model offers predictability, with 60% of revenue derived from recurring maintenance spending by existing pool owners. The company maintained a 5% profit margin in Q1 2025, outperforming competitors with no profits. Pool also returned over $100 million to shareholders through buybacks and dividends in Q1 alone, demonstrating a commitment to shareholder value. With a market cap of $11 billion, these efforts are significant.
Looking ahead, an eventual rebound in new pool installations could provide a growth catalyst, expanding Pool’s customer base for ongoing maintenance revenue. This contrarian bet aligns with Buffett’s knack for investing in undervalued companies with strong fundamentals.
Why Invest in Pool?
Amazon, Domino’s, and Pool stand out as top Warren Buffett stocks due to their unique blend of stability and growth potential. Amazon offers exposure to the booming cloud computing and AI sectors, while Domino’s and Pool provide steady cash flows and shareholder-friendly policies. Although Amazon is the standout for its high-growth potential, all three align with Buffett’s philosophy of investing in businesses with durable competitive advantages.
Before investing, consider your financial goals and risk tolerance. The Motley Fool’s Stock Advisor team recently highlighted 10 stocks with strong return potential, excluding Amazon. For context, a $1,000 investment in Netflix (recommended in 2004) would be worth $644,254 today, and a similar investment in Nvidia (recommended in 2005) would be worth $807,814. While past performance isn’t a guarantee, these Buffett-approved stocks offer a compelling case for long-term investors.
Ready to Invest? Start with Amazon for its unmatched growth potential, or diversify with Domino’s and Pool for stability. Always conduct thorough research or consult a financial advisor before making investment decisions.
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