The Best Warren Buffett Stocks to Buy With $500 Right Now

John Ballard, The Motley Fool

Sat, May 17, 2025, 3:14 PM 5 min read

• Apple and American Express are two of Berkshire Hathaway's largest investments.

• Apple's push into services, in addition to Apple Intelligence, should lead to profitable growth for investors.

• American Express is a resilient credit card brand that continues to adapt its offering to win over a new generation of consumers.

• 10 stocks we like better than Apple ›

Warren Buffett is one of the best investors the world has ever seen. From 1965 through 2024, a $100 investment in Berkshire Hathaway would have turned into $5.5 million.

If you're looking to invest some extra cash right now, Berkshire's $263 billion stock portfolio is a great starting point. Apple (NASDAQ: AAPL) and American Express (NYSE: AXP) were two of Berkshire's largest investments at the end of 2024. You can buy one share of both stocks for just over $500 at the time of writing. These companies have powerful brands that could serve as a solid anchor for a well diversified portfolio.

Berkshire Hathaway held 300 million shares of Apple worth $75 billion at the end of 2024. Since Berkshire first started buying the stock in 2016, Apple has had a great run. Its installed base of active devices has grown to over 2.3 billion and is still growing.

Buffett invests in companies that have strong competitive advantages. In Apple's case, that starts with its brand and the attachment people have to their phones. As CEO Tim Cook said on Apple's fiscal Q2 earnings call, "Apple services are enriching our users' lives all throughout their day."

The iPhone generates over half of the company's revenue. People carry their phones wherever they go, and that just keeps the cash pouring in for Apple. Revenue from services, including Apple Pay, generates twice the gross profit margin as sales of devices, and it's Apple's fastest-growing segment, with revenue up 12% year-over-year last quarter.

Apple could benefit enormously from artificial intelligence (AI). The rollout of Apple Intelligence conveniently puts a generative AI-powered device within easy reach. Apple is investing to deeply integrate AI across its devices, which could drive more iPhone sales over time.

Another important reason Buffett likes Apple is its profitability. Over the last year, Apple generated $97 billion in net income on $400 billion of revenue. This provides ample resources to reward shareholders. For example, it returned $29 billion to shareholders through dividends and share repurchases in the last quarter alone.

Apple is truly the gift that keeps on giving. Analysts currently expect the company's earnings per share to grow at an annualized rate of 11% over the long term, which should fuel higher share prices.