Buffett's Investment Playbook: Kroger and DaVita Stand Out

In a volatile market, Buffett endorses Kroger and DaVita as solid investments. Kroger boasts stable EPS growth and a strong dividend, while DaVita shows year-on-year profit growth and an attractive valuation. Both stocks position well for future upside.

Date: 12-04-2025

AI Rating: 8

Buffett's approach to investing continues to be a guiding force in the current unpredictable stock market. Highlighting two key investments, Kroger and DaVita, offers insights into what may positively influence stock prices in the near term.

Kroger (NYSE: KR) has displayed resilience amidst market fluctuations. The projected adjusted EPS between $4.60 and $4.80 for 2025 indicates a 5.1% increase year-over-year, showcasing solid revenue growth. The dividend growth to $0.32 per share, yielding 1.9%, is also noteworthy, making Kroger an appealing choice for dividend-seeking investors.

DaVita (NYSE: DVA), specializing in kidney dialysis services, reported a total revenue of $12.8 billion, marking a revenue growth of 5.6% year-over-year. The adjusted EPS reaching $9.68, up 26%, signals robust profitability improvement driven by higher pricing and Medicare reimbursement rates. At 13 times its forward P/E ratio, DaVita appears undervalued compared to its historical average of 17, suggesting potential upsides in stock performance.

Overall, both companies reflect characteristics of strong fundamentals that Buffett tends to favor. Appropriate responses to economic conditions and strategic investments in high-quality stocks should resonate well with investors seeking stability amid current market uncertainties. The report advocates for maintaining a long-term investment perspective, which remains essential for navigating this dynamic environment.

Stocks: BRK.A BRK.B KR DVA