2 Warren Buffett Stocks to Get Greedy With Right Now

As is customary, the third-quarter filing had a few surprises. Let’s look at two Buffett stocks mentioned in the recent disclosure that would suit practically any investor. These are two equities you should consider becoming greedy with.
1. Taiwan Semiconductor Manufacturing Co., Ltd.
Image Courtesy: ET TelecomTaiwan Semiconductor Manufacturing (NYSE: TSM), the world’s largest microchip maker, was Berkshire’s most shocking acquisition in the third quarter. TSMC, as it is often known, is the business that chip designers such as Nvidia, Advanced Micro Devices, Apple, and Intel hire to manufacture the chips they develop.Berkshire acquired more than 60 million shares of TSMC in the third quarter for around $4 billion. It is presently Berkshire’s tenth-largest holding.TSMC possesses a lot of characteristics that distinguish it from a typical Buffett stock. First, being the largest semiconductor foundry, it enjoys a massive economic moat. TSMC is used by a wide range of enterprises and products, and it controls 53% of the foundry market share.A monopoly with a majority market share in a critical industry sounds ideal for a Berkshire holding, and TSMC also has monopolistic margins. The firm posted an operating profit of 50.6% in the most recent quarter because it spends relatively little on overhead expenditures to manage its foundries.TSMC is also rapidly expanding, with revenue increasing 48% year on year. And Buffett would almost definitely approve of the pricing, which trades at a price-to-earnings ratio of 15 and a dividend yield of 2.3%. Because of investor concerns about Chinese equities, TSMC certainly trades at a discount, although the chipmaker hasn’t received as much criticism as Tencent or Alibaba. TSMC, on the other hand, manufactures critical infrastructure and has its headquarters in Taiwan making it more politically sensitive than Mainland Chinese companies.2. RHRH (NYSE: RH), formerly known as Restoration Hardware, is considerably smaller than TSMC, but Berkshire increased its RH holdings in the third quarter, purchasing 190,000 extra shares of the home-goods business. This takes the total number of shares to 2.36 million, or around $230 million.RH share prices have dropped more than 50% since their peak in September 2021, as demand for home furnishings slows as the pandemic’s boom fades and recessionary headwinds start in.RH, on the other hand, is still extremely lucrative; its adjusted operating margin was 24.7% in the second quarter. This is an abnormally high-profit margin for a retailer, indicating its competitive edge.RH uses a novel business strategy, selling memberships to increase client loyalty and stimulate repeat purchases. Wall Street was skeptical when RH originally proposed it in 2016, but the stock and the company have risen since then, proving RH CEO Gary Friedman correct.The corporation is also attempting to broaden its brand beyond home goods by operating hotels and restaurants, as well as leasing jets and yachts. RH will also develop its own streaming service focused on architecture and design.These actions demonstrate the company’s intention to extend its brand value in home goods into new industries. With its rich, dedicated client base, the plan, particularly the streaming content, might pay off. The company is anticipated to suffer the effects of macroeconomic headwinds in the coming quarters. However, when the economy improves, RH seems poised to rocket since its new companies will have had time to gain traction.The company is now trading at a price-to-earnings ratio of under 10, which appears to be an excellent value for a revolutionary luxury brand with a lengthy track record of outperformance. Buffett and his colleagues are certainly paying attention.