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These 2 stocks from Warren Buffett's portfolio could rise 129% and 140% in the next 12 months, according to analysts

Jamie Cameron
9. 11. 2022
4 min read

As of last week, Warren Buffett held nearly forty stocks in his investment portfolio through Berkshire Hathaway. Two of those titles have been given high price targets by Wall Street, suggesting they could rise 129% and 140% over the next 12 months.

Warren Buffett

General Motors $GM-0.2%: Implied up 129%

If there's a Wall Street price target for Warren Buffett's stock that has to impress investors, it's the $90 price target that analyst John Murphy of Bank of America Securities has set for automaker General Motors. If that price target is met, GM shareholders would enjoy a 157% gain from where the company's stock ended Wednesday, Nov. 2.

Five-year price chart of GM stock

This ambitious target reflects two key aspects of the company - its financial growth potential and electric vehicle (EV) strategy. When investors hear about companies that have doubled their top-line earnings, most would think of smaller, younger companies - not the massive, historic General Motors, which has seen countless automakers go definitively bankrupt during its existence. But don't count GM out of that level of growth just yet. The company plans to double its revenue to $275 billion to $315 billion by 2030.

Part of that huge growth will come from its core automotive business, which is targeting a compound annual growth rate (CAGR) of 4% to 6% through 2030. But more interesting to investors is the projected 50% CAGR in software and new ventures over the same time period. What's more, its self-driving vehicle subsidiary Cruise is aiming for $50 billion in annual revenue by 2030.

Another new business is GM Ultifi, its software platform focused on creating value through vehicle experiences and meeting consumers' digital needs. Ultifi will roll out next-generation products starting next year and is expected to produce $20 billion to $25 billion in revenue by 2030.

GM expects not only top-line growth but also margin expansion from its new stores. Management expects margins to reach 12% to 14% by 2030, thanks in part to margins from new stores exceeding 20%. Yes, these are long-term visions with a lot of uncertainty that is sure to hit before 2030, so investors need to have some long-term confidence in management's ability to execute its new business strategies.

Amazon $AMZN+0.6%: Implied up 140%

Another Warren Buffett stock that has a high price target on Wall Street is none other than the FAANG stock Amazon. Analyst Ivan Feinseth of Tigress Financial set a $4,655 price target for the company earlier this year. But after his 20-for-1 forward stock split, Feinseth's revised price target of $232.75 implies about a 140% upside from where he closed on Tuesday, Nov. 1.

AMZN stock has appreciated 74.15% over the past 5 years

This high price target reflects the company's strong position in the e-commerce segment. Amazon operates the most visited online marketplace and last year ranked as the second largest digital retailer in the world, as measured by gross merchandise value. This bodes well for the future. Retail sales from e-commerce are expected to grow nearly 10% annually and reach $7.6 trillion by 2028, according to Grand View Research. But Amazon's most exciting opportunities lie in the higher-margin cloud computing and digital advertising markets.

In this context, Amazon Web Services is the leader in cloud infrastructure and has a larger market share than Microsoft Azure and Alphabet 's Google Cloud combined. And according to Grand View Research, cloud computing spending is expected to grow 15.7% by the end of the decade.

Finally, Amazon is the fourth-largest digital advertiser in the world, but eMarketer says it nearly led the world in ad revenue growth last year. With that in mind, digital ad spending is expected to grow 9.2% annually through the end of the decade, according to Precedence Research, but investors should expect Amazon to continue to outperform that trajectory.

DISCLAIMER: All information presented here is for informational purposes only and is in no way an investment recommendation. Always do your own analysis.

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