Like individual investors, mutual fund managers may have a hard time finding growth names to buy in a struggling stock market. When mutual funds rotate to the same defensive stocks that legendary value stock picker Warren Buffett owns, it shows there are slim pickings in the growth stock arena.
And this rotation can be seen in today's list of names on the Investor's Business Daily's stock screener list. Today's screen is Stocks That Funds Are Buying. Topping the list of 14 names is Dow Jones component and Warren Buffett long-term holding Coca-Cola.
O'Reilly Automotive also made the list and is in a buy zone.
Although these stocks are technically in or near buy ranges, the stock market is in a correction. Be sure to read Investor's Business Daily's The Big Picture column for stock market insight.
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Warren Buffett Favorite Coca-Cola Stock Builds A Base
Filings say Buffett's Berkshire Hathaway owns 400 million shares of Coca-Cola stock.
Shares of the soft drink giant bucked the trend and climbed around 1.5% Monday in above-average volume as the major indexes sold off. Coca-Cola stock is nearing the 73.53 buy point of a long saucer base, according to MarketSurge pattern recognition. The buy point is also its all-time high reached Sept. 4.
And its weekly chart shows the defensive stock is in a buy zone up to 75.36 from a handle entry at 71.77. It also sits in the buy range of a three-weeks-tight pattern with a 72.65 entry point.
Coca-Cola's relative strength line has climbed sharply since late January. The company topped fourth-quarter profit and revenue estimates on Feb. 11. Coca-Cola's earnings are forecast to climb a modest 3% in 2025 and 8% in 2026.
Its IBD Accumulation/Distribution Rating of B+ indicates fairly heavy institutional buying over the last 13 weeks. And its volume has been trending higher this year, as big money managers scoop up shares. Further, its 1.4 up/down volume ratio shows positive demand over the last 50 days.
The company has been a steady profit grower as seen in its Earnings Stability factor of 4 out of 99 possible — with a lower number being better. And as a bonus, the blue-chip stock offers a hearty 2.8% dividend yield to shareholders.
O'Reilly Stock Tops Buy Zone
O'Reilly Automotive is another defensive stock making the IBD screen as car owners tend to keep and repair older cars instead of buying new ones in uncertain times.
Shares of O'Reilly are inching above the top of a flat-base buy zone up to 1,348.16. The stock has been volatile since the company's mixed fourth-quarter earnings report on Feb. 5. But shares are also near a record high of 1,389.05 set on Tuesday. O'Reilly stock has gained more than 13% so far this year.
The auto parts retailer missed profit forecasts but beat on revenue. Management also provided a full-year 2025 earnings outlook that came in below estimates.
The auto parts retailer holds a 7 Earnings Stability factor. Its Accumulation/Distribution Rating of B- and its 1.2 up/down volume ratio support its recent increase in mutual fund ownership.
Follow Kimberley Koenig for more stock market news on X, the platform formerly known as Twitter, @IBD_KKoenig.
