This trend continues today. Small-cap stocks were around 30% cheaper than large cap stocks as of the start of the final quarter of 2023, according to an analysis by BNP Paribas. This valuation gap is near a 25-year low, suggesting the potential for small-cap outperformance as market conditions shift, based on a report by Royce Investment Partners.

Which of his top five stocks is the best pick depends on your investing style. The best overall stock, though, could be the one to which Buffett has given the highest praise. However, Buffett has over $1 trillion of Berkshire's portfolio invested in other publicly traded companies.