The Oracle of Omaha is famous for making large purchases in companies like IBM (IBM) and Coca-Cola (KO), but this isn’t where he made all of his biggest returns. The investments that made Buffett worth $72 billion are in smaller less known companies with higher potential for growth and businesses protected from competition. 

Hands down, Warren Buffett is one of the greatest investors of all-time.

And after Buffett made his largest purchase ever last week, spending $37 billion for Precision Castparts (PCP), it is time to look at other companies that might be on Buffett’s radar.

However, this isn’t what you’d think; we’re not looking for companies that Buffett might buy, rather, we’re looking for companies that Buffett would buy, if he could.

As of now, Buffett is managing a stock portfolio of over $100 billion, which means, it is tough to find companies that can really move the needle for him and Berkshire Hathaway (BRK-B).

As a result, Buffett has to stick to mega-cap stocks like International Business Machine (IBM) and Wal-Mart (WMT). That’s because buying shares of smaller companies does little to meaningfully boost his portfolio value. But just because Buffett is handcuffed to slow-growth large-cap stocks, you don’t have to be.

This comes as Buffett still believes that it’s within the smaller-cap space that alpha is really generated. During a shareholder meeting back in 1999, Buffett said that he could generate returns of 50% if he had less money. That’s because he would be able to invest in smaller and faster growing companies.

As retail investors, we can use Buffett’s methodology to find smaller companies that Buffett and large asset managers just can’t invest in.

To start — if you look at some of Buffett’s greatest investments, they all came when he could invest a large part of his portfolio in small- and mid-cap stocks.

This includes some stocks that Buffett currently owns, like Coca-Cola (KO), American Express (AXP) and Wells Fargo (WFC).

Buffett first invested in Coca-Cola back in 1988. Back then, shares of Coke were trading between $2 and $3 a share. By the mid-90s, Buffett had invested $1.2 billion in Coke, which by today’s standards, is a small position for Berkshire. At the time, Coke was just a $16 billion market cap company.

Going back even further, Buffett first bought American Express back in 1964 after the company lost half its market value related to a scandal by a salad oil company. Buffett was able to invest $1.3 billion in the payments company. Then there’s Wells Fargo, where Buffett first took a $290 million stake in the bank back in 1990. Back then, Wells Fargo was a $2 billion market cap company.

The big issue is finding these small- and mid-cap value stocks.

In Buffett’s recent shareholder letter, he lays out his criteria for companies he looks to buy. First, companies should have current earnings power and not be turnaround situations

The big metric Buffett looks for is return on equity. But not just a high ROE, the company has to have a history of generating a high ROE for many years. All three companies below have median 10-year ROEs of 17% or higher.

While Buffett likes companies that can generate nice returns on shareholder capital, he’s not a fan of using too much debt to do so. Thus, look for companies with low debt-to-equity ratios — all three stocks below have debt-to-equity ratios of below 50%.

Finally, Buffett is notorious for sticking to companies that are easily understood. Just look at the simplicity of some major brands he owns — makers of paints, underwear, furniture, kitchenware, and candy.

With all that in mind, here are three stocks that Buffett would buy if he could:

No. 1: Buffett-Like Stock: Lear Corp (LEA)

The first company that makes the list is the $8 billion market cap supplier of automobile seats and electric power systems, Lear. This sticks to Buffett’s industrial theme nicely and its current ROE is nearly 25% and its 10-year median ROE is 19%.

Granted, Lear went through bankruptcy reorganization a number of years back, but since then it’s been an earnings generating machine. It has a debt-to-equity ratio that’s just around 20% and is using cash to buy back stock.

Lear is a great play on the growing global premium-vehicle segment. This comes as automakers are focusing more on quality interiors and there’s a proliferation of automotive electronics. The other powerful trend for Lear is the rise of all-electric and electric hybrid vehicles, which also contain higher power-management content.

No. 2 Buffett-Like Stock: Thor Industries (THO)

Thor is a $2.9 billion market cap company, but still the world’s largest manufacturer of recreational vehicles. It’s the market share leader for the entire RV market, owning both categories — fifth wheels (tow behind) and motorhomes. A sizable moat, which Buffett likes. Thor also has over 1,300 dealers across the U.S. and Canada.

Thor checks another major box for Buffett — which is a lengthy history of earnings. Thor has been profitable for every year since inception in 1980. Its ROE is over 17% and it has virtually no debt, with a debt-to-equity ratio of 8%.

If you want to own the leading automobile maker you have to invest in a $50 billion market cap company like General Motors (GM). Or you can invest in the leader in RVs, with a superior ROE, no debt, and enticing valuation, at a twentieth of the market cap.

No. 3 Buffett-Like stock: Fluor Corp (FLR)

Buffett’s recent purchase of the aerospace parts maker, Precision Castparts, highlights Buffett’s love for industrials. Along those lines, Fluor is the leader in engineering and construction, with a $7 billion market cap. Its ROE is over 17% and its debt-to-equity ratio is a mere 13%. The beauty of Fluor is that it also checks another key box for Buffett, strong management.

Its current CEO, David Seaton, stepped into the driver’s seat in 2011 and has been with the company since 1984 — holding a number of positions, from sales to global operations and also COO.

Fluor is a play on the global rise of a company’s desire to manage costs. It also has a backlog of over $40 billion worth of work. A key tailwind for Fluor includes the urbanizing of emerging markets.

As a bonus — if you dig through Buffett’s current portfolio, you can still find some small-cap gems, including the one below, which you can buy cheaper than Buffett paid.

The company is Chicago Bridge & Iron (CBI), which is the engineering and construction company, not unlike Fluor. Buffett has a $527 million position in this $5.5 billion market cap company, owning 9.9% of shares outstanding.

Buffett first bought shares back in the first quarter of 2013 and added significantly to his position in 2Q 2013. Thus, Buffett was buying when shares were around $60 apiece, but now trading at ~$52 a share. The stock has taken a beating despite strong operational performance and a strong backlog of projects.

In the end, following Buffett’s actual stock picks isn’t a horrible investing strategy. But, actually using his methodology to find undiscovered stocks looks to be much more worthwhile.