Warren Buffett’s Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B) portfolio may not feature Coca-Cola as its largest position, but it is certainly one of the billionaire’s favorite investments. In fact, it has been a staple in his portfolio for over three decades.
From 1987 to 1994, Buffett steadily accumulated 400 million shares of Coca-Cola and has held onto that position ever since. This steadfast commitment to the beverage giant reflects his faith in the company’s enduring brand strength and competitive moat – qualities that align with his investment philosophy. Moreover, Coca-Cola has consistently delivered on earnings growth and dividend payouts, further solidifying its place in Berkshire Hathaway’s long-term holdings.
While Coca-Cola might remain a permanent fixture in Buffett’s portfolio, there is another stock that could soon join its ranks as one of his “forever” holdings – Apple (NASDAQ: AAPL). Despite reducing his stake during the second quarter, Buffett’s confidence in Apple remains unwavering. He views the recent sale as a strategic move linked to capital gains tax rates rather than a lack of faith in the company.
The recent sale brings Berkshire Hathaway’s holding down to 400 million shares – mirroring its stake in Coca-Cola. This intriguing parallel aside, there are strong arguments supporting Apple as Buffett’s next long-term investment darling.
Buffett admires Apple CEO Tim Cook for his leadership and decision-making prowess reflected by share buybacks that benefit shareholders at no additional cost. These share repurchases have significantly increased Berkshire Hathaway’s ownership percentage since they began buying Apple stock back in 2016.
Furthermore, under Cook’s guidance, Apple has demonstrated double-digit earnings growth over five years and maintained a formidable competitive moat similar to Coca-Cola’s brand strength. The company also stands out for dominating smartphone sales year after year with top-selling models across various markets worldwide.
Another factor contributing to Apple’s potential longevity in Berkshire Hathaway’s portfolio is its commitment to dividends. While technology companies are not known for their dividend payouts due to aggressive re-investment strategies for growth, Apple pays out an annual dividend of $1 per share with a current yield of 0.4%.
In light of these compelling factors–strong earnings track record, enduring competitive moat, and consistent dividend policy–Apple seems poised to earn itself a permanent spot alongside Coca-Cola as one of Warren Buffett’s “forever” stocks.
