Warren Buffett's Berkshire Hathaway holds three stocks with annual yields up to 65%
Warren Buffett left Berkshire Hathaway with a 368 billion dollar portfolio.
The short version
- Three long-term holdings are now paying out massive annual yields on cost.
- Coca-Cola yields 65 percent, American Express yields 45 percent, and Moody's yields 41 percent.
- Patient investing over decades built these returns.
Warren Buffett's Berkshire Hathaway, the trillion-dollar conglomerate, holds a 368 billion dollar investment portfolio featuring three time-tested companies generating annual yields of 65 percent, 45 percent, and 41 percent. The companies powering these jaw-dropping dividends are Coca-Cola, American Express, and Moody's. Berkshire Hathaway is in uncharted waters after longtime CEO Warren Buffett retired from his post and stepped down as chairman of the board, handing the reins to his protégé, Greg Abel, according to Yahoo Finance.
The not-so-subtle secret to the outrageous annual yields Berkshire is generating is patience and time. On the surface, the current yields for Coca-Cola at 2.22 percent, American Express at 1.17 percent, and Moody's at 0.84 percent are modest. However, these are the longest-tenured holdings in Berkshire's portfolio, which heavily impacts their cost bases.
Coca-Cola and American Express have been held continuously since 1988 and 1991, while Moody's has been held since 2000. Berkshire's cost basis per share is 3 dollars and 25 cents in Coca-Cola, 8 dollars and 49 cents in American Express, and 10 dollars and 5 cents in Moody's.
Coca-Cola, the global beverage giant, doles out 2 dollars and 12 per share annually, equating to a 65 percent yield relative to Berkshire's cost basis after raising its dividend for 64 consecutive years. American Express, the credit card and financial services giant, pays 3 dollars and 80 per share annually, working out to a roughly 45 percent yield on cost.
Moody's, the credit-rating agency, pays 4 dollars and 12 per share annually, translating into a 41 percent yield on cost for the conglomerate. Patient holding beats chasing quick trades every single time.
