Berkshire Hathaway continues to receive significant income from its long-standing stake in Coca-Cola, with the conglomerate collecting $848 million annually from the beverage company's dividend payments alone. According to the report, Berkshire Hathaway owns 400 million shares of Coca-Cola, which represents approximately 9.3% of the conglomerate's investment portfolio at the end of the second quarter.
Coca-Cola pays a quarterly dividend of 53 cents per share. Based on this rate, Berkshire Hathaway receives $212 million from the company each quarter, regardless of fluctuations in the stock's market price. This dividend stream is expected to grow, as Coca-Cola has raised its dividend annually for the last 64 consecutive years.
In February of this year, the company increased its dividend from 51 cents per share to 53 cents per share. The article notes that another increase is likely to occur between now and next February, potentially adding one to two more cents per share. Each one-cent increase in the dividend is projected to result in an additional $40 million in quarterly payments and $160 million in annual income for Berkshire Hathaway.
The report highlights that Warren Buffett began purchasing shares of Coca-Cola for Berkshire Hathaway in 1988. Although he stepped down as CEO and chairman of Berkshire Hathaway within the last 12 months, his successor, Greg Abel, has named Coca-Cola stock as one of the company's core holdings. The article suggests that Berkshire Hathaway could eventually collect more than $1 billion annually from Coca-Cola dividends as the payout continues to rise.
