Under the visionary leadership of Warren Buffett, Berkshire Hathaway has emerged as one of the most triumphant companies in history, yielding exceptional returns for long-term investors. With a staggering market capitalization of approximately $990 billion, Berkshire stands tall as one of the largest companies in the S&P 500 and the eighth-largest globally. Although Berkshire Hathaway doesn’t distribute dividends, Buffett’s team has strategically built the company’s stock portfolio around dividend-paying companies, which has significantly contributed to its market-beating performance.
Two S&P 500 dividend stocks account for a substantial 42.4% of Berkshire’s $315.4 billion stock portfolio. The first is tech giant Apple, which remains the largest position in Berkshire’s portfolio, accounting for roughly 29.4% of the company’s total stock holdings. Despite selling nearly half of its Apple stake last quarter, Berkshire still owns 400 million shares of the company’s stock. Apple’s modest dividend yield of 0.4% may not seem impressive, but it generates substantial income for Berkshire. With its quarterly dividend sitting at $0.25 per share, Apple is poised to deliver $400 million in dividend income for Buffett’s company over the next year, even without a payout increase.
The second dividend-paying stock is American Express, which accounts for 13% of Berkshire’s portfolio. As one of Buffett’s longest-held stocks, American Express is renowned for its global brand and dividend. The company’s closed-loop system, which funds its own credit cards, generates significant cash flows, while its membership model ensures customer loyalty and profitability. American Express has paid a dividend since 1989, and it has grown 169% over the past decade, yielding 1% at the current price.
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