In this article, we will take a look at Warren Buffett’s top 5 dividend picks. To see more such companies, go directly to Warren Buffett’s $5.7 Billion Dividend Portfolio: Top 15 Picks.
5. American Express Company (NYSE:AXP)
Berkshire Hathaway’s Stake: $22.4 billion
The Oracle of Omaha has a $22.4 billion stake in American Express Company (NYSE:AXP) as of the end of the fourth quarter of 2022. In March American Express Company (NYSE:AXP) increased its quarterly dividend by 15.4%.
Earlier this year Morgan Stanley gave bullish comments for American Express Company (NYSE:AXP) and added the stock in the list of its top picks for 2025. The firm said it believes slowing growth in expenses related to marketing and card member acquisition could help American Express Company (NYSE:AXP) drive about 430bp operating leverage growth in 2023. Morgan Stanley thinks this operating leverage growth trajectory could continue in 2024 as well.
4. The Coca-Cola Company (NYSE:KO)
Berkshire Hathaway’s Stake: $25.4 billion
The Coca-Cola Company (NYSE:KO) is one of the most sought-after dividend stocks since the company has upped its dividend for six decades without break. In April, The Coca-Cola Company (NYSE:KO) posted its first quarter results according to which its adjusted EPS came in at $0.68, beating estimates by $0.03. Revenue in the quarter jumped about 4.8% year over year to $11 billion, beating estimates by $220 million.
Out of the 943 hedge funds tracked by Insider Monkey, 58 hedge funds were long KO as of the end of the fourth quarter of 2022.
3. Chevron Corporation (NYSE:CVX)
Berkshire Hathaway’s Stake: $29.3 billion
Warren Buffett’s Berkshire has a whopping $29 billion stake in oil giant Chevron Corporation (NYSE:CVX) as of the end of the fourth quarter of 2022. With over three decades of consistent dividend increase, Chevron Corporation (NYSE:CVX) is one of the most reliable dividend stocks out there.
Other hedge funds were also piled into Chevron Corporation (NYSE:CVX) at the close of 2022. 57 hedge funds (including Berkshire) tracked by Insider Monkey had stakes in the company. The total worth of these stakes was over $32 billion.
2. Bank of America Corporation (NYSE:BAC)
Berkshire Hathaway’s Stake: $33.5 billion
Bank of America Corporation (NYSE:BAC) remains the favorite bank stock of Warren Buffett. The Oracle of Omaha said during the 2023 shareholders meeting that there’s a lot of uncertainty in the banking sector amid the current crisis, but he continues to stick with Bank of America Corporation (NYSE:BAC).
“We’re very cautious… about ownership of banks and we do remain with one bank… I like Bank of America and I like the management,” Buffett said.
As of the end of 2022, Berkshire Hathaway had owned $33 billion stake in Bank of America Corporation (NYSE:BAC).
Bank of America Corporation (NYSE:BAC) has upped its dividend for five decades.
Oakmark Equity and Income Fund made the following comment about Bank of America Corporation (NYSE:BAC) in its Q1 2023 investor letter:
“The Oakmark Equity and Income Fund has 29% of its equity portfolio in financials. This made the March sell-off painful, but we do not believe that this has meaningfully changed the value of most of our financial equity holdings. In fact, we were adding to financial positions throughout March. We believe that one way to analyze our financial holdings is to look at them in different buckets given their various business models and risk profiles. Almost 30% of our financial exposure is in insurance companies and insurance brokers. Insurance companies have very stable liability profiles, so the main risk is a change in asset values. We are comfortable with their investment portfolios and think these stocks are quite attractive. Around 5% of our financials are asset managers. This leaves a little over 40% of the financials exposure in a varied group of banks and lenders. About 5% of that portfolio is in Bank of America Corporation (NYSE:BAC) and State Street. These two banks are designated as Systematically Important Financial Institutions and are held to higher regulatory standards. Our largest single financials holding is Bank of America, which has grown deposits during March, and we believe it is one of the best managed companies in the sector.”
1. Apple Inc. (NASDAQ:AAPL)
Berkshire Hathaway’s Stake: $116.3 billion
Warren Buffett’s has long been a believer in Apple Inc. (NASDAQ:AAPL). As of the end of the last quarter of 2022, Apple Inc. (NASDAQ:AAPL) accounted for about 38% of Berkshire’s entire portfolio. Apple Inc. (NASDAQ:AAPL) started paying dividends in 2012 and has since upped its dividend every year. According to a latest report from Bloomberg, Apple Inc. (NASDAQ:AAPL) is expected to initiate a new five-part debt offering to raise $5 billion.
As of the end of the last quarter of 2022, 135 hedge funds were long Apple Inc. (NASDAQ:AAPL), according to Insider Monkey’s proprietary database of 943 hedge funds
RiverPark Large Growth Fund made the following comment about Apple Inc. (NASDAQ:AAPL) in its Q1 2023 investor letter:
“Apple Inc. (NASDAQ:AAPL): Apple shares were our final top contributor for the quarter. While the company reported a rare quarterly earnings miss, investors had expected slower sales due to macro headwinds. Services continue to be a bright spot for the company with an all-time high of $21 billion in quarterly revenue, a 6% year-over-year increase, and management expects iPhone revenue growth to re-accelerate in 2Q. Operating Cash Flow was $34 billion for the quarter, and the company returned $23 billion to shareholders in the last three months, including $4 billion in dividends and $19 billion in share repurchases.
With an installed base of 2 billion active devices and significant growth of the company’s recurring revenue Services segment (now 18% of revenue), we believe that Apple remains one of the most innovative, best-positioned and most profitable companies in the mobile technology industry.”
You can also take a peek at 10 Most Profitable Small Businesses in 2023 and 10 Best April Dividend Stocks To Buy.
