Unveiling Warren Buffett’s Time-Tested High-Yield Stocks

by Fred Fuld III

Warren Buffett, renowned as the Oracle of Omaha, is celebrated for his long-term investment strategy, which often centers around high-quality, dividend-paying stocks in the Berkshire Hathaway (BRK-A) (BRK-B) portfolio. While Buffett’s portfolio encompasses a diverse array of investments, several high-yield stocks have consistently stood out. Listed below are three of his highest yielding stocks in his portfolio. 

Kraft Heinz Company (KHC)

The dividend yield for The Kraft Heinz Company (KHC) stands at 4.59%. With a payout ratio of 68.83%, close to 69% of KHC’s earnings are disbursed to shareholders through dividends. KHC’s annual dividend payout amounts to $1.60 per share. The Price to Book ratio is an excellent 0.86, and the Price to Sales ratio is right in the mid range at 1.71, but the Price to Earnings Growth ratio (PEG ratio) is on the high side at 3.55. The stock makes up 3.47% of Berkshire’s total portfolio.

The ex-dividend date for The Kraft Heinz Company (KHC) is March 7, 2024. Investors purchasing shares on or after this date will not qualify for the upcoming dividend payment. The company follows a quarterly dividend payment schedule, with the next distribution planned for March 29, 2024. 

CLICK HERE FOR DIVIDEND HISTORY

Coca-Cola Company (KO)

The dividend yield for The Coca-Cola Company (KO) currently stands at 3.26%. With a payout ratio of 74.22%, approximately three-quarters of KO’s earnings are allocated to shareholders in the form of dividends. Coke’s annual dividend payout amounts to $1.94 per share. The Price to Book ratio is on the very high side at 9.88. The Price to Sales ratio is also very high at 5.56, along with the Price to Earnings Growth ratio (PEG ratio) at 3.88. The stock currently makes up 6.79% of Warren Buffett’s total portfolio.

The ex-dividend date for The Coca-Cola Company (KO) is March 14, 2024. Investors purchasing shares on or after this date will not qualify for the forthcoming dividend payment. The company follows a quarterly dividend payment schedule, with the next distribution scheduled for April 1, 2024. 

CLICK HERE FOR DIVIDEND HISTORY

Chevron Corporation (CVX)

The dividend yield for Chevron Corporation (CVX) currently sits at 4.35%. CVX has a payout ratio of 53.05%. Slightly more than half of CVX’s earnings are allocated to shareholders in the form of dividends The annual dividend payout amounts to a whopping $6.52 per share. The Price to Book ratio is a reasonable 1.74. The Price to Sales ratio is right in the mid range at 1.41, but the Price to Earnings Growth ratio (PEG ratio) is on the low side at an excellent 0.81. The company represents 5.41% of Berkshire Hathaway’s total portfolio.

The ex-dividend date for Chevron Corporation (CVX) is February 15, 2024. Investors purchasing shares on or after this date will not qualify for the upcoming dividend payment. The company follows a quarterly dividend payment schedule, with the next distribution planned for March 11, 2024. 

CLICK HERE FOR DIVIDEND HISTORY

Overall, high-yield stocks play a crucial role in income generation, portfolio diversification, and long-term wealth accumulation strategies, making them important considerations for investors with varying financial goals and risk tolerances.

Remember, as a rule of thumb, if the P/B ratio, the P/S ratio, and the PEG ratio, is below one, that is good, if it is between one and two is considered average, and above two, it may be on the high side. Some of these ratios may be irrelevant for high growth stocks.

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Warren Buffett’s Berkshire Hathaway Generates $43.7 Billion Loss

FOR IMMEDIATE RELEASE

Omaha, NE (BRK.A; BRK.B) –

August 6, 2022

BERKSHIRE HATHAWAY INC. NEWS RELEASE

Berkshire’s operating results for the second quarter and first six months of 2022 and 2021 are summarized in the following paragraphs. However, we urge investors and reporters to read our 10-Q, which has been posted at www.berkshirehathaway.comThe limited information that follows in this press release is not adequate for making an informed investment judgment.

Earnings of Berkshire Hathaway Inc. and its consolidated subsidiaries for the second quarter and first six months of 2022 and 2021 are summarized below. Earnings are stated on an after-tax basis. (Dollar amounts are in millions,

Generally Accepted Accounting Principles (“GAAP”) require that we include the changes in unrealized gains/losses of our equity security investments as a component of investment gains/losses in our earnings statements. In the table above, investment gains (losses) in 2022 include losses of $53.0 billion in the second quarter and $53.8 billion in the first six months and in 2021 include gains of $21.0 billion in the second quarter and $23.8 billion in the first six months due to changes during the second quarter and the first six months in the unrealized gains that existed in our equity security investment holdings. Investment gains (losses) in 2022 also include after-tax realized gains on sales of investments of $44 million in the second quarter and after-tax realized losses of $568 million in the first six months and in 2021 include after-tax realized gains on sales of investments of $183 million in the second quarter and $1.6 billion in the first six months.

The amount of investment gains/losses in any given quarter is usually meaningless and delivers figures for net earnings per share that can be extremely misleading to investors who have little or no knowledge of accounting rules.

An analysis of Berkshire’s operating earnings follows (dollar amounts are in millions).
Second Quarter First Six Months

Approximately $1.0 billion was used to repurchase Berkshire shares during the second quarter of 2022, bringing the six-month total to $4.2 billion. At June 30, 2022, insurance float (the net liabilities we assume under insurance contracts) was approximately $147 billion, relatively unchanged from yearend 2021.

Use of Non-GAAP Financial Measures

This press release includes certain non-GAAP financial measures. The reconciliations of such measures to the most comparable GAAP figures in accordance with Regulation G are included herein.

Berkshire presents its results in the way it believes will be most meaningful and useful, as well as most transparent, to the investing public and others who use Berkshire’s financial information. That presentation includes the use of certain non-GAAP financial measures. In addition to the GAAP presentations of net earnings, Berkshire shows operating earnings defined as net earnings exclusive of investment and derivative gains/losses and impairments of goodwill and intangible assets.

Although the investment of insurance and reinsurance premiums to generate investment income and investment gains or losses is an integral part of Berkshire’s operations, the generation of investment gains or losses is independent of the insurance underwriting process. Moreover, as previously described, under applicable GAAP accounting requirements, we are required to include the changes in unrealized gains/losses of our equity security investments as a component of investment gains/losses in our periodic earnings statements. In sum, investment gains/losses for any particular period are not indicative of quarterly business performance.

About Berkshire

Berkshire Hathaway and its subsidiaries engage in diverse business activities including insurance and reinsurance, utilities and energy, freight rail transportation, manufacturing, retailing and services. Common stock of the company is listed on the New York Stock Exchange, trading symbols BRK.A and BRK.B.

Cautionary Statement

Certain statements contained in this press release are “forward looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are not guaranties of future performance and actual results may differ materially from those forecasted.

Warren Buffett’s Recent Stock Portfolio Changes

by Fred Fuld III

Warren Buffett, head of Berkshire Hathaway (BRKA) (BRKB), is one of the richest men in the world and one of the most followed investment professional.

Many long term investors pay close attention to his stock moves and the Berkshire Hathaway stock portfolio, and often follow in his footsteps.

Here are his recent changes:

He sold off over 57 million shares of Apple (AAPL), but the stock still makes up over 43% of his portfolio and his largest holding.

He added 88 million shares of Verizon (VZ) to his current holdings in the company.

He sold off more than 800,000 shares of US Bancorp (USB), but still owns131 million  shares.

He added 4 million shares of Chevron (CVX) to his current stockholdings.

He reduced his General Motors holdings (GM) by 7.5 million shares.

He sold off a substantial amount of his holdings in Wells Fargo (WFC), about 75 million shares.

He bought more shares of Abbvie (ABBV), Merck (MRK), Kroger (KR), Restoration Hardware (RH), T-Mobile (TMUS), Marsh & McLennan (MMC), and Bristol-Myers Squibb (BMY).

He sold 5 million shares of Suncor (SU).

Finally, he closed out his entire positions in JP Morgan Chase (JPM), M&T Bank (MTB), Barrick Gold (ABX), PNC Financial (PNC), and Pfizer (PFE).

To se Warren Buffett’s portfolio, click HERE. Let’s see if you can outperform Warren Buffett this year.

 

Disclosure: Author owns AAPL, MRK, and PFE.

Investment Books Recommended by Warren Buffett

Warren Buffett, head of Berkshire Hathaway (BRKA) (BRKB), really came out with a list of books that he recommends on how to invest.

At last year’s Berkshire Hathaway annual meeting, Buffett actually provided such a list. The books he recommended about himself can be found here and here.

However, if you are interested in reading books about how to invest, that are recommended by Warren Buffett, they can be found on the list below:

Business Adventures Twelve Classic Tales from the World of Wall Street

Common Sense on Mutual Funds: Fully Updated 10th Anniversary Edition

The Great Crash 1929

The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel (Revised Edition)

Investing Between the Lines: How to Make Smarter Decisions By Decoding CEO Communications

Happy Reading!

 

 

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Books that Warren Buffett Recommends about Himself Part 2

Vlast month, we published a list of books that Warren Buffett recommends about himself.

At last year’s Berkshire Hathaway annual meeting, Buffett actually provided such a list. Here are more books that he recommends about himself.

My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World’s Most Successful Investor

 

The Oracle & Omaha, How Warren Buffet and His Hometown Shaped Each Other

 

Tap Dancing to Work: Warren Buffett on Practically Everything, 1966-2013

 

Warren Buffett on Business: Principles from the Sage of Omaha

 

Warren Buffett’s Ground Rules: Words of Wisdom from the Partnership Letters of the World’s Greatest Investor

Warren Buffett Speaks: Wit and Wisdom from the World’s Greatest Investor

Enjoy your summer reading!!!

Books that Warren Buffett Recommends about Himself

Yes, Warren Buffett, head of Berkshire Hathaway (BRKA) (BRKB), actually comes out with a list of books that he recommends, and he even recommends books about himself.

At last year’s Berkshire Hathaway annual meeting, Buffett actually provided such a list. Here are his recommended books about himself.

Berkshire Beyond Buffett: The Enduring Value of Values

 

Berkshire Hathaway Letters to Shareholders

 

50 Years of Berkshire Hathaway Wall Print
This is actually a wall print poster.

 

Buffet: The Making of an American Capitalist

 

Buffett’s Bites: The Essential Investor’s Guide to Warren Buffett’s Shareholder Letters

 

The Essays of Warren Buffett: Lessons for Corporate America, Fifth Edition

 

A Few Lessons for Investors and Managers From Warren Buffett

Happy reading!

 

 

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What Warren Buffett has been Selling

by Fred Fuld III & Nkem Iregbulem

As the fourth-wealthiest person in the world, Warren Buffett is widely regarded as an investment guru. His investment philosophy is based on the concept of value investing. He is the chairman, CEO, and largest shareholder of Berkshire Hathaway, the world’s 10th largest company by revenue. As of 2018, Buffett is estimated to be worth about $89 billion. He is not only an investor but also a dedicated philanthropist. In fact, he has promised to give 99% of his fortune to charitable causes.

Due to his success, Buffett’s stock purchases and sales are closely followed by many other investors. Buffett’s Berkshire Hathaway (BRKA) (BRKB) recently sold 13 million shares of Delta Air Lines (DAL) and 2.3 million shares of Southwest Airlines (LUV), lightening the exposure to the airline industry.

If you want to see a list of all of Warren Buffett’s Berkshire Hathaway Holdings, click HERE.

Hopefully, one of the richest men in the world can give you some profitable investment ideas.

Disclosure: Author didn’t own any of the above at the time the article was written.

Warren Buffett Sold 750,000 Shares of Apple, But It’s Still His Largest Holding

by Fred Fuld III

Famous investor and multi-billionaire Warren Buffett has sold over 750,000 shares of Apple (AAPL) during the latest reported quarter, however it is still the largest holding in his Berkshire Hathaway (BRKA) (BRKB) stock portfolio.

As a matter of fact, Apple makes up 26% of the Berkshire portfolio. He probably didn’t want to get too overweighted in the stock. He first started buying Apple shares near the beginning of 2016 at an average cost of about 150 per share.

Buffett also dumped shares of another stock, Wells Fargo (WFC). He liquidated over 31 million shares of the company, so now the stock makes up less than 9% of the Berkshire portfolio.

The Oracle of Omaha made no changes to the second and third largest holdings, Bank of America (BAC), and Coca-Cola (KO). Same with the fifth largest, American Express (AXP).

It is interesting to note that the above five mentioned stocks make up over 65% of the total Berkshire Hathaway stock portfolio.

If you want to see a list of all the stocks in Warren Buffett’s Berkshire Hathaway stock portfolio, you can go to the following link:

Warren Buffett Berkshire Hathaway Stocks

 

Disclosure: Author owns AAPL, BRKB, BAC, & KO.

 

Here’s How You Can Have Lunch With Warren Buffett

by Fred Fuld III

All Warren Buffett fans would like to have lunch with one of the greatest investors in the world. Would you like to have lunch with Buffett? Besides eating with Buffett, the head of Berkshire Hathaway (BRKA) (BRKB), you get to ask him lots of questions and get his advice.

The catch is to be the successful bidder for the eBay (EBAY) auction of the Power Lunch with Warren Buffett to Benefit GLIDE. The current bid at the time this article was written is $3,500,100.00. There have been 13 bids so far and the starting bid was $25,000.

Buffett will have a meal with the winning bidder and up to seven friends at Smith & Wollensky in New York City on a mutually agreed upon date.

All of proceeds from the winning bid will benefit GLIDE, one of the leading social service institutions working to alleviate human suffering and poverty in the San Francisco Bay Area.

You have two days left to bid, as the auction closes on Friday, May 30, 2019 at 7:30 pm PT. You must be prequalified to bid.

Don’t forget to read:

How to Plan for Warren Buffett’s Berkshire Hathaway Annual Shareholders Meeting

How to Plan for Warren Buffett’s Berkshire Hathaway Annual Shareholders Meeting

by Fred Fuld III

It was just a couple weeks ago when Warren Buffett held his Berkshire Hathaway (BRKA) (BRKB) Annual Shareholders Meeting in Omaha, Nebraska. The attendance was huge. I understand that they expected around 30,000 attendees, but according to the local press, there were over 40,000! It was like a rock concert festival for investors.

The event was held at the CHI Health Center Omaha Convention Center and Arena. The arena part of the center, which normally hosts basketball and hockey games, was where the meeting was held and the the convention center held the exhibiters of many of the companies that Berkshire Hathaway owns.

It was a three day event starting with the Shareholder Shopping Day and Borsheims Cocktail Reception on Friday, May 3.

Then on Saturday was the all-day annual meeting, starting with a movie about some of the products and services offered by Berkshire companies. After the movie was a question and answer session with Warren Buffett and Charlie Munger, which lasted all day long, other than a one hour lunch break. I don’t know how Warren and Charlie had the stamina. By two o’clock in the afternoon, I felt like taking a nap (but I didn’t).

After the Q&A, the formal meeting began and lasted about two minutes. Finally, during the evening was the Nebraska Furniture Mart’s Berkshire Picnic.

Sunday was the Berkshire Hathaway “Invest in Yourself” 5K Walk, Jog, and Run. Then the Borsheims Shopping Day took place where an entire indoor shopping center was taken over for the day and opened exclusively to Berkshire shareholders. In addition to the free food, you could watch bridge champions, a table tennis champion, a magician, and music entertainment. Finally, the dinner at Gorat’s Steakhouse.

Berkshire Boat
You could have bought this boat. Price: $165,000. Show special: $125,000

In regards to the exhibits in the convention center, attendees could visit the following:

  • Borsheims Fine Jewely
  • BNSF Railway (with a toy train moving around the exhibit) Train
  • Coca-Cola (KO)
  • Dairy Queen (lots of inexpensive ice cream)
  • FlightSafety International (which allowed attendees to try out the company’s flight simulation machines)
  • GEICO (a giant GEICO gecko was there)
  • Kraft Heinz (KHC)
  • NetJets (you could walk through the interior of a jet)
  • See’s Candies (probably the most popular exhibit)
  • and many, many more exhibitors

For those of you that want to attend next year, here are some things to keep in mind:

  1. Next year’s meeting is May 2, 2020
  2. If you don’t own shares of Berkshire, make sure you buy your shares far enough ahead of time to be on the corporate records so that you will be entitled to attend
  3. Make your reservation for a hotel room NOW. I made my reservation about a couple months before the event, and the closest hotel I could get was over half an hour away from the convention center.
  4. If you plan on taking Lyft (LYFT) or Uber (UBER) at the airport when you first arrive, plan on not getting a car for a long, long time. I suggest that you immediately stand in the taxi line, and call Lyft or Uber right after you get in line (which may take at least half an hour to get to the front for a taxi). You may be lucky and your ride hailing car may show up before you get to the front of the taxi line. Expect to pay a lot for a taxi ride, far more than Uber or Lyft.
  5. If you want to get a good seat at the meeting, plan on getting there very, very early in the morning. I arrived at 7:45 am and it was already standing room only. (Remember, this is an arena.) I finally got a seat in the afternoon up in the nosebleed section. I was talking to the guy who was sitting behind me and he said he got there at 6:15 and it was the best seat he could get. He told me that people started arriving at 3:30 and 4:00 in the morning in order to get a decent seat.
  6. Expect to got through extensive security to get in. I saw a police officer with an assault rifle.
  7. If you want to attend the Gorat’s Steakhouse dinner, make your reservation now.
  8. You will receive a form from Berkshire asking if you are planning to attend the meeting. Fill out the form and send it in immediately. (Tip: You can save a couple days by downloading the form instead of waiting for it to arrive in the mail.)
  9. Plan on meeting a lot of people from around the world and have fun.

Buffett and FredDisclosure: Author owns BRKB.