Warren Buffett Paid About $1.3 Billion for Berkshire's Coca-Cola Shares. They're Now Worth About $37 Billion.
Key PointsBerkshire's annual Coca-Cola dividends now equal around 65% of what it spent on the shares.
In August 1994, Warren Buffett spent approximately $1.3 billion on Coca-Cola shares, which are now valued at around $37 billion. At the time, Buffett owned all 400 million shares, and by June of that year, the investment was already yielding $848 million annually, thanks to Coca-Cola's dividend. This yield was about 65% of the original investment.
In 2022, the yearly dividend from Coca-Cola had risen to $704 million, and by 2025, it reached $816 million. Coca-Cola's quarterly dividend was recently increased to $0.53 per share, marking its 64th consecutive annual increase. However, the growth rate has slowed down. Originally, Buffett received a dividend yield of around 5.8%, which has now decreased to a more modest 2.3%.
While Coca-Cola's business has shown growth, with organic revenue increasing by 6% in the second quarter of 2026 and EPS up 11% year-over-year, the stock's valuation has also risen significantly. Today, the stock trades at around 29 times its adjusted earnings for the last four quarters, up from 23 times at the end of 2025, and it commands a price-to-earnings ratio of about 26.
This higher valuation suggests that a new buyer might need more than just the strong dividend growth to justify the purchase. The dividend alone might not be enough to justify the current price.
Written by urgent.news from Motley Fool's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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