Berkshire Hathaway (NYSE: BRK-B) maintains a 9.32% stake in Coca-Cola. The holding company itself pays no dividend, preferring to reinvest earnings and buy back stock, yet generates significant dividend income across its equity portfolio.
How Much Buffett Is Collecting From Coca-Cola
Berkshire Hathaway owns approximately 400 million shares of Coca-Cola. With Coca-Cola paying an annual dividend of $2.04 per share, that stake generates roughly:
400,000,000 shares × $2.04 = $816 million per year
That breaks down to about $204 million every quarter flowing from Coca-Cola to Berkshire.
For a single stock position, that level of income is extraordinary. Coca-Cola has effectively become a steady cash-producing asset inside Berkshire’s portfolio, sending more than three-quarters of a billion dollars annually to the conglomerate without requiring Buffett to sell a single share.
The Power of Yield on Cost
Buffett’s long-term investment approach with Coca-Cola demonstrates the compounding power of dividend growth over decades. The stock’s market value has multiplied many times over, while the dividend growth illustrates the compounding machine Buffett built through patient capital allocation.
Coca-Cola has raised its dividend for 63 consecutive years, earning Dividend King status. The most recent increase came in 2025, when the quarterly payout rose 5.2% from $0.485 to $0.51 per share. Over the past five years, the dividend has climbed from $1.60 in 2019 to $2.04 in 2025 – a 27.5% cumulative increase.
The SNOWBALL pays no dividend, preferring to reinvest earnings and buy back stock, yet generates significant dividend income across its equity portfolio.
If you think that you know better than W.B. and Benjamin Graham. GL
If you look at the chart of CTY, the long term direction is up, with inflation it will always be so. The market downturns are shown, which you have to sit thru. Better if you can add cash to the Snowball but for this example it’s only the earned dividends that are re-invested.
Looking at the chart and especially during the covid crash, you will see the share price follows the NAV of its constituent holdings. Whilst unpleasant, out of adversity comes opportunity.
Trading tip: watch the NAV not the price.
You decide to stick to your plan and simply trade the adversity and re-invest your dividends, therefore earning more dividends every year to either re-invest or to use in your retirement.
When the price is high and therefore the yield is lower, you could re-invest the dividends in the higher yielding shares in your Snowball.
The example share used is CTY which is a Dividend Hero and therefore one of the safest shares in the Investment Trust universe. CTY has reserves to pay their dividends in times of extreme market stress, which they have had to use three times in their long history but no dividend is entirely ‘safe’.
You did not have to take a big gamble with your hard earned, just to be in the right shares and do nothing.
The current yields maybe too low to include in your Snowball, unless you pair trade it with a higher yielder and still earn a blended yield of around 7%
Before we go back to the future and look at CTY during the covid crash, looking at the return on capital, investing is going to get a lot more difficult, maybe that could explain the latest interest in buying shares that pay a dividend as that may make up most of any returns.
The dividend was 19p, so when the price was 440p the yield was 4.3%.
After the price fell to 300p the yield was 6.3%, without the benefit of hindsight you had no way of knowing if the price was going to continue to fall but you could have bought the yield, as the intention was to hold forever.
The current dividend has gently risen to 21.6p, a yield on buying price of 7%, which should continue to rise as long as you hold the share.
You would have also achieved the Holy Grail of Investing, in that you could take out your stake, invest in another high yielder and continue to earn income on a share that sits in your Snowball at zero, zilch, cost.
A picture conveys a thousand words, the chart shows what turned out to be a blow out top and captures the market retrace.
The Trust owns numerous Investment Trusts that pay a dividend, so diversification away from Renewables.
The current yield is 6% and because the yield is one of the safest in the market it normally trades at a small premium, also the spread can widen.
Although a boring Trust, as traded volumes are low, it still captured a lot of last year’s price action and rose 29%, although the intention is to hold forever you could have taken out your profit and invested in another higher yielder in your Snowball.
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In time of trouble property can be a safer holding.
General guidance, not a substitute to DYOR.
Property values generally fall when interest rates rise as any future borrowing will be at a higher rate than current, therefore leaving less cash to payout in dividends.
You can buy property Trusts for discounted pounds.
Some Trusts post their NAV and therefore their discount to NAV is apparent, other REIT’s are companies and you need to compare their NAV value to their current capital value.
Any REIT with a progressive dividend policy may be worth researching around the 7% yield mark, especially if you are building a position with earned dividends as you don’t want the price to rise and the yield to fall until you have completed your buying.
RGL has been a very disappointing holding, leopards and spots but there is some research copied to the SNOWBALL which could, if you are an optimist, indicate that the worst is behind them.
AIRE, LABS are in a bid situation.
SERE has a French tax unresolved dispute, so DYOR.
NRR only pays two dividends a year, so there could be an opportunity to buy just before their xd date.
VIP sometimes trades on a wide spread.
etc., etc.
As the intention of the SNOWBALL is to hold forever, if you buy a property Trust and the value falls it’s of no consequence as long as the dividends are still paid.
A bedrock of stability But some investors weather these things better than others. And I don’t mean those who flee to cash or bonds at the first sight of trouble. Making calls like that is very, very difficult – and even the professionals have only patchy records of success.
The investors I’m talking about are those investors whose portfolios – while they might drop – fall in value nothing like the fall experienced by the broader market as a whole.
Investors whose dividend income streams continue more or less unabated, experiencing only minor turbulence, if any.
Investors who sleep easily at night, and who don’t experience that ‘sick to the stomach’ reaction every time they switch on the news, or – worse – take a look at their investment portfolios.
And who are these investors, precisely?
Investors with a solid exposure to defensive shares, in short. They might not be ‘all in’ on defensive shares – everyone likes growth, after all – but they’ve got defensive shares at the heart of their portfolios, creating a bedrock of stability and resilience.
Steady as you go So, what exactly are defensive shares? It’s not difficult.
Simply put, a defensive share is a business for which revenues – and profits – hold up pretty consistently, whatever the economic weather. Bad times, good times, and everything in between.
Clearly, that’s good news in bad times. Sales and profits continue to chug along, quite happily. Customers might be a little more price-sensitive, and perhaps not buy quite as much, but whatever the product or service that the business provides, they continue to rock up and buy it.
In short, whatever that product or service is, when it comes to customers’ budgets, it comes from non-discretionary spending.
Equally, though, there’s often less welcome news in good times. Those same customers don’t necessarily buy more of whatever it is. They might be a little less price-sensitive, and maybe buy a little bit more, but overall, demand remains fairly steady.
The charm of non-discretionary expenditure So what sort of companies, exactly, comprise defensive shares?
The key here is to think of companies that sell products or services that come from their customers’ non-discretionary expenditure. People have to eat, for instance, so a supermarket such as Tesco is a good example of a defensive share.
Food manufacturing is also in the frame, especially where there’s a decent ‘moat’ involved: Tate & Lyle would be an example, too. Unilever fits the bill, too – although the recent sale of its various food businesses (think Knorr, Marmite, Colman’s and so on) takes some of the shine off. Nevertheless, the remaining personal care portfolio is still largely defensive.
Ditto companies in the pharmaceutical and personal care sectors generally. Global giant GSK was a superb example, and is still strongly defensive, but the various consumer toothpaste and over-the-counter brands that were hived off into Haleon were a distinct loss from the standpoint of its defensive qualities. AstraZeneca and Reckitt Benckiser are also superb examples of defensive businesses.
More generally, well-chosen Real Estate Investment Trusts can possess excellent defensive qualities. Primary Health Properties, for instance, owns and leases out doctors’ surgeries – over 1,100 of them at the last count. Tritax Big Box, too, is worth a look, owning and leasing out the vast distribution centres that power the supply chains of clients such as Tesco, Amazon, Sainsbury’s, Morrisons, and Marks & Spencer.
But enough: you get the idea, I’m sure.
Boring but dependable So there we have it. In uncertain times, boring but predictable businesses that sell products or services that people dependably buy, whatever the economic climate, are a sensible underpinning for just about any portfolio – especially for older or more risk-averse investors looking for a decent income stream.
Until next time,
Malcolm Wheatley Investing Columnist, The Motley Fool UK
