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3 Stocks Warren Buffett Refuses to Let Go Of

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  • One of the reasons Warren Buffett is so successful is because he has a long-term investment horizon that’s represented by his mantra, “the best time to sell is never.”
  • Procter & Gamble (PG): The consumer products giant has a portfolio of well-known brands that consumers return to again and again.
  • American Express (AXP): The premiere credit card company targets high-income individuals, making it the perfect stock for all kinds of market conditions.
  • Coca-Cola (KO): Buffett has been a fan of the soda giant for years, not just in the stock market, but in the pantry, as the Oracle famously drinks several Cherry Cokes daily.
Warren Buffett Stocks - 3 Stocks Warren Buffett Refuses to Let Go Of

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Warren Buffett is known for his buy-and-hold investing philosophy. He famously once said, “The best time to sell is never.” The strategy paid off handsomely for Berkshire Hathaway (NYSE:BRK-A, NYSE:BRK-B) shareholders. This has led to the emergence of famous Warren Buffett stocks

The Oracle of Omaha generated 3.7 million percent returns for them since becoming chairman of the company in 1965. That’s a near 20% annual return for that 57-year period, or double those of the S&P 500.

Now Buffett doesn’t unwaveringly follow a buy-and-never-sell strategy. Earlier this year he completely exited his position in Taiwan Semiconductor Manufacturing (NYSE:TSM) only a year after establishing a position in the stock due to geopolitical concerns. He’s also been in and out of airline stocks over the years.

Yet buy-and-hold is the ideal when it comes to Warren Buffett stocks. You want to buy companies so good you never want to sell them.

And the Oracle has quite a few stocks he owns that seem to fit that criteria. What follows are three Warren Buffett stocks bought over a decade or more ago and he still owns them today.

Procter & Gamble (PG) 

A concept image showing wooden blocks with a yellow arrow pointing up.
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Buffett’s ownership stake in consumer products giant Procter & Gamble (NYSE:PG) is rather long and convoluted. He’s also sold shares numerous times over the years, but has always maintained a position in the company. Today, Buffett’s 315,400 shares are worth $47.9 million, according to Berkshire Hathaway’s latest 13F filing.

The Oracle came about by owning Procter & Gamble shares by way of Gillette. He bought the razor maker’s preferred stock back in 1989, which eventually got called and converted into 12 million common shares.That was good for an 11% stake in the business. 

Some 16 years later, Procter & Gamble bought Gillette giving Buffett his first position in the consumer products company. He ended up buying 100 million shares more, only to significantly pare down his stake a few years later. The financial crisis had Buffett buying into Goldman Sachs (NYSE:GS), General Electric (NYSE:GE), and others to bail them out.

He sold off almost all of his stake in P&G in 2014 when he opted to outright buy its Duracell battery business its had acquired when it bought Gillette. What he owns today are the remnants of that transaction 18 years ago.

He receives about $1.1 million annually from Procter & Gamble’s dividend, which yields 3.9% annually.

American Express (AXP) 

a pile of credit cards
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Credit services provider American Express (NYSE:AXP) is the second oldest stock in the Berkshire Hathaway portfolio. Buffett bought his first shares in 1991, some with a $300 million purchase of preferred shares. By the end of the decade owned more than 50 million shares.

Although Buffett has not bought a single share since then, American Express has grown to occupy the fourth biggest position in Berkshire Hathaway. Today he owns over 151 million shares worth some $22.6 billion today. That’s the power of converting preferred shares into common shares and compounding them over time.

Buffett has said the credit company is a one of a kind business. “You can’t create another American Express,” he told Bloomberg last December. It’s why he hasn’t let go of the stock even if he hasn’t bought any more.

American Express primarily targets higher-income individuals. Economic conditions affect them less or later than others. That gives the credit card company resilience through all kinds of market conditions.

The credit services firm also possesses another feature Buffett loves: it pays a dividend. He collects about $361 million a year in dividend payments from the payout that yields 3.85% currently.

Coca-Cola (KO) 

Coca-Cola Consolidated sign outside of their building. COKE Stock.
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The stock Buffett has owned the longest is none other than Coca-Cola (NYSE:KO). The Oracle of Omaha first bought it in 1988 and the 400 million shares he amassed over time represent over 9% of Coke’s total shares outstanding. At $21.2 billion, it accounts for just under 7% of Berkshire Hathaway’s total value.

Buffett famously switched from drinking Pepsico (NASDAQ:PEP) soda to Cherry Coke in the 1980s after the company sent him a can. He then began buying the stock and now he drinks several cans of the beverage daily.

While Coca-Cola was deemed “the world’s most valuable non-alcoholic drink” brand worth $33.5 billion last year, it also holds other benefits too. Its relative affordability makes it resilient in a downturn. Consumers continue buying it during economic crises because they don’t feel they’re busting their budgets.

Those 400 million shares Buffett owns also rake in nearly three-quarters of a billion dollars in dividend payments each year, too.

On the date of publication, Rich Duprey held a LONG position in KO and PG stock. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.


Article printed from InvestorPlace Media, https://investorplace.com/2023/10/3-stocks-warren-buffett-refuses-to-let-go-of/.

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