Warren Buffett, the chairman of Berkshire Hathaway (NYSE: BRK.A), is widely regarded as one of the best investors in history.
In particular, Buffett is a big fan of dividend-paying stocks, which comprise the majority of his portfolio, with these stocks have consistently remained in his portfolio for decades due to their strong financial performance and regular dividend payouts.
Years of accumulating shares from these companies have generated a hefty annual check, now worth almost $5 billion solely in dividends.
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This highlights the power of compound investing, where the value of a stock is measured not only by its intrinsic market value but also by its dividend payouts and their amounts.
Some of the well-known companies provide the biggest dividends to Buffett
Companies like Bank of America (NYSE: BAC), Chevron (NYSE: CVX), Apple (NASDAQ: AAPL), Coca-Cola (NYSE: KO), and American Express (NYSE: AXP) together make up over 70% of Buffett’s portfolio with over 2 billion in combined shares that are worth over $250 billion and all are dividend-paying stocks.
Their dividends make up 50% of the annual check Buffett receives and are known for a history of dividend payouts spanning decades (barring Apple, which only recently started paying out dividends).
Buffett’s latest acquisition is also paying out dividends
A holding for which the Sage of Omaha got special permission from the SEC to keep it secret for the first six months since the initial investment, Chubb (NYSE: CB) is also paying out dividends, which amount to $0.86 quarterly per share.
Considering that he holds almost 26 million CB shares worth over $6.7 billion, they are projected to bring in an impressive $89 million this year.
Buffett’s history of preference for dividend-paying stocks and his latest acquisition only shows how much importance he places on this fact when choosing his new purchase.
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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
