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Coke raises dividend by 4% and OXY by 8%.

OXY dividend raise should loser the strike price of the warrants.

Also OXY stock up 10% on earnings report and rising oil prices on Iran invasion threat.

Altogether a good day for BRK, even though share drops 0.5 %.

On a separate note, AXP may become the largest equity investment if Apple share sales continue.

With Berkshire having 400 million shares (!!!) of KO that's $848 million in annual dividends every year or $212 million per quarter, just staggering numbers.
It won't be long before they will be getting their entire original investment back ($1 billion, I believe) in dividend payments.

almost . Berkshire bought 1.2 billion worth

AI generated and not fact checked:
38 years of ownership from 1988 first purchase.
~1.3B original investment 1988-1994.
Current Market Value: ~$32B.
Dividends to date ~12.5B.

Claw back original purchase price every 19 months with dividends at 63% yield on cost.

Ownership in company has increased from ~ 7% to 9% with KO's share repurchases.

Excluding dividends the shares have a CAGR of 10.5%

If he would have reinvested all dividends the CAGR would have been 15.6%

If KO never paid a dividend and bought its own shares back instead it would have been a CAGR of 17-18% bc of better tax efficiency and BRK would probably own 20-25% of the company -- theoretically.

Some speculation and extrapolation in there.

KO $12.5B in dividends and $32B in unrealized capital gains for $44.5B total
AXP $ 5.5B in dividends and $56B in unrealized capital gains for $61.5B total

Berk ownership in KO grew from about 7% to 9% of the company.
Berk ownership in AMX grew from about 10% to 21% of the company

Currently AMEX is throwing dividends of $497M to KO's %856M

KO has been raising its dividend by about 3% a year recently while AMEX has been growing its dividend by about 15% a year recently. Many expect AMEX to continue to raise their dividend by 15% going forward -- its dividend payout ratio is about 21% of earnings. (KO's payout ratio is about 66%)


Gemini suggest most people expect AMEX to throw ~ $1.15B in dividends in 2031, and slightly more than KO's projected $1.04B that year.

APPL CAGR blew them all away for a shorter period (10 years) of time.

With Berkshire having 400 million shares (!!!) of KO that's $848 million in annual dividends every year or $212 million per quarter, just staggering numbers.

Coke is a big company, so the numbers are big.

But don't confuse this with a successful company. Real corporate net earnings are flat since at least 2011-2012, despite the fall in tax rates. The dividend has risen because long term debt has doubled, the payout ratio has risen, and the [split adjusted] share count has fallen about 5%. Money spent on buybacks isn't available as owner earnings, so the rising EPS is illusory.

Given how badly the top level business has done, it's probably fair to say that those buybacks in the last ~15 years at (say) P/E of 19-24 for a non-growing firm have been very poor capital allocation. Often you can get owner earnings yields on non-growing cash cows of about 8-10%, not 4-5%. If someone is up to it, estimate what their value would be today if the money spent on those buybacks (I dunno, $12 bn??) had been put into QQQ or SPY or BRK, meaning the share count wouldn't have fallen nor the real EPS risen.

2025 will probably look good measured in US dollars because they export a lot and the non-US revenue seems a bigger number when the dollar falls. Probably their biggest charm as an investment.

It's still a fine holding for Berkshire as a substitute for a near-perpetual inflation protected bond. Since the retained earnings are merely letting the firm keep up with inflation, the owner earnings yield is only the dividend yield, currently 2.59%. 30 year TIPS are offering 2.47%, and it was 2.65% a couple of weeks ago. But I suspect management is smart enough not to buy it today. They have certainly taken every opportunity NOT to add to the position for many many years.

Jim

" Given how badly the top level business has done, it's probably fair to say that those buybacks in the last ~15 years at (say) P/E of 19-24 for a non-growing firm have been very poor capital allocation. Often you can get owner earnings yields on non-growing cash cows of about 8-10%, not 4-5%. If someone is up to it, estimate what their value would be today if the money spent on those buybacks (I dunno, $12 bn??) had been put into QQQ or SPY or BRK, meaning the share count wouldn't have fallen nor the real EPS risen."

Good morning, Jim, no doubt it's purely by accident but you are getting their old bud.

Now look back 20 years, how many shares of KO have been issued as a result of stock-based comp?

How many shares of brk have been issued the past 20 years for comp?

Now do you agree with what I argued 20 years ago that every share of brk is precious, valuable, and dear? Are buybacks even more significant when done by a company at reasonable valuations without stock based comp? What percent of KO would brk own today if they didn't have stock-based comp, like brk? The hurdle to buy any other company or its shares before buying back brkb should have been very high, it wasn't. The theory that Buffett could better deploy those dollars more effectively than by buying brk, was poorly reasoned. Buffett nor Charley ever understood this concept. Buy and promote brkb, not ibm, oxy, etc.

As a result of very poor capital allocation decisions the past 15 years brk has no choice but to reposition our thinking with respect to attracting new buyers, going forward.

Selling amzn is a clue that amzn was a todd pick. Holding googl might mean that was a Ted pick.

I know this is a lot for you handle in one post but I believe in you, old bud! ::))

YOU, might not be more flexible than Uncle Warren, but I have lots of patience. GO BRKB!!

What have you done for me lately Mr. Coca-Cola?

YTD KO is UP 13.8% so not too shabby & 2/3 of revenues are international so if the green back weakens a bit, it ain’t all bad.

Will be interesting to see what Greg does with this WEB “Never sell” position.

APPL CAGR blew them all away for a shorter period (10 years) of time.

At end of Q3 2023, Berkshire owned 915,560,382 Apple shares. At the time, the Apple dividend was $0.24/share. That means that Berkshire was collecting an annual dividend from Apple of about $879 million at the time.

So not only did Apple CAGR beat them all, the Apple dividend (in nominal dollars) also beat them!

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