Warren Buffett’s Longest-Held Stock: Why He’ll Never Sell Coca-Cola

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Warren Buffett’s Longest-Held Stock: Why He’ll Never Sell Coca-Cola

Warren Buffett, the CEO of Berkshire Hathaway, has held Coca-Cola Co. (NYSE: KO) stock for over 34 years and has no plans to sell it. This investment has become one of his top all-time picks and longest-held positions, with Berkshire Hathaway now owning 400 million shares of Coca-Cola stock valued at approximately $22 billion. Buffett likes Coca-Cola stock for one reason: value.

Buffett invests only if it’s the right price and not a penny more. Coca-Cola stock, at the time, was at a good price with an interesting competitive edge. Coca-Cola owns nearly 50% of the U.S. soft drink market, so as long as people are drinking soft drinks, Coke will be performing well. Additionally, Coca-Cola creates value by being a productive asset that produces cash and a product. This is something that Buffett favors in his investments.

Buffett has previously mentioned that Coca-Cola produces nearly 2 billion drink servings per day. If the company needs to produce more profit, it could raise its drink prices by just 1 cent per serving and produce an extra $20 million per day. As long as Coca-Cola maintains its market dominance, Buffett is unlikely to sell his shares.

While you’re unlikely to see those kinds of returns in Coca-Cola stock anymore because of its size, there are still value picks in the industry. For example, TruBrain is a startup that creates drinks and supplements focused on cognitive health and is currently valued at a fraction of what Coke was when Buffett invested in the company in 1988. However, Buffett's investment strategy is to look for companies that have long-term value and are not just short-term investments.

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