Ty Cobb’s Estate Would Own More Coca-Cola Stock Than Warren Buffett

A noteworthy investing passage from page 155 of Charles Alexander’s book “Ty Cobb”:

“In the 1920s, Cobb’s Coca-Cola stock would prove particularly renumerative. Since his first commercial endorsements for the soft drink in 1908, Cobb had been friends with Robert W. Woodruff, who in 1923 succeeded his father as president of the Atlanta based-business. Woodruff and Cobb were frequent hunting companions, especially at the Woodruff family’s plantation in southwestern Georgia. Many people later regretted not getting in on the ground floor with Coca-Cola, as Cobb had done; but maybe none were sorrier than three sports writers whom Cobb, relaxing in New York on the evening after he was named Tigers manager, futilely urged to buy Coca-Cola at a little more than twenty dollars per share. Within a few years that stock was worth nine times as much. Cobb himself continued to buy into Coca-Cola, whose profits and operations expanded spectacularly … Read the rest of this article!

Warren Buffett The Dividend Investor

I have heard it repeated over and over again that dividends don’t matter to Warren Buffett, and therefore, should not play any meaningful role in how other investors arrange their personal affairs. This type of conclusion is based on the superficial fact that Warren Buffett prevents Berkshire Hathaway (BRK.B) from paying a regular dividend to its shareholders.

That conclusion is a bit off because it ignores Warren Buffett’s own history, his current personal circumstances, and the current incentives that he has offered for executives of Berkshire’s subsidiaries.

To understand Buffett’s own history, check out pages 338 and 339 from Alice Schroeder’s “Snowball” biography of Buffett which contains the following quote:

“As 1974 began, stocks for which he had recently paid $50 million lost a quarter of their value. Berkshire, too, slid down to $64 per share. Some of the former partners began to fear it had been a mistake to … Read the rest of this article!