Warren Buffett’s Coca-Cola Dividends

When Warren Buffett purchased Coca-Cola stock, a purchase that took place between 1987 and 1994 with the most intensive buying occurring in 1988 and 1989, he managed to acquired 400 million shares at an average price of $3.25 per share. Discussions of this successful investment focus on the fact that the $3.25 has grown into $42 over a 20+ year time span.

What gets less attention are the dividend payouts which are sent to Berkshire’s headquarters as cold, hard cash. Every 90 days, Warren Buffett receives 10% of his initial purchase price back when he gets sent a check for $140,000,000.

The superficially exciting number will be when Coca-Cola’s quarterly dividend hits or crosses the $0.8125 mark sometime in the early 2020s. That will mark the moment when Berkshire Hathaway shareholders collect as much in a given year from their dividends as Buffett initially made to fund the investment. … Read the rest of this article!

A Cautionary Business Investing Tale

In 1973, a man in Connecticut took out an $8,000 loan to start his own business that would provide maintenance to make-up air units at commercial locations. Through grit expressed by his willingness to work hours and provide sophistication in the field of commercial infrastructure, he was able to diversify his business operations to include office fit-outs, electrical design builds, and security lighting to the residents of New Haven, Connecticut over the years.

He sold his business for $18 million in 2014 and effectively retired on the advice of an accountant who sensed that the valuation for his business was at the high point of the cycle.

A few months ago, I got an e-mail from this man’s widow telling me that he grew bored and depressed after he sold his business and lacked a purpose in life. She gave me permission to discuss his story broadly to inform the … Read the rest of this article!