Warren Buffett's top holdings within Berkshire Hathaway (BRK-A) have consolidated over time. Berkshire Hathaway's top five holdings accounted for roughly 75% of the company's entire portfolio value, as of Dec. 31 2022, Apple (AAPL) is the largest holding accounting for 38.9% of the portfolio's value. Bank of America (BAC) represents 11.19% while Chevron (CVX) falls just under 10%. The majority of those purchases were made by Berkshire within the last decade, driving a more than 200% return for shareholders during that time period.
Berkshire's fourth and fifth highest holdings are famous Buffett buys. Coca-Cola (KO), which Berkshire bought in 1988, represents 8.51% of the portfolio while American Express (AXP), an equity Buffett began buying in the 1960s, is 7.49% of Berkshire's portfolio value. Buffett bought Coca-Cola and Freddie Mac in 1988, telling investors they'd ideally hold them long term.
"We expect to hold these securities for a long time," Buffett wrote to shareholders in 1988. "In fact, when we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever."
Above Yahoo Finance's Josh Schafer breaks down Berkshire's top holdings.
Key video takeaways:
0:15 Berkshire's top holdings
1:15 How certain Buffett picks have performed over the years
Video Transcript
- Warren Buffett's annual Berkshire Hathaway shareholder letter is set to be released on Saturday. Now, the letter digs into Buffett's top holdings, how his investment strategy has played out over the last year, and what could come next for the firm. Yahoo Finance's Josh Schafer is here with a breakdown of those top holdings. Josh, on over to you.
JOSH SCHAFER: So, like most investors, Warren Buffett's diversified portfolio has consolidated over time. As of December 31, 2022, Berkshire Hathaway's top five holdings made up about 75% of the company's entire portfolio value. Apple is Berkshire's top holding, accounting for about 40% of the company's portfolio. That's about four times the size of the next closest company, Bank of America, which accounts for just more than 11% of Berkshire's holdings.
Up next is Chevron. The oil giant accounts for just shy of 10% of Berkshire's holdings, while Coca-Cola, one of Buffett's most famous investments, particularly given his insistence on always sipping that soft drink, represents 8 and 1/2% of the portfolio. And American Express a long time holding a Buffett rounds out the top five, accounting for 7 and 1/2% of Berkshire's holdings in this.
- So I guess the question is, when the Oracle of Omaha bought these, how have they done? How have these stocks done since he bought them?
JOSH SCHAFER: Right. So let's take a look at Apple first. And you would think buying Apple in 2016 might have actually been late, right? I mean, the iPhone came out right around here, and you see a big jump there. But really, when you take a look at where they bought it in 2016, let me just get my pen going here, they bought it in 2016 here. And then it took a big jump after that and then they've sort of benefited from Apple's growth in iPhone services and the services in cloud as a whole.
Then when you take a look at Bank of America, they bought Bank of America, if we pull up a 10-year chart, they bought Bank of America in the early part here, back actually in 2011. So they bought Bank of America down here. You can see the ride that Bank of America went on after that. So in some senses there it was about buying Bank of America at the right price, basically buying almost the bottom of Bank of America, even lower than the great financial crisis.
And then I want to round it out with Coca-Cola. This is a stock that Warren Buffett has owned for a long time, going back to 1988. That's around the time the Powerade came out, Coca-Cola's Gatorade equivalent. And you can see how they benefited from the long rise of co*ke.
When you take a look at a co*ke Max chart, you can see that stock all time is up over 4,000%. And you can really see the big jump here that happened after Berkshire bought in those early days. Because again, guys, it's about, for Warren Buffett, it's about holding on for a long time and benefiting from those product innovations. co*ke Zero didn't even come out until about I think it was 2005 or 2006, so think about how much that company has changed since '88. Over 30 years later, they're still along for the ride
- And there's a reason why he's known as such a legend, right? Thank you so much, Josh Schafer.
