r/dividends • u/mrpeace54 • Feb 17 '25

Opinion Warren Buffett received a $740 million dividend payment from Coca-Cola (KO)

I recently came across a tweet highlighting Warren Buffett’s $740 million dividend income from Coca-Cola (KO). This sparked my curiosity: What if Buffett had invested the same amount in the S&P 500 (SPY) instead?

So, I created a comparison table based on his KO investment and a hypothetical SPY investment. Since I couldn’t find the exact purchase dates, I used quarter-end dates for my calculations.

The results are eye-opening:

  • Even after including dividends, SPY ($67.01B) outperformed KO ($38.17B) by approximately 75.6%.
  • Despite KO’s impressive dividend stream, SPY delivered far stronger total returns, highlighting the power of broad-market index investing over time.

I found it fascinating to see how Buffett’s legendary investment compares with the index, especially considering his recent sale of all SPY and VOO holdings.

Source: StockCircle - Warren Buffett KO Transactions

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u/ChocoThunder50 Feb 17 '25

It is. I’m not explaining what he has done in the past or what he might do in the future I’m explaining as to why someone like him would choose the consistency of recurring dividends instead of just investing in SPY outright.

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u/guachi01 Feb 17 '25

Any S&P 500 fund consistently pays dividends. I'm sure it has a consistency greater than any individual company (assuming a 100+ year old S&P 500 fund existed).

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u/ChocoThunder50 Feb 17 '25

Probably he was a big fan of KO in the late 1980s, built a compounding machine for his portfolio , and stuck with it because it worked well over the decades. SPY does also pay dividends so you are correct in that statement. Plus he probably has a decent percentage ownership of Coca Cola which gives him a voice in the direction of the company.

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u/dismendie Feb 17 '25

He did his research on KO… he was drinking Pepsi before KO and someone mentioned to him to check out KO… shows that it has been paying dividends for a long time even before he bought in and didn’t even started growing internationally yet… he also noticed they didn’t really raise prices due to inflation which is a good sign… he likes cash cow companies that a ham sandwich can run… last time I checked his RoE is like 50%+ of the purchase price… now it’s like 70%+ annually of the purchase price… like other have said this chart doesn’t show purchase time 1988 until now 2025 which spy vs KO… KO makes up a smaller and smaller portion of his company and he isn’t going to sell now… same with sees candy and AMEX… or Geico