How Warren Buffett's Two Dividend Champions Have Performed Since His 2022 Endorsement

When Warren Buffett penned his 2022 annual letter to Berkshire Hathaway shareholders, he decided to pull back the curtain on what he considered the true drivers of his company’s three-decade performance. Among the most impressive statistics: Berkshire’s cumulative gain of 3,787,464% since 1964 dwarfed the S&P 500’s 24,708% return. Yet before diving into his capital allocation track record, Buffett did something unusual—he highlighted two specific investments that he believed exemplified the “secret sauce” behind Berkshire’s success. What made these picks so special? Both companies had received exactly $1.3 billion from Berkshire, and both were now generating annual dividends approaching 50% of that original investment through consistent payout increases.

Nearly four years later, it’s worth checking in on how these dividend champions have performed and whether Buffett’s assessment about their reliability has held up.

The Case for Dividend Compounding: Why Buffett Highlighted These Two

Warren Buffett’s investment philosophy rests heavily on the concept of yield on cost—the dividend return calculated against what you originally paid for a stock, rather than its current price. This metric reveals the true power of patient investing combined with company discipline in raising payouts year after year. The two stocks Buffett singled out embody this principle: stable, established businesses with decades-long commitments to rewarding shareholders through growing dividends. His 2022 letter essentially served as a masterclass in how compounding dividend growth can create wealth far more reliably than chasing price appreciation alone.

American Express: The Faster-Growth Dividend Play

American Express, the payments giant that Buffett’s Berkshire has maintained a $1.3 billion stake in, has arguably become the more exciting of the two holdings in recent years. When Buffett wrote his 2022 letter, American Express was paying annual dividends of approximately $302 million on Berkshire’s position. Fast forward to early 2026, and that figure has surged to $577 million—a remarkable 91% increase in just four years.

Despite this explosive dividend growth, American Express shares currently yield less than 1% to new investors. The reason? The stock price has appreciated 191% over the past five years, pushing the yield down significantly. However, to a long-term holder like Buffett, this capital appreciation combined with surging dividends creates an enviable position: the yield on cost for Berkshire’s position stands at nearly 50%, far outpacing typical market returns.

The company’s operational momentum suggests the dividend trajectory will continue. In Q3, American Express raised its annual card fees for the 29th consecutive quarter—a sign that pricing power remains intact despite economic headwinds. With earnings up 19% year-over-year and $2.3 billion earmarked for share repurchases, the company possesses the financial firepower to sustain its generous dividend policy while simultaneously reducing share count, thereby magnifying per-share earnings growth.

Coca-Cola: The Dividend King’s Steady March Forward

If American Express represents growth, Coca-Cola represents the ultimate dividend stability. Berkshire’s investment in the soft drink manufacturer dates back to the early 1990s, when Buffett accumulated 400 million shares over a seven-year accumulation period, with the final purchase in August 1994. In the three decades since, he hasn’t sold a single share.

The numbers tell the story of disciplined dividend management. In 1994, Coca-Cola paid Berkshire $75 million annually in dividends. By 2022, that amount had grown to $704 million—a nearly tenfold increase over 28 years. The company achieved this feat through an unbroken streak of annual dividend increases; Coca-Cola holds the prestigious title of “Dividend King,” a distinction earned by fewer than one in 1,000 publicly traded companies.

Even more impressively, in the years since Buffett’s 2022 letter, Coca-Cola has continued its predictable pattern of annual dividend hikes. Berkshire’s 400 million shares now generate approximately $706 million annually in dividends—a 21% increase from 2022 levels. Current investors in Coca-Cola shares enjoy a yield of just 2.8%, but Buffett’s yield on cost remains at an extraordinary 50%, reflecting the power of holding a quality dividend-payer through multiple market cycles.

Coca-Cola’s business momentum supports continued dividend growth. In the most recent quarter, the company posted robust earnings growth of 30% year-over-year, providing ample earnings coverage for its payout obligations. Management has historically been reluctant to interrupt Coca-Cola’s dividend-increase streak, making another announcement highly probable in the coming months.

Can Both Companies Maintain Their Dividend Acceleration?

The critical question for any dividend investor is sustainability. Will American Express and Coca-Cola be able to continue raising their payouts at similar rates, or are we approaching a plateau?

For Coca-Cola, the track record provides strong reassurance. With over five decades of consecutive annual dividend increases, the company has painted itself into a corner—and not in a bad way. Management views the Dividend King status as a badge of honor that must be protected. Barring a major recession or unforeseen catastrophe, Coca-Cola will almost certainly announce its 64th consecutive annual dividend increase within the next few months. The company’s pricing power in a inflationary environment and its global scale provide multiple levers for maintaining earnings growth that supports the payout.

American Express faces a different but equally favorable scenario. The company has proven it can raise card fees consistently, increase transaction volumes, and simultaneously expand margins. The 19% earnings growth in the most recent period wasn’t an anomaly—it reflects structural improvements in the business model. The company’s $2.3 billion share repurchase program adds another dimension: by reducing share count, American Express can grow dividend-per-share faster than overall earnings grow, creating a sustainable pattern of accelerating payouts.

The Warren Buffett Investment Lesson

What Warren Buffett identified in his 2022 letter was the compound power of patient capital allied with corporate discipline. By holding two stocks for decades and allowing reinvested dividends to purchase additional shares (or in the case of Coca-Cola, receiving massive dividend checks that can be deployed elsewhere), an investor can achieve returns that dwarf typical market performance. The 50% yield on cost that Berkshire now enjoys on both positions would be impossible to replicate for a new investor today—but the principle remains timeless.

For investors seeking to emulate this approach, the lesson is clear: find businesses with sustainable competitive advantages, buy and hold during multiple market cycles, and reinvest or deploy dividends wisely. The results, as Coca-Cola and American Express have demonstrated over the past four years, speak for themselves.