If any investor has stood the test of time, it is Warren Buffett, and with good reason. For years, the so-called Oracle of Omaha has had a rock-star-like presence in the investing world. His annual Berkshire Hathaway shareholders meeting draws thousands of loyal fans who are investors. Known for his long buy and hold strategies, and his massive portfolio of public and private holdings, he remains one of the preeminent investors in the world.
We decided to take a look into his portfolio’s biggest holdings for those that not only look poised to do well this year but pay big, dependable dividends. We found five that are ideal stocks for investors to consider now. While interest rates are poised to move higher this year, these companies should not be damaged by the increase, and some actually may benefit.
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Bank of America
The company recently posted very solid fourth-quarter results. Bank of America Corp. (NYSE: BAC | BAC Price Prediction) is a ubiquitous presence in the United States, providing various banking and financial products and services for individual consumers, small and middle-market businesses, institutional investors, corporations and governments in the United States and internationally. It operates 5,100 banking centers, 16,300 ATMs, call centers and online and mobile banking platforms.
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The bank has expanded into several new U.S. markets, with scale across the country positioning it ideally to benefit from accelerating loan growth over the next two years. Moreover, unlike smaller peers, scale allows the bank to increase investment substantially over the next few years without notably jeopardizing returns, driving further market share gains.
Shareholders receive a 1.83% dividend. Buffett owns a stunning 1.1 billion shares of Bank of America stock. The consensus price target is $51.40, and shares were last seen on Thursday trading at $45.47 apiece.
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Coca-Cola
This remains a top Buffet holding, as he owns a huge 400 million shares. Coca-Cola Co. (NYSE: KO) is the world’s largest beverage company, refreshing consumers with more than 500 sparkling and still brands.
Led by Coca-Cola, one of the world’s most valuable brands, the company’s portfolio features 20 billion-dollar brands including Diet Coke, Fanta, Sprite, Coca-Cola Zero, vitaminwater, Powerade, Minute Maid, Simply, Georgia and Del Valle. Globally, it is the number one provider of sparkling beverages, ready-to-drink coffees and juices and juice drinks.
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Through the world’s largest beverage distribution system, consumers in more than 200 countries enjoy Coca-Cola beverages at a rate of more than 1.9 billion servings a day. Also remember that the company also owns 16.7% of Monster Beverage, which continues to deliver big numbers.
Coca-Cola stock investors receive a 2.62% dividend. The consensus price objective is $63.84. The final trade for Thursday came in at $59.65 per share.
Kroger
This top grocer does almost all its business in the United States, and it is a very solid idea now. Kroger Co. (NYSE: KR) operates as a retailer in the United States. Its combined food and drug stores offer natural food and organic sections, pharmacies, general merchandise, pet centers, fresh seafood and organic produce.
It also operates multi-department stores that provide apparel, home fashion and furnishings, outdoor living, electronics, automotive products and toys. The company’s marketplace stores offer full-service grocery, pharmacy, health and beauty care departments, and perishable goods, as well as general merchandise, including apparel, home goods, and toys.
Kroger also has price impact warehouse stores that provide grocery and health and beauty care items, as well as meat, dairy, baked goods and fresh produce items. The company also manufactures and processes food products for sale in its supermarkets, and it sells fuel through 1,596 fuel centers.
As of January 30, 2021, the company operated 2,742 retail food stores under various banner names in 35 states and the District of Columbia, as well as an online retail store.
Inventors receive a 1.89% dividend. Berkshire Hathaway holds 61.8 million shares. The consensus price target for Kroger stock is $45.92, but the most recent share price was a close $45.40.
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U.S. Bancorp
This top super-regional bank is one of the highest paying dividend bank stocks, which should outperform with interest rates heading higher. U.S. Bancorp (NYSE: USB) provides various financial services in the United States through a network of 2,434 banking offices, principally operating in the Midwest and western regions of the United States, as well as through online services and a network of 4,232 ATMs.
U.S. Bancorp offers depository services, including checking accounts, savings accounts and time certificate contracts; lending services, such as traditional credit products; and credit card services, lease financing and import/export trade, asset-backed lending, agricultural finance and other products. It also provides ancillary services comprising capital markets, treasury management and receivable lock-box collection services to corporate customers; and a range of asset management and fiduciary services for individuals, estates, foundations, business corporations and charitable organizations. In addition, the company offers investment and insurance products to its customers principally within its markets, as well as fund administration services to a range of mutual and other funds.
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U.S. Bancorp also provides corporate and purchasing card and corporate trust services, and merchant processing services, as well as cash and investment management, ATM processing, mortgage banking and brokerage and leasing services.
Shareholders receive a 3.20% dividend. Buffet has purchased 126.4 million shares for Berkshire Hathaway. The consensus price objective is $65.52, and U.S. Bancorp stock closed at $57.44 a share on Thursday.
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Verizon
This top telecommunications company offers tremendous value at current levels, and Berkshire Hathaway owns 158.8 million shares. Verizon Communications Inc. (NYSE: VZ) is one of the largest U.S. telecom companies. It provides wireless and wireline service to retail, enterprise and wholesale customers.
Verizon’s wireless network serves approximately 120 million mobile connections with 115 million postpaid subscribers. Its wireline business has undergone a period of secular decline due to wireless substitution and cable competition.
Verizon also provides converged communications, information and entertainment services over America’s most advanced fiber-optic network, and it delivers integrated business solutions to customers worldwide.
Investors receive a 4.84% dividend. The consensus price target is $59.96. Verizon Communications stock closed Thursday’s trading session at $51.19.
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Given Warren Buffet’s proclivity for only owning the stock of companies that he understands inside and out, these all make sense now for growth and income investors worried about the potential for a steep market decline. While they could sell off in a large correction, they will hold up far better than most, and they make sense for those with a long-term investing approach.
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