If You Invested $1,000 In Coca-Cola Stock When Warren Buffett Did, Here's How Much You'd Have Now

For decades, beverage giant Coca-Cola Inc KO has been a staple holding in the portfolio of Warren Buffett's Berkshire Hathaway Inc (NYSE: BRK-A)(NYSE: BRK-B). Here’s a look back at the firm's very first purchase and how investors would have done had they invested in Coca-Cola's stock alongside Buffett from the very start.

What Happened: Berkshire Hathaway's portfolio includes holdings in top public companies like Coca-Cola, Apple Inc, American Express and more. It also owns many well-known companies, including Dairy Queen, Duracell, GEICO and Fruit of the Loom.

In 1988, Buffett and Berkshire Hathaway made a splash by buying shares of Coca-Cola. By the end of the year, Berkshire Hathaway had acquired 14,172,500 shares at an average price point of $41.81.

In an annual letter that year, Buffett, who is said to drink five cans of Coke or Cherry Coke a day, addressed the purchase of Coca-Cola shares.

“In 1988, we made major purchases of Federal Home Loan Mortgage Pfd and Coca Cola. We expect to hold these securities for a long time,” Buffett said. “In fact, when we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”

Berkshire Hathaway would continue to add to its Coca-Cola position over the following years and see its share count blossom from several stock splits.

The firm now owns 400 million shares of Coca-Cola, which makes up around 8.5% of its portfolio. Berkshire Hathaway owns over 9% of Coca-Cola’s shares.

Related Link: If You Invested $1,000 In Berkshire Hathaway When Warren Buffett Did, Here's How Much You'd Have Now 

Investing $1,000 in Coca-Cola: The big bet by Buffett in 1988 marked one of the largest bets on a public company by the legendary investor.

If an investor had invested at the same price and time Berkshire Hathaway had purchased its shares, that investor would have been pleasantly rewarded today. 

A $1,000 investment at the time could have purchased 23.92 shares of Coca-Cola. Shares of Coca-Cola split 2-for-1 in 1990, 1992, 1996 and 2012. The stock splits would have turned the $1,000 investment into 382.72 shares.

Today, the $1,000 investment would be worth $23,326.78, based on a price of $60.95 at the time of writing, and not including dividends.

The investment would be up a staggering 2,232.7% over the last 33 years, representing an average annual return of 67.7%.

Not every investment made by Buffett will be a winner, but the legendary investor has proved that many of Berkshire Hathaway's top holdings have seen a nice return on investment when held for many years.

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