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Key Financial Insights on American Express and Coca-Cola
American Express (NYSE: AXP) is Berkshire Hathaway’s second-largest holding, with a 21.8% stake, trailing only Apple. In contrast, Berkshire owns 9.3% of Coca-Cola (NYSE: KO), making it its fourth-largest position. Over the past decade, American Express delivered a total return of 228%, compared to Coca-Cola’s 55% and 106% for the S&P 500.
American Express is appealing due to its dual role as both card issuer and payment processor, boasting a low net write-off rate. Additionally, it has doubled its dividend in five years, with a recent 17% increase. Coca-Cola has maintained robust operating margins despite weaker consumer demand for sugary sodas, generating steady earnings growth and expanding its portfolio into non-soda beverages. Coca-Cola has a longer track record as a Dividend King, increasing its payout for 63 consecutive years.
Investors are advised to consider American Express for growth potential while Coca-Cola may be better suited for passive income through dividends. Current economic conditions favor American Express, which is experiencing greater strength from affluent consumers.
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