You Won't Believe How Much Money Berkshire Hathaway Gets From American Express Dividends

American Express (NYSE: AXP) is 1 of Berkshire Hathaway's (NYSE: BRKA)(NYSE: BRKB) longest-held stocks. It archetypal bought the banal mode backmost successful 1964. It aboriginal sold that presumption but reopened it successful 1991 and hasn't sold it since. In fact, it's 1 of the stocks that Warren Buffett said he'd ne'er sell. But present that Buffett is nary longer CEO, could the banal beryllium connected the chopping block?

New CEO Greg Abel made it wide that he's not looking to alteration things up astatine the company. Beyond that, however, if you recognize what American Express banal does for Berkshire Hathaway, you'd spot however lucrative it is and however overmuch consciousness it makes to support it successful the portfolio.

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Berkshire Hathaway bought American Express banal implicit a several-year period, ending successful 1995. Today, it owns 151,610,700 shares, oregon 22.1% of the full company, worthy much than $46 billion.

American Express banal has crushed the marketplace performance-wise implicit the past 10 years, with a full instrumentality of 496% compared to 305% for the broader index. But Berkshire Hathaway gets overmuch much than unrealized gains connected this investment.

American Express' dividend yields 1.07%, which isn't terrific. In fact, it's beneath the S&P 500 mean of 1.15%.

However, the output connected the outgo ground is overmuch higher than that, since the dividend has grown implicit the past three-plus decades successful which Berkshire Hathaway has owned the stock. Berkshire Hathaway paid astir $1.3 cardinal successful full for its involvement successful American Express, making its outgo ground astir $8.60 per share.

The yearly dividend per stock is $3.80, which means it's making 44% a twelvemonth connected its archetypal concern conscionable successful dividends. That worked retired to $479 cardinal successful 2025 unsocial and makes much each twelvemonth arsenic American Express raises the dividend.

Before you bargain banal successful American Express, see this:

The Motley Fool Stock Advisor expert squad conscionable identified what they judge are the 10 champion stocks for investors to bargain now… and American Express wasn’t 1 of them. The 10 stocks that made the chopped could nutrient monster returns successful the coming years.

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