To The Moon

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Warren Buffett is famous for his value investing approach, but another key strategy of his is dividend investing. Dividend stocks have long been a core part of $Berkshire Hathaway(BRK.B)$ $Berkshire Hathaway(BRK.A)$ 's portfolio, with nearly 93% of holdings concentrated in them.

Among these dividend stocks, $Apple(AAPL)$ stands out as Buffett's top pick.

Although Buffett's own company doesn’t pay dividends, he has a strong preference for dividend-paying stocks. His strategy isn't just about chasing high dividend yields, he's interested in companies that can consistently maintain and grow their dividends.

This approach has paid off well, as Berkshire earns around $6 billion in dividend income annually, with five companies contributing $4.36 billion of that.

From 1993 to the end of 2022, the $S&P 500(.SPX)$ rose by 777%. However, when dividends are included, the total increase exceeds 1400%. This shows that dividends have accounted for over 20% of market returns during this period.

Buffett's Top Dividend Stock

Analyzing Berkshire Hathaway’s 13F filings for Q2 2024, we identified all the dividend stocks in their portfolio and checked hedge fund sentiment. Apple is clearly Buffett’s top dividend stock.

$Apple(AAPL)$

- Value of Berkshire’s Holding: $84.25 billion

- Sector: Information Technology

- Industry: Consumer Electronics

In Q2 2024, Berkshire unexpectedly cut its Apple stake by over 49%. Despite this, Apple remains Berkshire’s largest stock holding, accounting for over 30% of their portfolio. Buffett had already reduced Apple shares by 13% in Q1, partly for tax reasons.

While Berkshire reduced its Apple stake, the stock's popularity among top funds surged. Holdings in Apple increased from 150 to 184 funds, with a combined value exceeding $124 billion. For instance, Baron Funds bought back Apple shares in Q2 2024, citing Apple's strong business and growing user base in both devices and services, plus its AI strategy, "Apple Intelligence."

In Q3 FY2024, Apple reported revenue of $85.7 billion, up 4.8% year-over-year. The company remains financially stable with $29 billion in operating cash flow and returned $32 billion to shareholders through dividends and stock buybacks.

As of August 21, Apple’s quarterly dividend is $0.25 per share, yielding 0.44%. In May, Apple raised its dividend for the 12th consecutive year.