Warren Buffett published his annual investment letter Saturday, providing a glimpse into Berkshire Hathaway's portfolio and internal finances. The letter focused on the firm's $1.3 billion purchase of Coca-Cola stock in 1994 and its $1.3 billion investment in American Express. Buffett highlighted the long-term returns of these investments, noting that the dividend payments from both stocks have increased over time. The Coca-Cola stock was valued at $25 billion and American Express stock was valued at $22 billion by the end of 2022.
Buffett attributes this growth to what he calls Berkshire Hathaway's "secret sauce," which he says is the importance of investing early and holding on to assets for a long time. He recounts his hypothetical example of a $1.3 billion investment mistake that retained its value in 2022, which he says was worth only 0.3% of Berkshire Hathaway's net worth at the time.
The billionaire concluded by stating that investors should look for "flowers" that will blossom over time, and that only a few winners are needed to work wonders.