Buffett Sees 232% Increase in Dividends from His Big Four: IBM, WFC, AXP, KO

International Business Machines Corporation Dividend Chart

International Business Machines Corporation Dividend Chart by YCharts

Writing in his annual letter to shareholders, Warren Buffett said he expects Berkshire Hathaway’s (BRK.A) (BRK.B ) dividend income from its Big Four stock positions to rise about 232% over the next decade to $2 billion, as the four companies’ profits attributable to Berkshire also more than double. Berkshire owns 5.5% of International Business Machines (IBM), 8.8% of Coca-Cola (KO), 7.6% of Wells Fargo (WFC) and 13% of American Express (AXP). Wells, in particular, can be expected to ratchet up its dividend after slashing the payout during the economic crisis. Berkshire, had it owned those stakes for all of 2011, would’ve gotten dividends of $862 million. “We expect the combined earnings of the four – and their dividends as well – to increase in 2012 and, for that matter, almost every year for a long time to come,” Buffett wrote. “A decade from now, our current holdings of the four companies might well account for earnings of $7 billion, of which $2 billion in dividends would come to us.”

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