7 Warren Buffett Dividend Stocks Every Total Return Investor Should Own

In this article, you’ll learn about the seven Warren Buffett dividend stocks to acquire.

Warren Buffett is one of the few investors who has endured the test of time, and there is a strong reason for this. For many years, the “Oracle of Omaha” has been known across the world of investment as a rock star-like figure.

His annual shareholders’ meeting at Berkshire Hathaway is attended by hundreds of devoted fans who are also investors.

He is still widely regarded as one of the most successful investors in the world thanks to the longevity of his buy-and-hold investment strategies as well as his massive portfolio of public and private holdings.

Buffett and his right-hand man, Charlie Munger, have always tried to stick with stock ideas that they understand, and this has proven to be a winning hand for Berkshire Hathaway over the years. In addition, the majority of the companies in their portfolio are dividend payers, and these companies have a track record of consistent payment.

We went through the Berkshire Hathaway holdings in search of stocks that total return investors ought to acquire and have in their portfolios. Because it is one of the finest strategies to assist boost the chances of overall investing success, we make it a point to always remind our readers of the impact that total return has on portfolios.

To reiterate, total return refers to the sum of an increase in a stock’s value as well as dividends. For example,  If you invest in a $20 stock that pays a dividend of 3 percent, and it goes up to $22 over a year, your total return will be 13 percent. This includes 10 percent for the increase in stock price and 3 percent for the dividends paid.

Seven Warren Buffett dividend stocks fit the bill perfectly, and while all are rated Buy at major Wall Street firms, it’s important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Seven Warren Buffett Dividend Stocks To Buy 2022

#1. American Express | Warren Buffett Dividend Stocks

This stock has backed up recently and is offering the best entry point since late last year despite posting very solid second-quarter results. American Express Company (NYSE: AXP) provides charge and credit=payment card products, and travel-related services worldwide.

The company operates through three segments: global consumer services group, global commercial services, and global merchant and network services. Its products and services include payment and financing products; network services; accounts payable expense management products and services; and travel and lifestyle services.

The company’s products and services also comprise merchant acquisition and processing, servicing and settlement, point-of-sale marketing, information products, and services for merchants; fraud prevention services, as well as the design and operation of customer loyalty programs. It sells its products and services to consumers, small businesses, mid-sized companies, and large corporations through mobile and online applications, third-party vendors and business partners, direct mail, telephone, in-house sales teams, and direct-response advertising.

Shareholders are currently paid a 1.35% yield. Wells Fargo has an Overweight rating on the financial giant and a $190 price target. The Wall Street consensus target for the stock is posted at $183.63. The shares closed trading on Friday at $154.02.

#2. Chevron | Warren Buffett Dividend Stocks

This integrated energy giant is a safer way for investors looking to get positioned in the energy sector and has backed up nicely. Chevron Corporation (NYSE: CVX) through its subsidiaries, engages in integrated energy and chemicals operations worldwide. The company operates in two segments, upstream and downstream.

The upstream segment is involved in the exploration, development, production, and transportation of crude oil and natural gas; processing, liquefaction, transportation, and regasification associated with liquefied natural gas; transportation of crude oil through pipelines; and transportation, storage, and marketing of natural gas, as well as operates a gas-to-liquids plant.

The downstream segment engages in refining crude oil into petroleum products; marketing crude oil, refined products, and lubricants; manufacturing and marketing renewable fuels; transporting crude oil and refined products by pipeline, marine vessel, motor equipment, and rail car; and manufacturing and marketing of commodity petrochemicals, plastics for industrial uses, and fuel and lubricant additives. It is also involved in the cash-management and debt-financing activities; insurance operations; real estate activities; and technology businesses.

Chevron posted massive second-quarter results and remains one of the best ways to play energy safely.

The company has a sizable 3.47% dividend and has a solid place in the sector when it comes to natural gas and liquefied natural gas. Credit Suisse has an Outperform rating and a huge $202 target price. The consensus target is posted at $175.70. The shares closed Friday at $163.78, up almost 9%.

#3. The Coca-Cola Company | Warren Buffett Dividend Stocks

This company has long been a top Buffet holding as he owns 400 million shares. Coca-Cola not only offers safety but has an incredibly strong worldwide brand with 40% overseas sales. The Coca-Cola Company (NYSE: KO) is the world’s largest beverage company, offering consumers more than 500 sparkling and still brands. Led by Coca-Cola, one of the world’s most valuable and recognizable brands, the company’s portfolio features 20 billion-dollar brands including Diet Coke, Fanta, Sprite, Coca-Cola Zero, Vitaminwater, Powerade, Minute Maid, Simply, Georgia, and Del Valle. Globally, they are the No. 1 provider of sparkling beverages, ready-to-drink coffees, and juices and juice drinks

Through the world’s largest beverage distribution system, consumers in more than 200 countries imbibe the company’s beverages at a rate of more than 1.9 billion servings a day. It’s also important to remember that the company also owns 16.7% of Monster Beverage (NASDAQ: MNST), which continues to deliver big numbers.

Coca-Cola posted very strong second-quarter results, and gave very positive forward guidance as demand for the company’s products has remained strong despite price increases.

Investors are paid a very dependable 2.74% dividend. Truist Financial has a Buy rating and a $75 target price. The Wall Street consensus price objective for the stock is set at $69.54. The final trade on Thursday came in at $64.17.

#4. Kraft Heinz | Warren Buffett Dividend Stocks

Even in bad times, everybody has to eat, and this company always stands to benefit. The Kraft Heinz Company (NYSE: KHC) was formed almost six years ago via the merger of H.J. Heinz Company and Kraft Foods Group. The company is a leading global food company with $25 billion of estimated annual revenues generated by well-known brands such as Kraft, Heinz, Oscar Meyer, and Maxwell House. The company is the third-largest food and beverage manufacturer in North America and derives 76% of its revenues from that market and 24% from international.

The company’s additional brands include ABC, Capri Sun, Classico, Jell-O, Kool-Aid, Lunchables, Ore-Ida, Oscar Mayer, Philadelphia, Planters, Plasmon, Quero, Weight Watchers Smart Ones, and Velveeta. Warren Buffett holds a huge position in Berkshire Hathaway with 325 million shares.

Shareholders are paid a very large 4.34% dividend. The BofA Securities team has a Buy rating and the shares are one of the top dividend picks on the firm’s US1 list. The price target is posted at $48. The Wall Street consensus target price is set lower at $42.97.The shares closed Friday at $36.83.

#5. Kroger

This grocery chain giant is always a solid idea when the going gets rough as people tend to go out less. The Kroger Company (NYSE: KR) operates as a retailer in the United States. The company operates combination food and drug stores, multi-department stores, marketplace stores, and price-impact warehouses.

Its combination of food and drug stores offers natural food and organic sections, pharmacies, general merchandise, pet centers, fresh seafood, and organic produce; and multi-department stores provide apparel, home fashion and furnishings, outdoor living, electronics, automotive products, and toys.

Kroger’s marketplace stores feature full-service grocery, pharmacy, health and beauty care, and perishable goods, as well as general merchandise, including apparel, home goods, and toys; and price-impact warehouse stores provide grocery, and health and beauty care items, as well as meat, dairy, baked goods, and fresh produce items. It also makes and processes food products for sale in its supermarkets and online, and sells fuel through 1,613 fuel centers. As of Jan. 29, 2022, the company operated 2,726 supermarkets under various banner names in 35 states and the District of Columbia.

The company recently posted strong second-quarter earnings results and management rewarded investors by raising the dividend by a stunning 24%. Investors who purchase shares before the ex-dividend date of Aug. 12 will receive the higher dividend on Sept. 1.

Kroger shareholders are paid a 2.24% dividend. BofA Securities has a Buy rating on the shares and a $75 target price. The consensus target across Wall Street is posted at a much lower $54.92. The last trade on Friday was reported at $46.44.

#6. Merck

Merck is one of the Warren Buffett Dividend Stocks every total return investor should own.

This company remains a leading healthcare stock for conservative investors. Merck & Co. Inc. (NYSE: MRK) operates as a healthcare company worldwide through two segments, pharmaceutical, and animal health.

The pharmaceutical area offers human health pharmaceutical products in the areas of oncology, hospital acute care, immunology, neuroscience, virology, cardiovascular, and diabetes. Merck has vaccine products, such as preventive pediatric, adolescent, and adult vaccines.

The animal health segment discovers, develops, manufactures, and markets veterinary pharmaceuticals, vaccines, and health management solutions and services, as well as digitally connected identification, traceability, and monitoring products.

Merck serves drug wholesalers and retailers, hospitals, and government agencies; managed healthcare providers, such as health maintenance organizations, pharmacy benefit managers, and other institutions; and physicians and physician distributors, veterinarians, and animal producers. The company has collaborations with AstraZeneca PLC; Bayer AG; Eisai Co., Ltd.; Ridgeback Biotherapeutics; and Gilead Sciences, Inc. to jointly develop and commercialize long-acting treatments for HIV.

Investors are paid a solid 3.09% dividend. Goldman Sachs has a $105 target price and the stock is on the firm’s Conviction List of top stock picks. Merck has a consensus target across Wall Street of $96.54, which compares with Friday’s closing print of $89.34.

#7. Verizon Communications

Last but not least on the list of seven Warren Buffett Dividend Stocks to buy is Verizon Communications. This is a top telecommunications company that offers tremendous value at current levels. Berkshire Hathaway owns a stunning 158.8 million shares. Verizon Communications, Inc (NYSE: VZ) is one of the largest US telecom companies. It provides wireless and wireline services to retail, enterprise, and wholesale customers.

The company’s wireless network serves about 120 million mobile connections with 115 million postpaid subscribers. Verizon’s wireline business has undergone a period of secular decline because of wireless substitution and cable competition. Verizon also provides converged communications, information, and entertainment services over America’s most advanced fiber-optic network, and delivers integrated business solutions to customers worldwide.

Verizon posted disappointing second-quarter results and the stock was hammered. Patient investors can buy shares now, and collect the massive dividend while management sorts out the current issues.

Verizon investors are paid an outstanding 5.54% dividend. Cowen has an Outperform has a Buy rating to go with a $64 target price. The consensus price target across Wall Street is set at $60.64. Verizon closed Friday’s trading session at $53.73.

Given Warren Buffett’s proclivity for only owning the stocks of companies that he understands inside and out, all of these all make sense now for growth and income investors worried about the potential for a continued steep market decline. While they could sell off in a large correction, they will hold up far better than most and are less likely to be stung by higher interest rates.