Like peanut butter and jelly, or ice cream on apple pie, Warren Buffett and Coca-Cola (KO) just seem to go together.
For nearly four decades, the Oracle of Omaha was Coke’s largest shareholder through his holding company, Berkshire Hathaway (BRK.A).
Buffett drank as many as 5 Cokes a day and considered Coke one of his best investments, run by some of the world’s best managers. “If you gave me $100 billion and said take away the soft drink leadership of Coca-Cola in the world,” he once said, “I’d give it back to you and say it can’t be done.”
But a lot has changed since Buffett first bought Coke nearly four decades ago. And with KO hitting an all-time high in August 2026, it’s worth applying some Buffett-level thinking to see whether it’s still a good buy today.
Cans of Coca-Cola Co. bearing a likeness of Warren Buffett, chairman and chief executive officer of Berkshire Hathaway Inc., sit in a bucket during a shareholders shopping day ahead of the Berkshire Hathaway annual meeting in Omaha, Nebraska, U.S., on Friday, May 5, 2017. Photographer: Daniel Acker/Bloomberg via Getty Images
What makes Coca-Cola a good long-term investment?
Rewind to 1988, when Buffett first put Coca-Cola in his crosshairs. Bobby McFerrin’s “Don’t Worry, Be Happy” was on the radio, Who Framed Roger Rabbit ruled at the box office, and Wall Street was still recovering from the Black Monday crash of 1987.
Buffett was 57 years old—and a newly minted billionaire—when Berkshire began buying Coke. He saw it as an exceptional business with an iconic brand and nearly unmatched pricing power. Coming off the 1987 market crash, its stock also offered good value relative to what Buffett saw as its long-term earnings potential.
Berkshire bought $1 billion worth of shares between 1988 and 1989—and remarkably, never sold a single one.
In his shareholder letter, Buffett famously explained, “When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”
Coca-Cola has proven its staying power in the decades since Buffett bought in. The company has grown into a massive global beverage business that has weathered recessions and pivoted its product line-up to match changing consumer tastes. Its portfolio has expanded well beyond sodas, while its annual dividend has consistently increased.
Its market capitalization has risen from roughly $16 billion in 1988 to $385 billion in 2026, and more than 2 billion servings of its beverages are consumed worldwide every day.
By many measures, then, the qualities that originally attracted Buffett to Coca-Cola remain intact.
How much would you have made if you bought KO in 1988?
KO is worth an astounding 34 times what it was when Warren Buffett made his initial purchases. In August 1988, shares were worth roughly $2.60 per share (adjusting for splits); in August 2026, KO is trading around $90.
That means that a $10,000 investment in Coca-Cola in August 1988 would be worth approximately $343,000 today based on share-price appreciation alone—and that doesn’t even factor in those juicy dividends.
What were KO’s latest quarterly results?
Coca-Cola’s earnings continue to prove that it packs a powerful punch. In the second quarter of 2026, it reported net income of $4.43 billion, or $1.03 per share, up from $3.81 billion, or 89 cents per share, a year earlier.
It also posted a 7% revenue increase and 16% EPS growth. Management raised its 2026 outlook while projecting more than $12 billion in free cash flow.
Investors took notice: KO shares hit a new all-time intraday high of $92.49 on August 24, 2026.
In fact, KO has surged more than 30% in 2026 as investors sought shelter from the tech volatility by rotating into the more defensive consumer staples sector.
Even after Buffett’s retirement, Berkshire continues to hold 400 million Coca-Cola shares, and it remains the company’s largest shareholder.
Is Coca-Cola overvalued?
Here’s where Coke loses some of its fizz.
KO is currently trading at roughly 27 times forward earnings.
Barron’s recently pointed out that Coke’s valuation actually exceeds most of the Magnificent Seven—even though it’s a mature beverage company and not a hyperscaler growing earnings at 20% or 30%.
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Coca-Cola can have nearly everything a long-term investor wants: brand strength, defensive qualities, continued pricing power, and a growing dividend. But if investors pay too much for those qualities, even a great company can become a less compelling investment.
Buffett himself recently sounded a warning about elevated valuations, observing that investors are in a particularly speculative mood and that “prices for an awful lot of things will look very silly.”
So the question isn’t whether Coca-Cola remains a wonderful business. It’s whether today’s price still leaves enough room for a wonderful investment. And at roughly 27 times forward earnings, new investors may want to wait for either earnings to catch up—or its share price to cool down—before following Buffett into Coke.