Warren Buffett loves dividend-paying stocks, but Berkshire doesn't pay one — Here's why

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The main reason Berkshire doesn't offer a dividend itself is that the Oracle of Omaha has been confident in his ability to more profitably deploy capital.

Warren Buffett is a fan of buying dividend-paying stocks, but his conglomerate Berkshire Hathaway doesn't offer a payout itself, despite its tens of billions cash. A regular dividend is a way to reward shareholders by distributing a portion of a company's earnings, often quarterly, in the form of cash. Sometimes companies even offer a small discount for reinvested dividends.

Berkshire initiated a buyback program in 2011 and relied on repurchases in recent years during a competitive deal-making environment and an expensive stock market. The conglomerate spent a record $27 billion in buybacks in 2021 as Buffett found few external acquisition opportunities. Even then, the buyback activity has slowed over the past year.

 

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