Two Buffett Stocks to Buy in a Market Crash and Hold Forever

Investors often seek stability during market turbulence, and Warren Buffett’s portfolio offers a blueprint for enduring, recession-resistant holdings. Among Berkshire Hathaway’s top positions, two stocks stand out as quintessential “forever” buys: Coca-Cola (KO) and American Express (AXP). Both have withstood decades of economic cycles, offering dividends, pricing power, and brands that transcend short-term volatility. Let’s explore why these are ideal buys during a crash—and why they deserve a permanent place in your portfolio.

1. Coca-Cola: The Beverage Giant with a Century-Old Moat

Coca-Cola has been a cornerstone of Buffett’s portfolio since 1988—37 years and counting—with no shares sold. As of early 2025, it ranked fourth in Berkshire’s holdings at $29.7 billion, representing 9.3% of the portfolio. Its enduring appeal lies in:
- Recession-Resistant Demand: Coca-Cola’s beverages are a global staple, with 19 of its brands generating over $1 billion in annual revenue. Even in economic downturns, consumers prioritize affordable indulgences like soda.
- Consistent Dividends: The stock yields 2.8%, and Buffett has praised its “predictable profitability,” with dividends growing steadily for 61 consecutive years.
- Market Resilience: In Q1 2025, Coca-Cola surged +15%, outperforming broader markets amid rising interest rates. Its ability to raise prices (e.g., a 6% hike in 2024) while maintaining volume underscores its pricing power.

Why Buy in a Crash?

Coca-Cola’s P/E ratio of 21.4 (vs. a 5-year average of 22.8) suggests it’s trading at a slight discount, even after recent gains. Historically, its stock has rebounded sharply post-recession—rising +42% in 2009 and +30% in 2020—making it a classic “buy the dip” candidate.

2. American Express: The Credit Card Giant with a “Forever” Stamp

American Express has been Buffett’s “forever” holding since 1991—34 years—with not a single share sold. As of April 2025, it ranked second in Berkshire’s portfolio at $38.24 billion, or 16.8% of holdings. Its strengths include:
- Strong Balance Sheet: Amex’s credit losses remain low (0.4% of loans in Q1 2025), and its $12 billion in cash provides a buffer against economic shocks.
- Loyalty-Driven Revenue: Its premium card members spend $36,000 annually, far exceeding competitors. The Membership Rewards program locks in long-term customer value.
- Dividend Discipline: With a 2.3% yield, Amex has increased dividends for 25 consecutive years, supported by consistent operating margins (20–22%).

Why Buy in a Crash?

Amex’s P/E of 16.7 (vs. a 5-year average of 17.5) reflects undervaluation, even after a 9% dip in Q1 2025. Historically, its stock has rebounded swiftly: it gained +140% from 2008 lows and +65% post-pandemic. Its focus on affluent customers—whose spending is less volatile—gives it a defensive edge.

The Buffett Playbook: Buy Low, Hold Forever

Both Coca-Cola and American Express align with Buffett’s core principles:
1. Durable Competitive Advantages: Their brands are unassailable—Coca-Cola’s global reach and Amex’s premium positioning lack direct substitutes.
2. Cash Flow Machines: Coca-Cola generates $10 billion in free cash flow annually, while Amex’s net income hit $5.8 billion in 2024—both fuel dividends and reinvestment.
3. Long-Term Focus: Buffett has never sold a share of either, even during the 2008 crisis or the pandemic. As he noted in his 2025 shareholder letter, “The best time to buy is when fear is high.”

Conclusion: Crash-Proof, Forever Holdings

In a market crash, Coca-Cola and American Express offer investors two rare traits: safety and timeless growth.

• Coca-Cola’s 37-year track record and +2.8% dividend yield make it a hedge against inflation and uncertainty. Its global footprint and pricing power ensure steady returns, even as competitors falter.
• American Express’s 34-year “forever” status and 2.3% yield reflect Buffett’s confidence in its customer loyalty and balance sheet. Its premium model thrives when credit markets tighten, as affluent spenders prioritize quality over cost.

Together, these stocks represent $67.94 billion of Berkshire’s $269 billion equity portfolio—a testament to their enduring value. For investors, buying them during a downturn isn’t just a tactical move; it’s a generational bet on brands that define consumer culture.

As Buffett once said, “Be fearful when others are greedy, and greedy when others are fearful.” In Coca-Cola and American Express, you’ll find two stocks to act on that wisdom—and hold for decades.