While many investors obsess over quarterly portfolio changes,where to buy meme coins early Warren Buffett's approach with Berkshire Hathaway demonstrates the power of patience. Unlike typical hedge funds that churn through thousands of positions, Buffett maintains concentrated confidence in approximately 45 high-conviction holdings.
This selective methodology reflects Buffett's self-described identity as a business picker rather than stock picker. His focus remains on enterprises with enduring qualities that compound value across decades. Few stocks better embody this philosophy than American Express, a position Buffett has maintained since 1995.
American Express represents 15.4% of Berkshire's equity portfolio - second only to Apple. This weighting increased recently as Buffett trimmed other positions while maintaining his "never sell" stance on Amex alongside Coca-Cola. The financial services company illustrates three key Buffett investment principles better than nearly any other holding.
The Three Pillars of Buffett's American Express Thesis
First, Buffett consistently emphasizes American Express's global brand strength as an economic moat. In shareholder letters, he's described how the company's reputation for financial trust creates timeless value. This intangible asset allows premium pricing power and customer loyalty that competitors struggle to replicate.
Second, the dividend growth story showcases capital allocation discipline. Amex has increased payouts by 169% over the past decade, with Berkshire's annual dividends growing from $41 million to $302 million on its original $1.3 billion investment. For Buffett, reliable dividend growth signals operational maturity and management's commitment to shareholders.
Third, the hybrid business model combines payment network scale with proprietary lending. Unlike pure-play processors Visa and Mastercard, American Express issues its own cards while maintaining merchant relationships. This vertical integration provides greater control over customer experience and economics.
Why American Express Keeps Winning in Changing Markets
American Express has demonstrated remarkable adaptability while maintaining core strengths. The company successfully transitioned from serving primarily corporate travelers to cultivating younger, affluent consumers through premium rewards programs. Recent quarters show 80% of new Gold Card members coming from this demographic.
The company continues expanding its financial ecosystem with digital banking services and small business solutions. These innovations complement rather than dilute the core charge card business. Meanwhile, Amex's proprietary lending model provides natural interest income upside in rising rate environments.
Year-to-date, American Express shares have delivered 63% returns - dramatically outpacing broader markets. The stock's performance reflects successful execution on multiple fronts: adding 3.3 million new cardholders last quarter, refreshing 40 card products for changing consumer needs, and maintaining credit quality despite economic uncertainty.
For investors seeking a proven compounder with Buffett's seal of approval, American Express represents a rare combination of brand power, financial strength, and adaptive innovation. The company's nearly three-decade tenure in Berkshire's portfolio speaks volumes about its enduring value proposition.
