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In a few months, Greg Abel will hit his one-year mark as the CEO of Berkshire Hathaway (NYSE: BRKA), (NYSE: BRKB).
Before becoming CEO, Abel had worked at Berkshire since 1999, most recently as the head of Berkshire Hathaway Energy. But filling the shoes of the great Warren Buffett, who led the company for six decades and is widely considered the greatest investor ever, is no easy task.
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In addition to running all of Berkshire's businesses, Abel is now also charged with running the large conglomerate's $350 billion-plus stock portfolio. Three consumer stocks make up 12.5% of the total portfolio. Here's my top pick to buy now.
The largest of these three stocks is the iconic consumer beverage company Coca-Cola (NYSE: KO). Not only is Coca-Cola one of Berkshire's largest positions, but it's also one of the oldest in the portfolio, which Buffett and team began buying in the 1980s.
In his first letter to shareholders earlier this year, Abel listed Coca-Cola as one of Berkshire's "core" holdings that will see "limited activity," so expect it to be in Berkshire's portfolio for the foreseeable future.
Coca-Cola has many of the qualities Buffett looks for in stocks, including an incredible brand and the ability to return capital to shareholders annually. Management also continues to build a diverse beverage lineup to meet shifting consumer preferences.
Stronger-than-expected growth this year, in part due to the World Cup and more investors rotating into consumer staples, has been a boon for the stock. Additionally, Coca-Cola has long been a great dividend stock.
The company has increased its annual dividend for 64 consecutive years, placing it in an exclusive group of stocks known as Dividend Kings.
The multinational food company Kraft Heinz (NYSE: KHC) has long been viewed as one of Buffett's biggest mistakes.
Berkshire teamed up with the Brazilian private equity firm 3G Capital to purchase Heinz in 2013 for over $23 billion. Then in 2015, the duo merged Heinz with Kraft to create the company that exists today, which Berkshire still holds a 27.5% stake in. The stock has been a big loser since the merger.
The company still has significant debt and is also struggling, in part, due to shifting consumer preferences, which have not boded well for several of its key brands.
After years of disappointment, the company announced in September 2025 that it planned to split into two companies to unlock shareholder value and reduce operational complexity. At the time, it was clear that Buffett and Abel were not happy with the plan. Berkshire removed its two members from Kraft Heinz's board of directors and looked poised to begin unloading the stock.
But in another twist in February, New Kraft Heinz CEO Steve Cahillane, a veteran in the business, paused the planned split, calling the company's challenges "fixable and within our control."
In June, Kraft Heinz announced a global corporate restructuring, with one emerging markets division, a Europe and Pacific developed markets division, and a North America division. Cahillane said the move would help the company "meaningfully accelerate and scale our progress."
Berkshire still held its large stake in the company at the end of the second quarter, so it's hard to say where Abel stands with the company right now. Kraft Heinz does have a trailing-12-month dividend yield of nearly 7.3%.
The grocery chain Kroger (NYSE: KR) is the smallest of these three positions and the newest, having been initiated by Berkshire in 2019.
The stock hasn't been anything special this year or over the past five years, underperforming the broader market. Grocery chains run on slim profit margins as is, and they also face competition from other grocery businesses, whether online or discount retailers like Costco Wholesale.
In the second quarter, Kroger grew sales by about 2.1% year over year, while adjusted earnings rose by about 5%. Kroger has a 2.6% trailing dividend yield, and it's a consumer staples stock that will serve you well when the market or economy is struggling.
Of these three, Coca-Cola is my top pick, as it offers investors a best-in-breed consumer staples play with a proven dividend. Kraft Heinz could be a turnaround opportunity and has a much higher dividend yield, but it could very well remain a value trap, which is what it's been since the merger.
While Kroger isn't necessarily a bad defensive pick, Coca-Cola's business is actually thriving as well. In the second quarter, the company reported its strongest trademark growth of the original Coca-Cola brand in 17 years.
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Bram Berkowitz has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway and Costco Wholesale. The Motley Fool recommends Kroger. The Motley Fool has a disclosure policy.
Greg Abel Has 12.5% of Berkshire Hathaway's Portfolio in 3 Consumer Stocks. Here's My Top Pick to Buy Now. was originally published by The Motley Fool
