While Wall Street Worries, This Cheap Warren Buffett Stock Is a Screaming Buy

Key Points
Warren Buffett's Berkshire Hathaway portfolio is built for times like this.
One Buffett stock that is outperforming the market is Coca-Cola.
Coca-Cola stock is up 10% year-to-date, yet it remains relatively cheap with an excellent dividend.
- 10 stocks we like better than Coca-Cola ›
It has been a particularly volatile month for stocks, with geopolitical conflicts rattling markets and investors. At the same time, tech stocks have been going through a correction, as valuations soared during the three-year bull market. Looking ahead, the view is murky. War creates uncertainty for the economy, inflation, rates, and other indicators that companies and markets rely on.
During uncertain and volatile times, it's not a bad idea to turn to the Oracle of Omaha, Warren Buffett, the former CEO of Berkshire Hathaway (NYSE: BRKA) (NYSE: BRKB). Buffett is one of the world's greatest value investors, and he built up the Berkshire Hathaway portfolio over the past 60 years to navigate times like this.
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The companies selected for the Berkshire Hathaway portfolio are typically market leaders with strong competitive advantages that are undervalued, have excellent leadership, and are built for the long term. These are exactly the types of companies that tend to perform well in downturns. So, looking at Buffett's picks can serve as a guide for investors.
The stock that Buffett has held longer than almost any other is Coca-Cola (NYSE: KO). Here's why Coca-Cola stock is a buy right now.
Buffett loves Coca-Cola
Coca-Cola is the third largest position held by Berkshire Hathaway, representing about 11.4% of the portfolio. It is also Buffett's longest-held stock, as he started buying shares in 1988.
It ticks off all the boxes for Buffett and Berkshire as a dominant market leader and reliable consumer staple. The soft drinks and products that Coca-Cola makes are consumed whether times are good or bad. That showed in its results last year, when Coca-Cola gained market share, and is evident in its outlook for 2026.
Adjusted revenue rose 5% in 2025, while adjusted earnings per share (EPS) increased 4%. In 2026, Coca-Cola guided for 4% to 5% adjusted revenue growth and 7% to 8% non-GAAP EPS growth. The company also expects to increase its free cash flow to $12.2 billion.
The strong and stable performance and excellent liquidity have also made Coca-Cola one of the best dividend stocks on the market. It has increased its dividend annually for a ridiculous 63 straight years, making it a Dividend King. It currently pays out a dividend of $0.53 per share at a robust yield of 2.68%.
Crushing the S&P 500
In addition, Coca-Cola stock has performed well, up about 10% year-to-date. That blows away the S&P 500, which is down 4% in 2026. Roughly 80% of Wall Street analysts rate Coca-Cola stock as a buy, with a median price target of $86 per share -- roughly 12% higher than the current price.
Finally, Coca-Cola stock is trading at a reasonably cheap valuation at 25 times earnings, which is slightly below the S&P 500 average. Its forward price-to-earnings ratio is 23.
With its reliable dividend and steady outlook, investors should feel fairly confident that Coca-Cola stock will continue to navigate the noise and volatility in 2026.
Should you buy stock in Coca-Cola right now?
Before you buy stock in Coca-Cola, consider this:
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Dave Kovaleski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.