No significant setbacks are anticipated, though it’s impossible to assure that stock prices won’t suddenly face another downturn and drop again.
Even so, experienced investors recognize that short-term declines often present long-term buying chances. If you’re savvy about investing, chances are good you already have a few preferred stocks ready to go, just in case the market experiences any kind of dip.
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With that in mind, let’s dive into three dividend stocks favored by renowned investors. Warren Buffett has mentioned he would definitely buy if the market takes a hit.
Coca-Cola (NYSE:KO) isn’t just a dividend-paying stock that Buffett seems fond of; he has held it in his Berkshire Hathaway portfolio for quite some time now, making it the third-largest holding, valued at over $30 billion.
This ongoing optimism makes sense when you consider that Coca-Cola has increased its annual dividend for an impressive 64 years in a row. The anticipated future yield is around a decent 2.7%, but new competitors could enter the fray.
Regarding shares already owned by Berkshire, if Mr. Buffett were still at the helm as the CEO and lead stock picker, it’s likely he would add to Berkshire’s existing position in Chelsea (NYSE:CVX), an oil giant. Currently, the future yield sits at 3.7%. He was actively increasing the role until he stepped down last year.
Considering the current discourse on transitioning from fossil fuels to renewable energy, one might think that this option has a brief lifespan and limited growth. However, the reality suggests we won’t be moving away from oil any time soon. The International Energy Agency estimates that global oil consumption will continue to rise until 2050, which bodes well for companies like Chevron.
Lastly, don’t forget to consider McDonald’s (NYSE:MCD) among your dividend stock options if the market takes a downturn.
While neither Buffett nor Berkshire Hathaway owns this stock currently, it certainly boasts many of the characteristics he typically favors, such as a compelling competitive edge, reliable cash flow, and management focused on delivering returns for shareholders. McDonald’s checks all those boxes, plus it offers a forward expected dividend yield of 2.4%.
It’s interesting to note though, while they’re famous for burgers, they have a unique business model. McDonald’s operates primarily as a real estate rental company. They collect market-rate rents from franchise owners, who run about 95% of the restaurants and generate the bulk of the company’s higher-margin income.
This model seems to work. Reliable rental income, irrespective of swings in fast food demand, is a big reason the company has increased its dividend per share annually for the last 49 years.
Before investing in Coca-Cola stock, here’s something to ponder:
Our analysts at Motley Fool Stock Advisor have pinpointed their choices for the top 10 stocks to buy right now, and Coca-Cola isn’t on that list. These ten have great potential for impressive returns in the coming years.
Looking back, consider Netflix. When it was first recommended on December 17, 2004, a $1,000 investment would now be worth about $555,526! Similarly, for Nvidia, if you had invested $1,000 when it was recommended on April 15, 2005, you’d have around $1,156,403!
What’s essential to highlight is that Stock Advisor boasts an average return of 968%—compared to the S&P 500’s 191%—so it’s clear that this is an outperformance worth noting.
Explore our latest Top 10 stocks.
*Stock Advisor returns on April 12, 2026.
James Brumley has a position at Coca-Cola. The Motley Fool holds shares in and recommends Berkshire Hathaway and Chevron. Additionally, they recommend long January 2028 $320 calls on McDonald’s and short January 2028 $340 calls on it. You can check their disclosure policy for details.
3 Dividend Stocks Warren Buffett Would Buy in a Market Crash
