Warren Buffett doesn't measure the success of his favorite companies by short-term stock performance. So, when talking Buffett stocks, "unstoppable" doesn't mean one that's soared in the triple digits overnight. Instead, unstoppable Buffett stocks are ones that have delivered earnings and share price performance over time. Dividend growth often is an additional plus.
Two great examples are Coca-Cola (KO) and Johnson & Johnson (JNJ -0.46%). Both of these companies have turned investors' sitting cash into growing wealth, thanks to all three of those elements over time. And they may do the same for you.
Let's take a closer look at these top Buffett players.
1. Coca-Cola
Coca-Cola has grown earnings over time into the billions of dollars thanks to its brand strength. The company hasn't just relied on its flagship beverage, though. Coca-Cola sells 200 master brands in a variety of categories -- from hydration, tea, and coffee to juices and sparkling beverages. As the world's biggest nonalcoholic beverage maker, it brings its products to more than 200 countries.
In spite of this leading position, Coca-Cola still has room to grow, especially in emerging markets. There, commercialized beverages represent a low percentage of what people drink -- only about 30%. And Coca-Cola right now holds a 6% volume share. So this could be a key growth market for the company in coming years.
Meanwhile, Coca-Cola's managed to increase earnings and raise prices even during today's difficult economic environment. In the most recent quarter, the beverage giant reported gains in global unit case volume, revenue, and earnings per share.
Coca-Cola also scores a win when it comes to dividends. As a Dividend King, it's increased its payment for more than 50 consecutive years. And its high levels of free cash flow show the company has what it takes to keep doing so.
KO Free Cash Flow data by YCharts
All of this means Coca-Cola is the perfect spot to park your cash -- and potentially drive away with a lot more of it years down the road.
2. Johnson & Johnson
Johnson & Johnson is another company that has increased earnings over the long haul. It brings in billions of dollars annually. And today, this healthcare company may be about to enter a new phase of growth. That's because it's spinning off the unit that sells its most well-known products -- items like Band-Aid bandages and Tylenol.
I'm talking about the consumer health business -- one that has brought J&J fame, but not much growth in recent years. Moving forward, though, J&J will rely on its two higher-growth businesses. These are pharmaceuticals and medtech.
J&J will have the time and resources to focus on these areas. And slower growth in consumer health will no longer weigh on earnings. The business has become a separate entity called Kenvue.
Today, J&J's medtech business is made up of 12 platforms that generate more than $1 billion in annual sales. And J&J is working to grow total pharmaceuticals revenue to $60 billion from $52 billion last year. That's even as its blockbuster immunology drug, Stelara, loses exclusivity.
Like Coca-Cola, J&J is a Dividend King. And, like the beverage maker, J&J's high level of free cash flow makes the idea of ongoing dividend growth possible.
It's also important to remember that dividends add to the overall performance of the stock. In both cases, these stocks advanced over time -- but dividends offered investors an even bigger gain.
So, even though Coca-Cola and J&J may not deliver enormous increases overnight, that's OK. Over time, these stocks have proven they can grow wealth -- through stock market performance and dividend payments. That's a big reason Warren Buffett favors these stocks. And that's why long-term investors may choose to invest their sitting cash into these winning stocks, too.
