Kraft Heinz Is One of the Top Dividend Payers in Bill Gates' $33 Billion Foundation Portfolio, an Income Play Other Investors Can Study

An interesting thing about famous investors is that they're not all investors by trade. Bill Gates, the 19th-richest person in the world, is an example of that.

Along with the late Paul Allen, Gates was a co-founder of Microsoft. Thanks to his Gates Foundation, a charitable organization, Gates is, in fact, a famous investor. The foundation manages $33 billion in assets, or slightly less than a third of Gates' net worth of $106.2 billion.

Kraft Heinz is a Gates Foundation holding, but it needs more than that to return to old highs. Image source: Getty Images.

Obviously, $33 billion is a lot of dough, and the Gates Foundation holds 22 equity positions, but nearly 78% of the portfolio is allocated to just four stocks: Berkshire Hathaway, Canadian National Railway, Waste Management, and Caterpillar. Further down the list is Kraft Heinz (NASDAQ: KHC), arguably one of the foundation's more intriguing holdings.

Investing like one of his buddies

Even the rich and famous aspire to invest like Warren Buffett, and the Gates Foundation is home to some stocks that look like Warren Buffett investments. That's interesting because Buffett and Gates are friends, and because Berkshire Hathaway, the company Buffett led, is one of Kraft Heinz's largest shareholders.

Like Buffett, Gates approached the ketchup maker with a long-term view. His foundation started a position in consumer staples stock nearly four years ago, so, like Berkshire, it's sitting on a dud. Unlike Berkshire, the Gates Foundation has shown a willingness to part with some of its Kraft Heinz, selling 150,000 shares in July 2025.

Buffett has admitted Kraft Heinz was one of his rare gaffes. Earlier this year, there was even chatter that under new CEO Greg Abel, Berkshire could consider parting ways with Kraft Heinz. That talk has since gone by the wayside, and the consumer staples stock is up an S&P 500-beating 9.5% year to date.

Without Gates and his investing team publicly explaining why they're sticking by Kraft Heinz, investors are left to guess. Maybe one of the lessons is that they can afford to endure a couple of duds. The Gates Foundation's average buy price on Kraft Heinz is $37.20, and the stock closed at $26.22 on July 27, confirming the foundation is saddled with a loser.

Perhaps another lesson is that even famous investors make mistakes (clearly, they do), and ordinary investors need to know how to avoid short-term losers becoming regrettable long-term commitments.

The dividend lesson

Another page from the Buffett playbook Gates adopted is an affinity for dividend stocks. While Berkshire itself isn't a dividend payer, the conglomerate has a long track record of owning dividend payers, including many known for consistently growing payouts.

At the Gates Foundation, Caterpillar and Waste Management, among others, check the dividend and payout growth boxes. With a yield of 6.2%, Kraft Heinz checks the dividend box, but it slashed the payout to conserve cash and reduce debt.

The Gates Foundation got involved several years later, potentially sensing a turnaround opportunity. That may play out because Kraft is generating $3.7 billion in free cash flow, and the dividend can provide some support for the shares, but the turnaround story needs to bear fruit.

Todd Shriber has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway, Caterpillar, and Microsoft. The Motley Fool recommends Canadian National Railway, Kraft Heinz, and WM. The Motley Fool has a disclosure policy.