What Are The 5 Highest Yielding Stocks in Warren Buffet’s Portfolio?
With interest rates near record lows, many investors are turning to dividend stocks to receive a higher rate of return. However, it is becoming increasingly important to select high quality companies that can sustain dividend payments to investors. Thankfully, Warren Buffett has a provided an example of dividend companies to invest in through Berkshire Hathaway’s (NYSE:BRKB) portfolio.
Although the legendary value-investor does not see a reason to issue his own dividend to shareholders, he often holds positions in companies that do. As of the end of 2011, Berkshire held 34 stocks, of which 28 currently pay a dividend.
Here’s a look at the five highest yielding stocks in Buffett’s portfolio:
The top three highest yielding stocks are all related to the medical field. GlaxoSmithKline (NYSE:GSK) is the highest with a dividend yield of 5 percent. The company is the world’s third largest pharmaceutical company measured by revenues and employs more than 96,000 people. At the end of the fourth quarter, Buffett held 1.51 million shares of the company. Year-to-date, GlaxoSmithKline shares have fallen almost 2 percent, but have increased 56 percent in the past three years.
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With a dividend yield of 4.6 percent, Sanofi SA (NYSE:SNY) is the second highest yielder for Buffett. The company has a market capitalization north of $100 billion and employs almost 102,000 people. Sanofi engages in the research and development, manufacturing and marketing of pharmaceutical products in the prescription market, as well as the over-the-counter market. Based on prescription sales, it is the world’s fourth largest pharmaceutical company. At the end of the fourth quarter, Buffett held just over 4 million shares. Year-to-date, Sanofi shares have increased almost 3 percent.
Despite reducing his stake in the fourth quarter, Buffett still held 29 million shares of Johnson & Johnson (NYSE:JNJ) going into 2012. A long list of product recalls and quality problems have caused the consumer healthcare company to lose more than $1 billion in sales. In a recent interview, Buffett said J&J still remains an attractive business at its price, but would be willing to sell it if he needed capital. J&J currently pays a 3.57 percent dividend, as shares have remained flat for the year. However, over the past three years shares have increased 35 percent.
General Electric (NYSE:GE) is close behind with a dividend yield of 3.55 percent. The multinational conglomerate employs 300,00 people. The most recent data shows that Buffett holds almost 8 million shares of GE. The company is also infamous for having the best accounting team of any corporation. According to a report by Public Campaign, GE received a hefty tax refund of $4.7 billion between 2008 and 2010. Shares of the company have gained 6.9 percent year-to-date.
Although Buffett completely sold out of his ExxonMobil (NYSE:XOM) position in the fourth quarter, he still maintains a 29 million share position in ConocoPhillips (NYSE:COP), which is the fifth highest dividend yield found in Buffett’s portfolio. The oil giant employs almost 30,000 people, and currently pays a dividend of 3.4 percent. Shares have gained 6 percent this year, and have surged more than 115 percent in the past three years.
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