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Best Buffett Buys - 39796 views
Be fearful when others are greedy, and be greedy when others are fearful -- Warren Buffett
Warren Buffett believes that since others are afraid of the stock market, now is the time to start buying stocks. He's even practicing what he preaches, buying stocks for his own account. Since the CEO of Berkshire Hathaway (BRK.A) is the richest man in the world and since he made his money through investing, maybe we should pay attention.
In particular, we might want to look into which high-yielding stocks he owns. As a matter of fact, the sixth-most-viewed portfolio on Stockpickr is High-Yield Warren Buffett Stocks.
One of the highest-yielding Buffett stocks is Home Depot (HD), with a 4.5% yield. Credit Suisse just upgraded the company to outperform, and a Citibank analyst said that Home Depot's discounted prices on store items are increasing sales of those products. The stock has a P/E of 10 and a PEG of 1.08.
Home Depot is favored by Edward Lampert, the founder, chairman and CEO of ESL Investments, a $10 billion investment fund that has reportedly returned close to 30% annually since inception. He was instrumental in the merger of Kmart and Sears, creating Sears Holdings (SHLD). He formerly worked at Goldman Sachs (GS). Lampert also favors AutoZone (AZO) and Compania Cervecerias Unidas (CCU), neither of which pays a dividend, as well as Citigroup (C), which yields 8.6% based on previous dividend payments.
Another high-yielding Buffett stock is Kraft Foods (KFT), which has a yield of 4.1%. The company was just upgraded by DA Davidson from underperform to neutral. Kraft received the 2008 Most Innovative Company award from Consumer Goods Technology magazine. The stock has a P/E of 18 and a PEG of 1.94.
Kraft is also owned by Eton Park Capital, which is managed by Eric Mindich with over $5 billion under management. He was formerly the youngest partner at Goldman Sachs at the age of 27. Eton Park also owns Merrill Lynch (MER), which yields 7.7% based on previous dividends; and Hospira (HSP) and VeriSign (VRSN), neither of which pays a dividend.
ConocoPhillips (COP) yields 3.6% and is owned by Buffett. Its third-quarter conference call will be held on Oct. 22. The stock has a P/E of 5 and a PEG of 0.43.
Conoco is owned by George Soros, one of the most successful hedge fund investors and the founder of the Quantum Fund. Soros also owns Hess (HES), yielding 0.8%; Consol Energy (CNX), yielding 1.2%; and Halliburton (HAL), yielding 2%.
For more high-yielding Warren Buffett stocks, check out the Stockpickr.com portfolio.
Posted on Oct. 21, 2008