Billionaires Are Buying These Big Dividends

Billionaire investors can’t get enough of Brookfield Asset Management (TSX:BAM) stock.

| More on:

If you’re looking for stock ideas, you could do worse than look at the portfolios of billionaire investors. Not everybody with a billion dollars is necessarily smart, but those who got their billions by managing money over periods of decades usually are.

These days, many such people are heavily invested in tech stocks that offer little to no yield. Warren Buffett has Apple, Stanley Druckenmiller has NVIDIA, and Bill Ackman has Google. Nevertheless, if you’re a dividend investor looking for high-yield names with billionaire backing, you can find them. In this article, I will explore three stocks with (relatively) high dividend yields that billionaires can’t seem to get enough of.

Brookfield Asset Management

Brookfield Asset Management (TSX:BAM) is a Canadian financial services company whose shares have a 3.74% dividend yield. It was recently purchased by billionaire Canadian investor Bruce Flatt, who had previously sold the stock in order to purchase shares in its parent company, Brookfield (TSX:BN). Flatt currently owns more than $3 billion worth of BN and BAM stock (he is the chief executive of the former).

What does Brookfield Asset Management do? Mainly, it manages funds for wealthy investors. These include real estate investment trusts (REITs), alternative asset funds, and others. The company collects fees for managing these funds. Brookfield invests in the funds, so the company’s incentives align well with the way it earns its fees.

I recently sold my Brookfield Asset Management shares, but it was not due to changing my opinion on the company or anything like that. I was just sitting on a nice gain and felt it prudent to invest the sales proceeds into a lower-risk, 5% yielding Guaranteed Investment Certificate (GIC).

Torm PLC

Torm PLC (NASDAQ:TRMD) is a Danish shipping company that transports crude oil and other petroleum-related products. Its yield is hard to peg down because it is in a cyclical industry, and its payout goes up and down a lot. Going by the last 12 month’s dividends, the yield is about 21%. That’s a pretty high yield, although the odds of it continuing to be that high in the future are much lower than 100%.

Torm, as a tanker company, plays a vital role in the world’s economy. It ships oil all over the world, making shipments from major supplier countries like Saudi Arabia. It is owned by legendary investor Howard Marks, who has a 19% compounded annual growth rate (CAGR) career track record.

Chevron

Chevron (NYSE:CVX) is an energy stock owned by billionaires Warren Buffett and Stanley Druckenmiller. It has a 4.3% dividend yield.

Chevron is a diversified energy company involved in exploration and production (E&P), refining and transportation. It owns valuable assets in the Permian Basin, one of the most productive oil-producing regions in the world.

Chevron stock is pretty cheap at today’s prices. Trading at 11.7 times earnings, 1.36 times sales and 1.7 times book value, it is only half as richly valued as the average S&P 500 stock. Despite a brief energy scare in 2022, the countries of the world don’t look all that eager to transition to nuclear energy. There are significant investments being made in renewables but they still supply only a small percentage of the world’s electrical grids. So, oil will probably be relevant for the foreseeable future, and Chevron will likely thrive along with the commodities it sells.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Fool contributor Andrew Button has positions in Alphabet, Apple and Brookfield. The Motley Fool recommends Alphabet, Apple, Brookfield, Brookfield Asset Management, Brookfield Corporation, Chevron, and Nvidia. The Motley Fool has a disclosure policy.

More on Dividend Stocks

A plant grows from coins.
Dividend Stocks

3 Dividend-Growth Champions That Could Keep Raising Payouts in Any Market

These three Canadian stocks with consistent dividend growth are excellent buys to boost your passive income and strengthen your portfolios.

Read more »

ways to boost income
Dividend Stocks

TFSA to $100K: 2 Dividend-Growth Stocks to Power a Tax-Free Fortune

Building a tax-free fortune through the TFSA is possible with two top-tier dividend-growth stocks.

Read more »

dividends can compound over time
Dividend Stocks

1 Magnificent Canadian Dividend Stock Down 21% to Buy and Hold for Decades

Down 21% from all-time highs, TD Bank is TSX dividend stock that offers a tasty dividend yield of 5.1% in…

Read more »

senior man smiles next to a light-filled window
Dividend Stocks

Canadians: 3 Big Changes Coming to CPP and OAS in 2025

If you don't expect to get enough CPP and OAS to retire, you can invest in ETFs like iShares S&P/TSX…

Read more »

woman retiree on computer
Dividend Stocks

2 Stocks Canadians in Their 50s Should Own

Choosing the right growth stocks when you are just a few years away from your retirement can have enormous implications…

Read more »

Man data analyze
Dividend Stocks

Invest $33,000 in These 2 Canadian Stocks to Cash in on Trump’s Tariffs

These two stocks may not seem the most obvious, but could see an increase in demand as tariffs come down…

Read more »

Dividend Stocks

Prediction: Here Are 2025’s Most Promising Canadian Stocks

From energy giants to e-commerce pioneers, discover three Canadian stocks poised for growth in 2025 as they leverage market leadership…

Read more »

sale discount best price
Dividend Stocks

These 3 Stocks Are a Steal at Their Current Price

Not all discounted stocks are good deals. The size of the discount should always be reconciled with the probability, scale,…

Read more »