Billionaire Ken Fisher’s Dividend Picks Include Philip Morris

Fisher also liked Philip Morris International Inc. (NYSE:PM), increasing its stake in the international cigarette company by 5% to a total of 5.7 million shares. Philip Morris is another stock whose relationship to changes in the market is closer than would normally be expected for its industry, with a beta of 0.9. Its dividend yield of 3.7% is also below what we see at some other U.S. focused cigarette companies, though of course not low in absolute terms. Renaissance Technologies, founded by billionaire Jim Simons, was also buying Philip Morris last quarter (check out Renaissance’s stock picks).

GlaxoSmithKline plc (NYSE:GSK)’s dividend payments tend to fluctuate, but over the last four quarters it has made $2.35 in dividend payments and that equates to a yield of over 5% at the current price. The pharmaceutical company is bit more defensive in nature as well as its beta is 0.5, though revenue and earnings were both down in the fourth quarter of 2012 versus a year earlier. Arrowstreet Capital owned 6.3 million shares of GlaxoSmithKline at the end of the year, up slightly from the beginning of October.

The 13F disclosed a position of 7.8 million shares in Rio Tinto plc (NYSE:RIO), a global miner of aluminum and other minerals with a market capitalization of $96 billion. Obviously demand for basic materials is tied to macro factors and so Rio Tinto carries a beta of nearly 2, making it thoroughly unsuitable for investors who want to protect themselves from a downturn. However, the dividend yield is 3.5% and analysts consider it a potential value play with a forward P/E of only 7 and a five-year PEG ratio of 0.6. We would be skeptical of their bullishness but it’s possible Rio Tinto is at least worthy of further research.

Disclosure: I own no shares of any stocks mentioned in this article.