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Billionaire Och’s Big Dividend Stocks (Or Two Out Of Three Ain’t Bad)

Daniel S. Och‘s OZ Management LP is among the hedge funds that recently filed their 13F with the U.S. Securities and Exchange Commission for the reporting period of March 31. Based on the filing, the fund had $30.85 billion in holdings in its public equity portfolio, down from $36.69 billion the previous reporting period. OZ Management LP is one of the biggest hedge funds in the world and is constantly tracking its investment performance and making adjustments accordingly, with a large degree of turnover during each quarter. The firm was founded in 1994 by billionaire Och. It leverages a multi-dimensional investment strategy and invests in diverse geographical locations. It boasts stakes in many industries, including services, healthcare, technology, basic materials, and more. Insider Monkey has great interest in the fund due to its investment approach and acumen. In this article, we will take a look at the big dividend stocks carried by Och, which all sport dividend yields of close to 5%. Those stocks are Markwest Energy Partners LP (NYSE:MWE), Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR), and Williams Companies Inc (NYSE:WMB).

Och-Ziff Capital Management

Why are we interested in the 13F filings of a select group of hedge funds? We use these filings to determine the top 15 small-cap stocks held by these elite funds based on 16 years of research that showed their top small-cap picks are much more profitable than both their large-cap stocks and the broader market as a whole. These small-cap stocks beat the S&P 500 Total Return Index by an average of nearly one percentage point per month in our backtests, which were conducted over the period of 1999 to 2012. Moreover, since the beginning of forward testing from August 2012, the strategy worked just as our research predicted, outperforming the market every year and returning 142% over the last 32 months, which is more than 84 percentage points higher than the returns of the S&P 500 ETF (SPY) (see more details).

Daniel S. Och
OZ Management

OZ Management held 3.32 million shares of Markwest Energy Partners LP (NYSE:MWE), with a market value of $219.36 million, representing a big increase from the 674,847 shares that it held at the end of 2014. The company, which is the second-largest oil and gas company in the U.S., performed dismally in the first quarter. It posted $0.14 in earnings per share on revenue of $467.30 million, missing analysts’ consensus earnings per share estimate by $0.03 and missing revenue estimates by $109.39 million. Year-over-year, the company’s revenue was down by 8.8%. Analysts are expecting Markwest Energy Partners LP (NYSE:MWE) to post earnings per share of $0.84 for the current fiscal year. The company recently announced a dividend of $0.91 per share with the ex-dividend date being May 5. The dividend rate provides a current yield of 5.92%. A total of 11 hedge funds were invested in the stock during the first quarter, having an aggregate of $569.12 million in investment value. Stockbridge Partners is very high on this dividend stock, owning 3.17 million shares and having public equity exposure of over 11% to it.

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