Jim Simons' Favorite High Dividend Stocks

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 |  Includes: ADI, AFL, BMY, CEL, CTL, CVX, GE, INTC, JNJ, LLTC, LLY, LO, MCHP, NVS, PCG, PDLI, PG, PHI, PM, T, TEO, TSM, VGR, VOD
by: Insider Monkey

Jim Simons' Medallion Fund is the best hedge fund that we have come across. The firm charges a fixed 5% management fee and takes 44% of the returns generated. After these expenses are deducted Medallion provided an average annual return of 35% to its investors. A couple of months ago, our calculations showed that Medallion's annual alpha is 34%. The success of Medallion fund is why Jim Simons is one the wealthiest people on the planet.

Medallion fund usually trades in small quantities. The median position size is less than $2.5 million. However, Jim Simons has some positions in his portfolio that are as large as $445 million. These positions were probably acquired for Simons' Renaissance Institutional Equities Fund (RIEF). RIEF isn't nearly as successful as Medallion but managed to beat the index funds since inception.

We compiled Jim Simons' high dividend stock picks that were at least $50 million at the end of June. We required a minimum dividend yield of 3% and yields were obtained from Finviz. Here are Simons' favorite high dividend stock picks:

Stock

P/E

Dividend Yield

Return (52- week)

CELLCOM ISRAEL LTD (NYSE:CEL)

6.5

16.0%

-10.9%

PDL BIOPHARMA INC (NASDAQ:PDLI)

8.4

10.3%

15.5%

VECTOR GROUP LTD (NYSE:VGR)

19.3

8.6%

3.6%

CENTURYLINK INC (NYSE:CTL)

14.5

8.5%

1.2%

TELECOM ARGENTINA S A (NYSE:TEO)

8.2

7.1%

25.0%

PHILIPPINE LONG DISTANCE (NYSE:PHI)

N/A

6.5%

12.9%

AT&T INC (NYSE:T)

8.5

6.1%

8.2%

VODAFONE GROUP (NASDAQ:VOD)

10.7

5.5%

11.7%

VERIZON (NYSE:VZ)

15.9

5.5%

24.2%

LILLY ELI & CO (NYSE:LLY)

8.6

5.4%

11.0%

LORILLARD INC (NYSE:LO)

15.1

4.7%

43.8%

BRISTOL MYERS (NYSE:BMY)

15.1

4.6%

14.5%

TAIWAN SEMICONDUCTOR (NYSE:TSM)

11.0

4.4%

24.4%

MICROCHIP TECHNOLO (NASDAQ:MCHP)

14.3

4.4%

11.1%

PG&E CORP (NYSE:PCG)

15.5

4.4%

-9.7%

INTEL CORP (NASDAQ:INTC)

9.0

4.3%

10.2%

NOVARTIS A G (NYSE:NVS)

13.5

4.1%

12.5%

GENERAL ELECTRIC CO (NYSE:GE)

12.2

3.8%

5.6%

PHILIP MORRIS INTL INC (NYSE:PM)

15.6

3.8%

31.7%

JOHNSON & JOHNSON (NYSE:JNJ)

15.3

3.6%

12.6%

LINEAR TECHNOLOGY (NASDAQ:LLTC)

11.0

3.5%

-8.1%

AFLAC INC (NYSE:AFL)

9.2

3.4%

-29.6%

PROCTER & GAMBLE CO (NYSE:PG)

15.9

3.4%

7.1%

CHEVRON CORP NEW (NYSE:CVX)

8.4

3.2%

27.6%

ANALOG DEVICES INC (NASDAQ:ADI)

10.9

3.1%

11.0%

Click to enlarge

AT&T Inc recently traded at $28.05 and has a 6.13% dividend yield. T gained 8.18% during the past 12 months. The stock has a market cap of $166.2 billion and P/E ratio of 8.5. Simons had $95 million invested in T shares. This stock has a 16% profit margin an EPS growth rate of 18%. Phill Gross’ Adage Capital Management has one of the largest positions in T among the 300+ funds we are tracking.

Verizon Communications is a large telecommunications company operating worldwide. Verizon recently traded at $35.56 and has a 5.48% dividend yield. VZ gained 24.21% during the past 12 months. The stock has a market cap of $100.7 billion and P/E ratio of 15.88. Simons had $114 million invested in VZ shares. The stock has an 87% dividend payout ratio. Phil Gross' Adage Capital holds nearly $150 Million of VZ (check out Phill Gross’ other top holdings).

Lilly Eli & Co recently traded at $36.44 and has a 5.38% dividend yield. LLY gained 11.03% during the past 12 months. The stock has a market cap of $42.2 billion and P/E ratio of 8.55. Simons had $388 million invested in LLY shares.

Cellcom Israel provides cellular communications in Israel. CEL recently traded at $21.82 and has a 15.99% dividend yield. CEL lost 10.87% during the past 12 months. The stock has a market cap of $2.2 billion and P/E ratio of 6.51. Profit margin rests at about 18% while the five-year historical EPS growth rate is 28%. Simons had $63 million invested in CEL shares.

PDL Biopharma Inc recently traded at $5.8 and has a 10.34% dividend yield. PDLI gained 15.54% during the past 12 months. The stock has a market cap of $810 million and P/E ratio of 8.41. Simons had $61 million invested in PDLI shares. Seth Klarman’s Baupost Group reduces its PDLI shares by 12% during the second quarter of 2011. Klarman had $54 million invested in PDLI at the end of June (check out Seth Klarman’s top holdings).

Vector Group Ltd. is a holding company providing cigarettes, alcoholic beverages and real estate in the United States. VGR recently traded at $18.72 and has a 8.55% dividend yield. VGR gained 3.6% during the past 12 months. The stock has a market cap of $1.4 billion and P/E ratio of 19.3. Simons had $70 million invested in VGR shares. In the past 5 years, VGR increased its dividend payments 5.00% on average. Carl Icahn’s Baupost Group, Andy Redleaf’s Whitebox Advisors and Cliff Asness’ Aqr Capital also hold large VGR positions. (See Carl Icahn’s favorite stock holdings here).

Centurylink Inc recently traded at $34.15 and has a 8.49% dividend yield. CTL gained 1.22% during the past 12 months. The stock has a market cap of $21.1 billion and P/E ratio of 14.47. Simons had $79 million invested in CTL shares.

Telecom Argentina recently traded at $22.79 and has a 7.07% dividend yield. TEO gained 24.95% during the past 12 months. The stock has a market cap of $2 billion and P/E ratio of 8.2. Simons had $62 million invested in TEO shares.

Philippine Long Dıitance Tel recently traded at $55.94 and has a 6.53% dividend yield. PHI gained 12.92% during the past 12 months. The stock has a market cap of $12.2 billion and P/E ratio of 0. Simons had $94 million invested in PHI shares.

Vodafone Group recently traded at $26.32 and has a 5.48% dividend yield. VOD gained 11.71% during the past 12 months. The stock has a market cap of $138.5 billion and P/E ratio of 10.7. Simons had $128 million invested in VOD shares. Boykin Curry’s Eagle Capital Management also has a very large position in Vodafone.

Disclosure: I am long CTL, T, VOD, PM.