When it comes to oil, nobody is better than T. Boone Pickens. His fund has made billions in the past few years trading the stuff, and now he's calling for $80-a-barrel oil and his stocks are all bets on oil going in that direction.
The great thing about oil-related companies is that they spin off a lot of cash. In the best case for us, the shareholders, they use that cash to pay dividends. At Stockpickr, we are keeping track of
. We also keep track of
His highest-yielding stock is
, which has a yield of 2.1%. Conoco has paid dividends for more than 20 years, and this year raised its quarterly dividend to 41 cents from 36 cents. The stock has a low P/E of 8.4 and a PEG of 1.27. Also, the stock was recently upgraded to outperform by Bernstein.
This is all a very nice setup, and we like that T. Boone is in the stock, but it was also good to see that the she stock was also recently added to the portfolio of
, which was up 15.3% in 2006.
And of course, you can't overlook the fact that the stock is also a part of the
, which has outperformed the
by more than 20% over the last three years. Other components of this list include
Pickens also owns
, a stock that generates a yield of 1.5%. Oxy Pete raised its quarterly dividend last year to 22 cents from 18 cents per share.
recently acquired the stock, which has a P/E of 12 and a PEG of 1.54. Dreman Value Management is one of the pioneers of contrarian value investing. Its investment philosophy is based on a disciplined, low P/E approach to stock selection.
Additionally, our own Jim Cramer recently made OXY one of his
saying, "I am never going to say that Occidental shouldn't be bought because it has an 11 multiple and that's too high. That's nuts! These stocks are cheap and they are hardly value traps. They are companies that control their own destiny right now." Others on this list include
Next on the Pickens list is
, an Oregon-based company that manufacturers railroad freight car equipment. They have paid quarterly dividends for 12 years, and the current yield is 1% but the company trades for only 10 times cash flow. The key here is that the four big rails are flush with cash.
The Railway Tie Association expects that 21 million railroad ties will be sold this year -- a lot more than usual. Low supply and high demand usually means higher prices. They are going to be buying a lot of equipment. And this is where a company like Greenbrier should benefit.
Again, you can see
at Stockpickr.com, or just a list of his
At the time of publication, Altucher and/or his fund had no positions in stocks mentioned, although positions may change at any time.
James Altucher is president of Stockpickr LLC, a wholly owned subsidiary of TheStreet.com and part of its network of Web properties, and a managing partner at Formula Capital, an alternative asset management firm that runs several quantitative-based hedge funds as well as a fund of hedge funds. He is also the author of
Trade Like a Hedge Fund
Trade Like Warren Buffett
. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Altucher appreciates your feedback;
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