Many investors aren't aware that the stock portfolio of Bill Gates, America's wealthiest man, is a matter of public record. Gates invests in the stock market through a trading vehicle called Cascade Investment Group. Stockpickr decided to sort through Cascade's stockholdings and extract the stocks with the highest yields. These are the stocks that pay dividends to Gates. One of the high-yielding stocks that Gates owns is PNM Resources ( PNM), a company that generates and distributes electricity and natural gas in New Mexico and Texas. Just over two weeks ago, Jefferies & Co. upgraded the stock from hold to buy. The stock, which has a price-to-earnings (P/E) ratio of 14 and a P/E-to-growth (PEG) ratio of 1.7, pays a generous yield of 3.8%. PNM was recently added to the portfolio of Lord Abbett Small-Cap Value Y (LRSYX), which is rated five stars by Morningstar. This fund, which invests at least 80% of its net assets in equity securities of small companies in the Russell 2000, has generated an average annual return of 18% over the last three years. The fund also owns Quanex ( NX), a vehicle and building products company that offers a yield of 1.2%, and Black Hills ( BKH), an electric utility that serves South Dakota, Wyoming and Montana, yielding 3.1%. Another high-yield stock Gates owns is Otter Tail ( OTTR), a Minnesota-based electric utility that also delves into such diverse businesses as manufacturing polyvinyl chloride and polyethylene pipes, wind towers, diagnostic medical equipment, patient-monitoring equipment and dehydrated potato products. The stock offers a P/E of 21, a PEG of 4.2 and a yield of 3.2%.
Otter Tail is also featured in Sleepers, an interesting portfolio on Stockpickr that also contains MDU Resources Group ( MDU), which yields 2.1%, and Applied Materials ( AMAT), which yields 1.2%.
Republic Services ( RSG) is another Gates dividend stock. The company is in the non-hazardous solid waste collection and disposal services business. Its earnings call is scheduled for Nov. 6. The stock offers a P/E of 23, a PEG of 2 and a yield of 2%. Republic appears in Stockpickr's Insider Purchases and Buybacks XV, a recent portfolio that lists stocks with significant insider purchases or stock buyback programs. The portfolio also includes Janus Capital Group ( JNS) and GlaxoSmithKline ( GSK), both of which are dividend-paying stocks. To see all of the highest-yield stocks owned by America's wealthiest man, check out the Top-Yielding Bill Gates Stocks, which includes two stocks with yields north of 5%. And for all of Gates' stocks, check out the Cascade Investment portfolio at Stockpickr.com.