6 Cheap Stocks Paying a High Dividend Yield

Rio Tinto tops the list

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Sep 21, 2020
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According to the GuruFocus All-in-One Screener as of Sept. 21, the following guru-held companies have high dividend yields and are trading with low price-earnings ratios.

BHP

BHP Group PLC.'s (BBL) dividend yield is 5.28% and the payout ratio is 0.91. Over the past 52 weeks, the stock price has risen 7.40%. Shares are trading with a price-book ratio of 2.29 and a price-earnings ratio of 14.49. The company's average yield was 4.17% over the past 10 years.

The company, which supplies iron ore, copper, oil, gas and metallurgical coal, has a market cap of $115.28 billion. GuruFocus rated its profitability 8 out of 10. The return on equity of 16.52% and return on assets of 7.68% are outperforming 92% of companies in the metals and mining industry. The cash-debt ratio of 0.49 is few below the industry median of 16.83.

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Ken Fisher (Trades, Portfolio) is the company's largest guru shareholder with 0.25% of outstanding shares, followed by NWQ Managers (Trades, Portfolio) with 0.01%.

GlaxoSmithKline

GlaxoSmithKline PLC's (GSK) dividend yield is 5.11% with a payout ratio of 0.60. The stock has lost 0.64% compared to a year ago. Shares are trading with a price-earnings ratio of 11.47 and a price-book ratio of 5.63. The company's average yield was 5.06% over the past 10 years.

The pharmaceutical company has a $98.49 billion market cap. GuruFocus rated its profitability 8 out of 10. The return on equity of 62.45% and return on assets of 8.44% are outperforming 80% of companies in the drug manufacturers industry. The cash-debt ratio of 0.26 is few below the industry median of 0.84.

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Dodge & Cox is the company's largest guru shareholder with 1.66% of outstanding shares, followed by Jim Simons (Trades, Portfolio)' Renaissance Technologies with 0.82% and Fisher with 0.63%.

Rio Tinto

Rio Tinto PLC's (RIO) dividend yield 5.93% with a payout ratio of 0.87. Over the past 52 weeks, the stock has gained 22.10%. Shares are trading with a price-book ratio of 1.99 and a price-earnings ratio of 14.57.

The company has a market cap of $80.31 billion. GuruFocus rated its profitability 8 out of 10. The return on equity of 18% and return on assets of 8.29% are outperforming 93% of competitors in the metals and mining industry. Its financial strength is rated 6 out of 10. The equity-asset ratio of 0.63 is far below the industry median of 16.83.

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With 0.92% of outstanding shares, Fisher is the company's largest guru shareholder, followed by Simons with 0.13%.

Morgan Stanley

Morgan Stanley's (MS) dividend yield is 2.80% with a payout ratio of 0.25. Over the past 52 weeks, the stock has increased 16.05% and shares are trading with a price-book ratio of 1.01 and a price-earnings ratio of 9.04. The company's average yield was 1.46% over the past 10 years.

The pharmaceutical firm has a market cap of $78.96 billion and a GuruFocus profitability rating of 5 out of 10. While the return on equity of 10.5% is outperforming the sector, return on assets of 1.01% is underperforming 51% of competitors in the capital markets industry. Its financial strength is rated 3 out of 10 with a cash-debt ratio of 0.52.

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ValueAct Holdings LP (Trades, Portfolio) is the company's largest guru shareholder with 0.90% of outstanding shares, followed by Fisher with 0.54%, Richard Pzena (Trades, Portfolio) with 0.47% and T Rowe Price Equity Income Fund (Trades, Portfolio) with 0.42%.

Anthem

Anthem Inc.'s (ANTM) dividend yield is 1.38% and the payout ratio is 0.15. Over the past 52 weeks, the stock has increased 6.37%. Shares are trading with a price-earnings ratio of 11.48 and a price-book ratio of 1.93. The company's average yield was 1.40% over the past 10 years.

The private health insurance organization has a market cap of $66.45 billion. GuruFocus rated its profitability 7 out of 10. The return on equity of 18.49% and return on assets of 7.37% are outperforming 57% of competitors. Its financial strength is rated 5 out of 10. The cash-debt ratio of 0.28 is below the industry median of 0.65.

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With 1.86% of outstanding shares, Vanguard Health Care Fund (Trades, Portfolio) is the company's largest guru shareholder, followed by First Eagle Investment (Trades, Portfolio) with 0.86% and HOTCHKIS & WILEY with 0.66%.

Disclosure: I do not own any stocks mentioned.

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