helps oversee about half a trillion dollars and is portfolio
manager of T. Rowe Price's Equity Income Fund, whose objective is
to "provide substantial dividend income as well as long-term
capital appreciation through investments in common stocks of
established companies." As such, Rogers has selected a number of
high-yielding companies for the fund's portfolio. Through his
guidance and strategy, the fund has returned 6.7% over the last
10 years and 9.42% year to date, compared to 0.06% and -1.02% for
The highest yielding stocks in the portfolio are: Nokia
), CenturyLink (
), Telefonica (
) and Sun Life Financial (
in 2007 when the phone maker traded for over $30. He reinitiated
a position this year with 7.5 million shares at an average of $5,
and added 7 million additional shares when the stock dropped even
further, to $3, in the second quarter. Since then the stock has
dropped over 44%, for an overall downward spiral of 95% over the
last five years. Today a share of Nokia costs $1.82.
Nokia's struggling stock price has come amid $1 billion losses
and a thus far unsuccessful bid to compete in the crowded smart
phone market. The company's second-quarter report, released
Thursday, showed a loss per share of 0.38 euros, compared with a
loss per share of 0.10 euros in the same period of 2011, its
fourth straight quarter of losses. Year-over-year net sales fell
19% to $7.5 billion.
These turns of events have made the company a target of
investigation for value investors. In spite of losses, Nokia
still has a strong balance sheet, with more than $20.2 billion in
cash and only $6.1 billion in long-term liabilities and debt.
Free cash flow has also been strong for the entire decade. Net
margins, however, have been deepening for the last three
quarters, their worst point at 21.4% in the first quarter.
The company is exerting more effort with its Lumia smart phone to
bolster sales. In the second quarter, it increased sales to 4
Nokia pays a dividend yield of 9.5%.
has held CenturyLink, a communications services company, since
the second quarter of 2011, when it traded for an average of $41
per share. Thursday is trades for $41.60 after advancing almost
10% in the last year.
CenturyLink has grown marginally over the last decade. Its annual
growth rate has been 5.2%, and EBITDA 3.6%. In addition, it has
added more cash to its balance sheet in the last several years,
to a total of $2.4 billion, with more than $30 billion in
long-term liabilities and debt.
In 2011, CenturyLink's sales almost doubled when it integrated
Embarq and closed the acquisition of Qwest, making it the
third-largest telecommunications company in the country. It also
acquired Savvis Inc., a global leader in cloud infrastructure and
hosted enterprise IT solutions, in 2011. In five years, the
company's revenues jumped from about $2.5 billion to $18 billion.
In 2011, CenturyLink returned $1.6 billion to shareholders in
stock repurchases and dividends, increased from $896 million, and
the fourth increase since 2007. It currently pays a $0.73
quarterly dividend, with a dividend yield of 7.1%.
Rogers' fourth-largest dividend payer is Spain-based
. The stock price has been cut almost in half since he first
purchased 4,361,775 shares in the second quarter of 2011 at an
average price of $24. He made several small purchases over 2011
and added 78 shares in the second quarter of 2011 when the stock
had dropped to an average of $13. With the financial crisis in
Europe, the stock dove almost 30% year to date.
Telefonica's last five years of sales have fluctuated, but had an
overall annual growth rate of 6.6%. EBITDA grew at an annual
average rate of 15.3% in the same period. Telefonica has
generated over $10 billion in cash flow in the last five years
and has a strong balance sheet, with approximately $22 billion in
cash, down slightly from last year. Telefonica's long term
liabilities and debt are approximately $92 billion.
Telefonica currently trades for a low P/E of 3.1 and has a
dividend yield of 6.8%.
Rogers bought 4 million shares of
Sun Life Financial (
the Sun Life Assurance Company of Canada holding company,
in the fourth quarter of 2009 at an average price of $28, and has
made several small sales since then, culminating in a 200,000
share sale in the second quarter of 2012 at an average price of
Sun Life Financial this year has made a resurgence of 18.5% after
declining almost 55% overall in the last five years.
Sun Life's revenue has been declining since 2009, and net income
collapsed from $1.7 billion in 2010 to a net loss of $201 million
in 2011. In the first quarter of 2012, the company had favorable
results reflecting the impact of positive equity markets, higher
interest rates and business performance.
Sun Life pays a dividend yield of 6.7%.
See the rest of the stocks in
. Also check out the Undervalued Stocks, Top Growth Companies and
High Yield stocks of Brian Rogers.About GuruFocus: GuruFocus.com
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