3 Cheap Dividend Stocks That Helped Warren Buffett Earn $3.7 Billion in Dividends in 2017

Graham Holdings Co (NYSE:GHC)

How Many Shares Berkshire Owns: 107,575

How Much Money Berkshire Has Invested in the Stock: $60.07 million

Graham Holdings Co (NYSE:GHC) Annual Dividend Yield: 0.88%

Buffett Maintains Small Tie to Graham Family: Buffett has also been an investor of this stock for decades, dating back to when it was called The Washington Post Company. The investment lead to Buffett developing a close relationship with Katherine Graham, who led her family’s newspaper as its publisher for two decades. That particular asset was sold to Amazon.com, Inc. (NASDAQ:AMZN) in 2013 and by early-2014, Buffett had exited the majority of his stake in the company after coming to terms on a deal that exchanged his shares for some of the company’s media assets. He retained 107,575 shares, which he still holds to this day.

What is Graham Holdings Co (NYSE:GHC) Up To Now?: With The Washington Post long gone as one of its primary assets, Graham Holdings now relies on its Education division to provide the bulk of its revenue ($1.52 billion in 2017). However, the Education division’s revenue and income declined in 2017, with income from higher education shrinking by 34% year-over-year. The Television Broadcasting division was also hit hard by an operating income decline of 32% last year, which the company blamed on vastly increased network fees at its two NBC affiliates.

Store Capital Corp (NYSE:STOR)

How Many Shares Berkshire Owns: 18.62 million

How Much Money Berkshire Has Invested in the Stock: $485 million

Store Capital Corp (NYSE:STOR) Annual Dividend Yield: 5.17%

Buffett Enters the REIT Space: Buffett added just a handful of major positions to Berkshire’s portfolio in 2017, one of which was this large stake in Store Capital Corp (NYSE:STOR), added in the second-quarter of last year. It represented Buffett’s first investment in a real estate investment trust (REIT), an industry that seems to be a natural fit for the Oracle of Omaha.

Not Your Average REIT: Unlike some REITs, which are highly reliant on companies in the struggling retail sector to rent their properties, Store Capital has limited exposure to the retail sector through its more than 1,800 properties, which have a collective occupancy rate of 99%. The company’s long-term leases inked with high-quality tenants make it one of the most stable REITs, with built-in rent escalators that will keep its FFO growing and its already-impressive dividend payments rising.

Hedge Fund Ownership of Store Capital Corp (NYSE:STOR): As of the end of 2017, 15 hedge funds in our database owned 12.1% of Store Capital Corp’s shares, worth $599 million. Berkshire’s position accounted for the bulk of that figure, while real estate specialist AEW Capital, lead by Jeffrey Furber, also owns a large stake in Store Capital, valued at over $56 million.

Disclosure: None