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During the fourth quarter, Warren Buffett and Berkshire Hathaway bought up quite a bit of stock in National Oilwell Varco Inc., the Houston oil and gas giant. They held steady in their other two Houston-based companies.

Berkshire Hathaway, based out of Omaha Nebraska, chose not to touch Conoco Phillips, a Houston oil and gas exploration and production company. They didn’t add on to their Philips 66 shares either, which is the young spinoff of Conoco Phillips.

Even so, the Berkshire Hathaway Conoco Phillips investment rose by 1.4% to reach a total of $1.4 billion quarter over quarter. Their stake in Philips 66 rose 14.5% to $1.4 billion during the fourth quarter as well, we learned according to the Securities and Exchange Commission.

During the fourth quarter, Warren Buffett and Berkshire Hathaway increased their National Oilwell Varco holdings by 26.5%, and they now have more than 5.29 million shares. The value of the investment went up a total of 7.9% to reach $361.9 million.

It appears that many billionaire investors, right along with Warren Buffett, didn’t have such a rosy outlook for energy stocks during the third quarter.

If you are an investor, one of the best ways to make consistent returns is by buying big dividend stocks. One of the greatest investors of our time, Warren Buffett, successfully follow this approach when building his investing Empire.

That’s why I went through Warren Buffett portfolio and came up with a list of the best yielding dividend stocks from a Berkshire Hathaway’s fund. As of the 38 stocks that Berkshire Hathaway owns, 28 of them actually pay dividends. The stock that pays the highest dividend is GlaxoSmithKline, and they are a British drug company. Out of the top dividend stocks owned by Warren Buffett, they fall under the categories of newspapers, oil and gas, and drug companies.

As of the third quarter of 2012, there were 38 total stocks in Berkshire Hathaway’s portfolio worth a total of $75.326 billion. During this quarter, Buffett opened up four new positions and added onto eight other stocks already owned. His biggest and most important buys were with Deere and Wells Fargo. He increased his position in Wells Fargo by 2.8%, and the combination of the two buys change the portfolio by about half of a percent.

During the third quarter, Berkshire Hathaway also doubled their stake in General Motors, and open up a position in National Oilwell Varco. So you know, the average yield of Warren Buffett’s dividend stocks comes out to 2.44%, which isn’t a very high value. It definitely makes sense to up the yield for added value and growth.

The Top Three Berkshire Hathaway Holdings for Dividends:

GlaxoSmithKline has a current market capitalization of $107.43 billion. The company also employs 97,389 people, and they generate a total revenue of $44.060 billion. As well, they have a net income of $8.780 billion. Before avid or is a show in, depreciation, interest and taxes, the firm is worth $14.813 billion. The EBITDA margin is currently 33.62%, as well as the operating margin is 28.50% and they have a net profit margin of 19.93%.

Financial analysis: the total debt of the company represents 36.27% of their assets as well as the total debt in relation to the amounts of equity to the tune of 185.52%. Because of this particular financial situation, a return on equity of 62.19% is realized. During the 12 trailing months, their earnings per share reached the amount of $3.19. Last year the same time, the company only paid $2.25 out in dividends to its shareholders.

Market valuation: the company’s price ratios are as follows… The P/E ratio is 13.67, the PS ratio is 2.40, and the PB ratio comes in at 8.46. The total dividend yield amounts to 5.36%, and the beta ratio presents a value of 0.65.

Conoco Phillips comes in with a market capitalization of $69 billion. The company currently employs a total of 16,700 people and it also generates a total revenue of $251.226 billion. The net income of the company is $12.502 billion. The earnings of this firm before amortization, depreciation, taxes and interest comes to the amount of $31.891 billion. The margin of EBITDA is 12.69%, as well as the operating margin is 9.16% and the net profit margin of the company is 4.98%.

Financial analysis: the total debt of Conoco Phillips represents 14.76% of the total assets of the company and the total debt when you related to the equity amounts of 34.69%. Due to the financial picture of this business, they were capable of receiving a return on equity of 18.59%. The 12 trailing months showed an earnings-per-share that reached a value of $5.56. During the last fiscal year, the company paid out $2.64 in the amount of a dividend to its current shareholders.

Market valuation: the price ratios of the company are as follows… The P/E ratio is 10.23, the PS ratio is 0.28 and the current PB ratio comes in at 1.13. The amount of the dividend yield is 4.62% and the company’s beta ratio presents a value of 1.13.

Gannett currently holds a market capitalization of $4.05 billion. At the time of this writing, the company fully employs a total of 31,000 people. They generate a total revenue of $5.239 billion, and they also have a net income of $500.13 million. Before taxes, amortization, interest and depreciation, the firm’s earnings amount to $1.012 billion. The margin of EBITDA is 19.32%, and the operating margin is a total of 15.55% while the net profit margin is 9.54%.

Financial analysis, the company’s total debt represents 26.61% of the total debt and total assets when you relate them to the amount of equity of 75.62%. Due to the financial picture of this business, they realize a return of equity in the amount of 20.43%. The trailing 12 months EPS reached a value of $1.84. During the last fiscal year, the dividend to shareholders paid out was $.24.

Market valuation: here are the company’s price ratios… The P/E ratio is currently 9.58, the PS ratio has reached 0.79, and the companies PB ratio comes in at 1.84. The dividend yield is 4.43%, while the beta ratio presents a value of 2.50.

When you take a closer look at the entire table of the best dividend yielding stocks owned by Warren Buffett, you’ll see that the average P/E ratio is about 18.15, and the average forward P/E ratio is roughly 13.05. The dividend yield values at 2.44%. The price-to-book ratio comes in at 4.51 and the price to sales ratio is around 2.81. The operating margin meets the amount of 19.90% and the overall beta ratio is 1.03.

The one thing I can say for certain about Warren Buffett is that he typically gets his investments right.

And if you were paying attention, you would’ve noticed that he just made a new decision which has him picking up shares of National Oilwell Varco. Berkshire Hathaway recently added 2.8 million shares of this company to their overall portfolio, and they focus on drilling equipment in case you are wondering. This edition was made to the portfolio during the second quarter.

If you aren’t familiar with ticker symbol NOV, and I’d like to mention that they are an oil services company. This company is typically overshadowed by businesses such as Halliburton, Baker Hughes and Schlumberger. But they are an excellent company and they have even made some incredible acquisitions throughout the years. As a matter of fact, they have made over 300 purchases in the last 15 years alone.

National Oilwell Varco recently announced that they are involved in nine more takeovers, and six of them happened during the second quarter alone. This is the way that they strengthen their overall position in a very competitive business.

The last deal that they made was a $2.54 billion cash buyout of rival company Robbins & Myers. This is the biggest purchasing transaction that they have made since 2007, when they acquired Grant Prideco in the amount of $7.4 billion. And this deal is actually looking like it will be their most beneficial transaction to date as well.

It’s important to know that NOV is currently the leading manufacturer of blowout preventers. This is a type of oil drilling safety equipment that unfortunately gained credence during the BP oil spill that took place not that long ago.

Since that spill happened, there has been new legislation which passed that required two of these devices on each and every oil rig, whether they are onshore or offshore. NOV is the second-biggest supplier of these devices as far as the land drilling market is concerned. But now that they will be taking over Robbins & Myers, which happens to be the fourth largest in this area, it will now claim the biggest piece of this growing market as the dominant player.

Robbins & Myers actually has a process solutions business as well, and they are capable of selling reactors and storage units to chemical companies and pharmaceutical businesses through this division. It’s very important to note this the boom in natural gas has also increased the demand of ethane and propane, as well as other liquid chemicals. So this market is expanding into other areas of business.

The overall effect of this new addition to their bottom line is expected to bring about an extra $.25-$.35 per share. That is excellent when you are talking about a company whose revenue surged by 21%, and their income increased by 20% last year at this time. But better yet, NOV anticipates that there earnings growth will go up by 16.25% annually during a five-year period. Even though they have been acquiring many companies quite recently, they are still perfectly capitalized.

NOV currently maintains a profit margin of 13.6%, and their operating margin is at 19.82%. The operating cash flow that they have is $939 million. The balance sheet of this company is strong, and they have $1.92 billion in cash and just $1.45 billion worth of total debt.

There shares have rallied over 7% since the takeover announcement, the stock price of this company is still very much a steel. The current PE of the company is 14.64, and their price-to-book ratio is only 1.81. Their dividend yield is 0.6%. Plus, when you take into account that Berkshire Hathaway now owns it, the price is definitely going to move a lot higher because of this.

Two university professors conducted a study during 2007 which they titled Imitation Is the Sincerest Form of Flattery. This study showed us that every stock that Buffett bought, even if it’s only is a month later, will provide you with superior returns on your investment.

The study found that “A hypothetical portfolio that mimics Berkshire’s investments created the month after they are publicly disclosed… Earns positive abnormal returns of 14.26% per year.” So if you believe that you’re a smart investor, then you should follow Buffett’s lead and pick up some stock in National Oilwell Varco right away.

Would you like and find out what else Warren Buffett is up to? Berkshire Hathaway also added 27 million more shares of Phillips 66 to their portfolio. This comes as part of a Phillips spinoff from Conoco Phillips, and it’s a stock that Warren Buffett has had for many years. Berkshire Hathaway also liquidated their entire Intel position, and they let go of 64% of their position in Johnson & Johnson.

Please use this information and take it at face value.

Warren Buffett has some strict requirements when it comes to investing in companies. Cheapness is one major factor that he looks for, but he also has to find high-quality companies that are very affordable. So it obviously makes sense that his portfolio is going to contain many low P/E companies. I’d like to fill you in on the lowest now which are General Motors Company (GM), Conoco Phillips (COP), Gannett Co. Inc. (GCI) and General Dynamics Corp. (GD).

A low P/E (price to earnings) ratio is a strong indicator which tells you when a company’s earnings have grown or stayed flat, but the price hasn’t for whatever reason and should eventually end up going up later.

Warren Buffett opened up his position in General Motors Company during the first quarter of 2012. He bought 10 million shares at an average price of $25 per share. The company’s P/E ratio is holding at 5.3, but this is after its P/E declined for a year and a half straight.

Conoco Phillips is a position that Buffett has been slowly whittling down since 2008. In 2008 he had over 83 million shares, but in the third quarter of 2012, he now has 29,100,937 shares. Conoco Phillips P/E ratio is currently at a three-year low of 6. This is a significant drop since it was in the high teens during 2010.

Warren Buffett also bought shares of Gannett Co. Inc. prior to the year 2007, but it is only a tiny portion of his overall portfolio at 0.035%. The company’s P/E ratio is 6.5, and this is basically in its middle range over the last few years.

Gannett earnings dropped 22.7% over the prior year in the first-quarter of 2012. It stated that the results were impacted because of advertising softness as well as strategic investing on the part of the company. Every segment of the company was profitable, and it’s digital segments and broadcasting segments rose 7% and 8% respectively. The digital revenue even grew by a large 13%, and this shows just how important it is for newspapers to push their digital platforms.

Berkshire Hathaway and Warren buffet owned 3,877,122 shares of General Dynamics Corp. at the end of the first quarter of 2012. This is actually a new holding that they opened up in the third quarter of 2011. And General Dynamics has a P/E of 8.6, which has been declining over the last few years. Their P/E ratio was in the high teens prior to the recession taking place.