Billionaire Druckenmiller’s Top Dividend Stock Picks

Stanley Druckenmiller was one of the fund managers for the Quantum Fund founded by George Soros. Ranked 128^th on Forbes’ list of the richest people with a net worth of $4.4 billion, Stanley Druckenmiller now manages funds for his family office, Duquesne Family Office LLC. The American hedge fund manager ran the $12 billion Duquesne Capital till 2010. His fund’s equity portfolio is worth $1.13 billion according to its last 13F filing, with 20% allocated to technology, finance, and healthcare sectors, respectively. Given the uncertainty around growth, interest rates and taxes, it might be a good idea to follow the smart money strategy around dividend stocks. We have thus analyzed some of the top dividend-yielding stocks from Duquesne’s 13F portfolio. We believe that these funds do not invest in stocks only for their dividend yields but also for their upside potential.

We follow over 700 hedge funds and other institutional investors and by analyzing their quarterly 13F filings, we identify stocks that they are collectively bullish on and develop investment strategies based on this data. One strategy that outperformed the market over the last year involves selecting the 100 best-performing funds and identifying the 30 mid-cap stocks that they are collectively the most bullish on. Over the past year, this strategy generated returns of 18%, topping the 8% gain registered by S&P 500 ETFs.

AbbVie Inc (NYSE:ABBV) was the second-largest position in Stanley Druckenmiller’s equity portfolio at the end of September, with the fund holding 1.32 million shares worth $83.5 million. Larry Robbins’ Glenview Capital Management also held a $380 million stake with 6.03 million shares, while Two Sigma Advisors amassed 2.58 million shares worth $162 million. The stock has returned some 10% over the last year and has a solid dividend yield of 4.15%, based on the dividend of $0.57 per share that the company has paid for the last four quarters. AbbVie Inc’s (NYSE:ABBV) third-quarter revenues of $6.40 billion missed expectations by $160 million, while its earnings of $1.21 per share, beat estimates by $0.01. The number of hedge funds from our database long AbbVie Inc (NYSE:ABBV) inched down to 56 from 57 during the third quarter and the value of their holdings also  by $60 million to $4.17 billion between July and September.

Stanley Druckenmiller bought 682,600 shares of Abbott Laboratories (NYSE:ABT) during the third quarter, increasing its holding to 1.0 million shares worth $45 million. Ken Griffins’ Citadel Advisors and Israel Englander’s Millennium Management also held shares worth $77 million and $72.9 million respectively at the end of September. The stock is attractively valued at 16 times forward earnings and yields 2.77%. The company raised its quarterly dividend by 1.90% to $0.27 per share. Abbott Laboratories (NYSE:ABT) was included in the equity portfolios of 52 funds tracked by us at the end of the third quarter, up from 47 funds at the end of June. The value of their investment also increased by 12.7% to $1.81 billion during the third quarter.

Stanley Druckenmiller initiated a new position in Merck & Co., Inc. (NYSE:MRK) during the third quarter and held 683,800 shares worth $42.6 million at the end of September. For the third quarter, Merck & Co., Inc. (NYSE:MRK) reported revenue of more than $10.54 billion, beating the consensus estimate by $360 million, while EPS of $1.07 was higher than the expected $0.98. The stock has outperformed the S&P index by returning more than 15% over the last 52 weeks. Merck & Co., Inc. (NYSE:MRK)’s stock also sports a healthy dividend yield of 3.16% and has a P/E ratio of 30x.  Merck is also the fifth most popular Dow stock among the funds in our database. There were 84 funds tracked by us long Merck & Co., Inc. (NYSE:MRK) at the end of the third quarter, up from 66 funds a quarter earlier.

Intel Corporation (NASDAQ:INTC) represented a new position in Duquesne Family Office 13F portfolio. Stanley Druckenmiller bought 547,200 shares worth $20.65 million during the third quarter. Fisher Asset Management also held 19.8 million shares of Intel Corporation (NASDAQ:INTC) valued at $748.8 million, according to its latest 13F filing. The stock has a decent yield of 2.8%, it has rallied by more than 14% over the last six months and has an average ‘Overweight’ rating from analysts. Intel’s USP is its unique technology, vertical integration, and dominant position in the server processor market. It also has one of the leading positions in the Internet of Things (IOT) industry. Among the funds we track, 68 funds owned $4.88 billion worth of Intel Corporation (NASDAQ:INTC)’s stock at the end of September, versus 57 funds and $3.41 billion, respectively, a quarter earlier.

Druckenmiller’s family office sold more than 80% of its stake in Agrium Inc. (USA) (NYSE:AGU) during the third quarter and held 38,974 shares worth $3.5 million at the end of the third quarter. Two Sigma Advisers also held 71,222 shares valued at $6.4 million . Agrium Inc. (USA) (NYSE:AGU)’s merger with Potash Corporation of Saskatchewan Inc. (USA) (NYSE:POT) has been recently approved by the Ontario Superior Court of Justice for a merger of equals. The stock has an attractive dividend yield of 3.48%, based on the dividend of $0.88 per share that the company has paid over the last few quarters.  The number of funds from our database bullish on Agrium Inc. (USA) (NYSE:AGU) inched down by one to 17 during the third quarter, while the total value of their holdings grew to $226 million from $177 million.

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