10 Best Blue Chip Dividend Stocks in 2017

With half of 2017 already gone, it is high time to watch out for the 10 Best Blue Chip Dividend Stocks in 2017.

A blue chip company is generally considered to be one that has survived the market’s ups and downs, and become a large, well-known company having a long history of sound financial performance. The term ‘Blue Chip’ was coined by Oliver Gingold in 1923.

Blue Chip companies have solid business models that can endure tough conditions. Their stock prices are very high because Mr. Market values these companies based on their brand and good reputation. However, owning blue chip stocks in one’s portfolio does not guarantee total immunity from volatility, as was the case with large companies like General Motors Company (NYSE:GM) and Lehman Brothers during the Financial Crisis.

However, blue chip stocks generally give high returns over the long term and should add some degree of safety to one’s portfolio. It is not obligatory for blue chip stocks to give dividends. For example, technology giants like Alphabet Inc. (NASDAQ:GOOG) and Facebook Inc. (NASDAQ:FB) do not pay dividends. However, most blue chips have long records of paying dividends. The 10 Best Blue Chip Dividend Stocks in 2017 provide the potential for both capital growth and a steady income stream in the form of dividend payments.

We have collated a list of the 10 best blue chip dividend stocks in 2017, having a yield greater than 7%, and ranked them based on hedge fund sentiment. At Insider Monkey, we track insider trading and hedge fund activity to uncover actionable patterns and profit from them. We track over 700 of the most successful hedge funds ever in our database and identify only their best stock picks. Our flagship strategy has gained 44% since February 2016 and our stock picks released in the middle of February 2017 beat the market by over 5 percentage points in the three months that followed. Our latest stock picks were released in mid-May, which investors can gain access to by becoming a subscriber to Insider Monkey’s premium newsletters.

Head to the next page to begin the list.

10. Consolidated Communications Holdings (NASDAQ:CNSL)

– Number of Hedge Funds With Long Positions (as of March 31): 4
– Aggregate Value of Hedge Funds’ Holdings (as of March 31): $3.3 million

Dividend Yield – 8.02%

Consolidated Communications Holdings (NASDAQ:CNSL) is a leading broadband and business communications company. With the recent acquisition of FairPoint, Consolidated Communications Holdings has expanded its advanced fiber optic network to more than 36,000 fiber route miles. The company serves businesses of all sizes and wireless companies and carriers in 24 states. Consolidated Communications offers a wide range of communications solutions, including data, voice, video, managed services, cloud computing, and wireless backhaul. Consolidated Communications has a healthy dividend yield of over 8% at $1.55 per share annually. The company has been paying dividends for 48 quarters in a row.

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9. Sunoco, LP (NYSE:SUN)

– Number of Hedge Funds With Long Positions (as of March 31): 7
– Aggregate Value of Hedge Funds’ Holdings (as of March 31): $9.7 million

Dividend Yield – 10.88%

Sunoco, LP (NYSE:SUN) is a retail seller and wholesale distributor of motor fuels to stores, dealers, customers and distributors. Sunoco is part of the Energy Transfer Partners, L.P. family of companies. The company owns 4,900 retail outlets in 26 states and more than 650 APlus-branded convenience stores operated either by the company or by third-party dealers. With more than 125 years of experience, the Sunoco brand is synonymous with quality and excellence. The company has been increasing its dividends since 2012, with them having registered a CAGR of 22% over the last three years.

8. Buckeye Partners L.P. (NYSE:BPL)

– Number of Hedge Funds With Long Positions (as of March 31): 9
– Aggregate Value of Hedge Funds’ Holdings (as of March 31): $38.4 million

Dividend Yield – 7.85%

Buckeye Partners L.P. (NYSE:BPL) is a master limited partnership (MLP) engaged in providing midstream logistic solutions for liquid petroleum products. It is one of the largest independent liquid petroleum products pipeline operators in the U.S in terms of volumes delivered. Buckeye Partners L.P. (NYSE:BPL) is also one of the largest U.S independent operators in terms of capacity of terminalling and storage. The company owns and operates a diversified network of integrated assets consisting of the transportation, storage and marketing of liquid petroleum products. Buckeye Partners has been paying dividends since its formation in 1986.

7. AGNC Investment Corp (NASDAQ:AGNC)

– Number of Hedge Funds With Long Positions (as of March 31): 13
– Aggregate Value of Hedge Funds’ Holdings (as of March 31): $50.2 million

Dividend Yield – 10.04%

AGNC Investment Corp (NASDAQ:AGNC) or American Capital Agency Corp., as it was formerly called, is an internally managed real estate investment trust (REIT). It primarily invests in agency mortgage-backed securities on a leveraged basis. AGNC’s principal objective is to generate attractive risk-adjusted returns for its stockholders. AGNC Investment Corp (NASDAQ:AGNC) has a strong financial position with significant access to funding. The REIT pays monthly dividends, which currently have an attractive yield of 10%.

6. Vector Group Ltd (NYSE:VGR)

– Number of Hedge Funds With Long Positions (as of March 31): 13
– Aggregate Value of Hedge Funds’ Holdings (as of March 31): $197.9 million

Dividend Yield – 7.68%

Vector Group Ltd (NYSE:VGR) is a leading manufacturer and seller of cigarettes through its Liggett and Vector Tobacco subsidiaries. The company also has dealings in real estate through its New Valley subsidiary. Vector Group Ltd (NYSE:VGR) sells cigarettes under popular brand names like Eve, Grand Prix, Pyramid, Liggett Select, and Eagle 20’s. Vector’s real estate business owns over 20 properties, consisting of land, apartments, hotels, condominiums, and marginal stakes in commercial properties. The company is a free cash flow generator with diversified businesses which enables it to grow its dividends. Vector Group has an impressive dividend yield of 7.7% and has grown its payouts at a 5% CAGR over the last decade.

5. Barnes & Noble, Inc. (NYSE:BKS)

– Number of Hedge Funds With Long Positions (as of March 31): 21
– Aggregate Value of Hedge Funds’ Holdings (as of March 31): $127.8 million

Dividend Yield – 8.22%

With a dividend yield of 8.22%, Barnes & Noble, Inc. (NYSE:BKS) ranks fifth on our list of the 10 Best Blue Chip Dividend Stocks in 2017. It is the largest retailer of books in the U.S as well as a leading retailer of content, digital media and educational products and owns BN.com, a premier e-commerce site. Starting from just one bookstore in 1965, the company has grown its network to 633 bookstores operating in 50 states. Barnes & Noble returned $67 million to its shareholders through dividends and share repurchases during its 2017 fiscal year.

4. Abercrombie & Fitch Co. (NYSE:ANF)

– Number of Hedge Funds With Long Positions (as of March 31): 24
– Aggregate Value of Hedge Funds’ Holdings (as of March 31): $112.2 million

Dividend Yield – 8.66%

Abercrombie & Fitch Co. (NYSE: ANF) is a leading global apparel and accessories specialty retailer. With more than 125 years of experience, the company has gained expertise in creating American-style products embodying enduring quality and exceptional comfort. The company offers a wide range of apparel, personal care products and accessories for men, women and kids. The company operates more than 900 stores in the U.S and internationally. It sells merchandise under the Abercrombie & Fitch, Hollister and Abercrombie kids brands. The company’s current dividend yield stands at 8.66%.

3. Royal Dutch Shell Plc (ADR) (NYSE:RDS.A)

– Number of Hedge Funds With Long Positions (as of March 31): 29
– Aggregate Value of Hedge Funds’ Holdings (as of March 31): $1.06 billion

Dividend Yield – 6.96%

Royal Dutch Shell Plc ADR (NYSE:RDS.A) is an independent global oil and gas company having a presence in more than 70 countries. The company engages in the exploration of crude oil and natural gas, both in conventional fields and from other sources. Royal Dutch Shell Plc ADR (NYSE:RDS.A) operates in three segments: upstream, downstream and corporate. With more than 100 years of experience, the Shell brand is well-known for its values and the quality of its products and services worldwide. The company has been paying ever-increasing dividends for the last decade and its stock has a current yield of 6.9%.

2. BP Plc (ADR) (NYSE:BP)

– Number of Hedge Funds With Long Positions (as of March 31): 30
– Aggregate Value of Hedge Funds’ Holdings (as of March 31): $528.9 million

Dividend Yield – 6.85%

BP Plc (NYSE:BP) is one of the world’s leading integrated oil and gas companies. The company engages in finding and producing oil and gas on land and offshore, in more than 70 countries worldwide. BP Plc (NYSE:BP) has a strong presence both in the upstream and downstream businesses. It also owns an interest in Rosneft, an oil company in Russia. The company owns a diversified and balanced portfolio across businesses, resource types, and geographies. BP is also growing its renewables activities, owning biofuel and wind energy generating assets. Despite the recent slowdown in the energy industry, BP has been able to raise its dividend by more than 7% compounded annually over the last five years.

1. Macy’s Inc. (NYSE:M)

Dividend Yield – 7.13%

– Number of Hedge Funds With Long Positions (as of March 31): 43
– Aggregate Value of Hedge Funds’ Holdings (as of March 31): $594.5 million

Macy’s Inc. (NYSE:M) tops our list of the 10 Best Blue Chip Dividend Stocks in 2017 with the highest number of hedge funds having long positions in it at the end of March 2017. It is one of the leading premier retailers of accessories and apparel. The company operates more than 700 department stores and 125 specialty stores under the nameplates Macy’s and Bloomingdale’s.

Macy’s is facing immense pressure from rising e-commerce businesses and is closing down its unprofitable stores. Macy’s Inc. (NYSE:M) is trying to boost its online business as well as lure shoppers to its physical stores with prime locations as well as attractive merchandise. Macy’s is now one of the nation’s premier omnichannel retailers, having an extensive presence physically as well as online. The company has been increasing its dividend payouts since 2009 and has grown them at a CAGR of 33% over the last five years.

Disclosure: None