In this article, we discuss the 10 best dividend stocks according to Tiger Cub Rob Citrone.
Rob Citrone, also known as the emerging markets specialist, co-founded Discovery Capital Management in 1999. Known as a “tiger cub” for having worked for Julian Robertson’s Tiger Management, Citrone’s real-time net worth stands at $1.1 billion, according to Forbes.
Before founding Discovery Capital, Citrone worked as a corporate bond analyst at Fidelity in 1990 and joined Tiger Management in 1995. He carried his long-short equity strategies when he founded his own hedge fund. Discovery Capital Management pursues global macro strategies while emphasizing credit investments. The firm also focuses on currencies in both developed and emerging markets. As cryptocurrencies are gaining ground among macro hedge funds, Citrone also earned profit from his crypto bets. According to a recent report published by Bloomberg, Discovery Capital gained 55% in 2020 due to its bitcoin bets. In 2021, the hedge fund gained 19%, through December. Moreover, since its inception in 1999, the fund’s annual average returns stood at 17%.
In Q3 2021, Discovery Capital Management holds a 13F portfolio value of over $1.3 billion. The hedge fund invests mainly in technology, services, and finance, among other sectors. Some of the fund’s major holdings include Pfizer Inc. (NYSE:PFE), Visa Inc. (NYSE:V), and Alphabet Inc. (NASDAQ:GOOG).
Our Methodology:
In this article, we will focus on dividend stocks according to Tiger Cub Rob Citrone. For this list, we considered Discovery Capital Management’s 13F portfolio as of Q3. The stocks are listed from the lowest yield to the highest.
10 Best Dividend Stocks According to Tiger Cub Rob Citrone
10. Vontier Corporation (NYSE:VNT)
Number of Hedge Fund Holders: 31
Dividend Yield as of February 2: 0.36%
Discovery Capital Management’s Stake Value: $31,793,000
Vontier Corporation (NYSE:VNT) is an American manufacturing and industrial technology company that mainly specializes in mobility technologies. The company was the ninth-largest holding of Discovery Capital Management in Q3 and made up 2.37% of its 13F portfolio. The hedge fund held a stake worth over $31.7 million in Vontier Corporation (NYSE:VNT)in Q3.
Vontier Corporation (NYSE:VNT) initiated its quarterly dividends on May 24, 2021, and currently pays a quarterly dividend of $0.025 per share. The stock’s current dividend yield stands at 0.36%.
Appreciating the company’s transformation efforts and its earnings growth, in December, Argus lifted its price target on Vontier Corporation (NYSE:VNT) to $39, with a Buy rating on the shares.
At the end of Q3 2021, 31 hedge funds tracked by Insider Monkey held stakes in Vontier Corporation (NYSE:VNT), down from 34 in the preceding quarter. These stakes are valued at over $805.7 million. Among these hedge funds, Gates Capital Management was the company’s largest shareholder, owning shares worth over $149 million.
Pfizer Inc. (NYSE:PFE), Visa Inc. (NYSE:V), and Alphabet Inc. (NASDAQ:GOOG) are also important holdings of Rob Citrone in Q3, other than Vontier Corporation (NYSE:VNT).
Miller Value Partners mentioned Vontier Corporation (NYSE:VNT) in its Q1 2021 investor letter. Here is what the firm has to say:
“We also purchased Vontier, a spin-out from Fortive, which itself was a spinout from Danaher. Danaher’s unique approach to managing its business and acquiring companies created massive value over the years. Fortive pursued the same path. Vontier uses the same business and acquisition systems and offers similar potential. Vontier’s main businesses are gas station software and hardware and auto repair tooling. The market doesn’t value it similarly to the other two companies due to near-term business headwinds from passing a regulatory-led demand surge for its equipment and concerns about electric vehicle disruption. Management has already made some smart investments in the space and we believe it will deploy the same rational capital allocation policy that drove so much value at its predecessors.”
9. Visa Inc. (NYSE:V)
Number of Hedge Fund Holders: 143
Dividend Yield as of February 2: 0.65%
Discovery Capital Management’s Stake Value: $7,841,000
Visa Inc. (NYSE:V), an American multinational financial services company, increased its dividend by 17% in 2021 to $0.375 per share. The stock’s dividend yield stands at 0.65%. Moreover, the company maintains a 14-year track record of consistent dividend growth, making it one of the best dividend stocks in Rob Citrone’s portfolio.
The number of hedge funds tracked by Insider Monkey having stakes in Visa Inc. (NYSE:V) declined to 143 in Q3, from 162 in the previous quarter. These stakes are valued at over $26.1 billion.
Visa Inc. (NYSE:V) was one of the latest acquisitions of Discovery Capital Management in Q3, making up 0.58% of its 13F portfolio. The hedge fund started its position in the company with a stake worth over $7.8 million. According to analysts, Visa Inc. (NYSE:V) is considered a safe dividend stock as the company paid $2.8 billion in dividends to shareholders in FY21. Appreciating the company’s fiscal Q1 2022 earnings beat, in January, Barclays lifted its price target on Visa Inc. (NYSE:V) to $265, while maintaining an Overweight rating on the shares.
Wedgewood Partners mentioned Visa Inc. (NYSE:V) in its Q4 2021 investor letter. Here is what the firm has to say:
“Visa contributed to performance but less so compared to most holdings. Credit card payment volumes over Visa Inc. (NYSE:V)’s networks continued to recover from COVID effects, growing over +18% on a U.S. dollar basis, supplemented by continued strength in debit. High-margin, travel-related cross-border credit card volumes continue to remain below 2019 levels, and although it is difficult to know when cross-border payment activity will recover to 2019 levels, we think it is just a matter of “when” not “if.” The return of international travel should represent additional upside to Visa’s growth rates over the next few years. As for Visa Inc. (NYSE:V)’s stock, we note again that the index providers, S&P Dow Jones and MSCI, announced the potential re-constitution of their equity indexes, including changing the sector classification of payment processors, such as Visa (and PayPal), from “Information Technology” over to “Financials.” Although we are benchmark agnostic, we suspect that the potential change to this market structure, particularly within passive index exchanged-traded funds, likely added to volatility during the quarter. Visa traded down to attractive relative and historical forward earnings multiples, so we added to our position. Visa maintains a dominant franchise that is providing the network – or “rails” – that have led to a boom in fintech payment volumes, so we were happy for the opportunity to increase our weightings.”
8. Microchip Technology Incorporated (NASDAQ:MCHP)
Number of Hedge Fund Holders: 41
Dividend Yield as of February 2: 1.19%
Discovery Capital Management’s Stake Value: $18,705,000
An American semiconductor supplier, Microchip Technology Incorporated (NASDAQ:MCHP) was recently lauded at UBS, as the firm acknowledged the company’s position in the analog industry. The firm lifted its price target on the stock to $92, implying a 28% upside from current levels, while keeping a Buy rating on the shares.
According to analysts, Microchip Technology Incorporated (NASDAQ:MCHP) is well-positioned to grow its dividend in the coming years considering growing analog businesses and its strong cash generation. In 2021, the company increased its dividend by 6% to $0.232 per share, with a dividend yield of 1.19%. Discovery Capital Management started its position in Microchip Technology Incorporated (NASDAQ:MCHP) during the second quarter of 2020, with a $6.4 million worth of stake. In Q3 2021, the company represented 1.39% of the hedge fund’s 13F portfolio.
As per Insider Monkey’s Q3 data, 41 hedge funds held stakes in Microchip Technology Incorporated (NASDAQ:MCHP), down from 50 in the preceding quarter. These stakes hold a consolidated value of over $1.1 billion. Platinum Asset Management held the largest stake in the company in Q3, worth $301.7 million.
7. América Móvil, S.A.B. de C.V. (NYSE:AMX)
Number of Hedge Fund Holders: 11
Dividend Yield as of February 2: 2.09%
Discovery Capital Management’s Stake Value: $74,295,000
Though América Móvil, S.A.B. de C.V. (NYSE:AMX), a Mexican telecommunications company, suffered a slight decline in the number of hedge funds holding positions in it, Wall Street analysts remained positive on the company’s growth. Recently, Barclays lifted its price target on the stock to $21, with an Overweight rating on the shares.
América Móvil, S.A.B. de C.V. (NYSE:AMX) has been increasing its dividend consistently for the last decade, which makes it one of the best dividend stocks in Rob Citrone’s portfolio. Currently, the company pays a quarterly dividend of $0.197 per share, with a 2.09% dividend yield. In Q3 2021, Discovery Capital Management increased its stake in América Móvil, S.A.B. de C.V. (NYSE:AMX) by 107% and held a stake worth over $74.2 million. The company made up 5.55% of the hedge fund’s 13F portfolio.
As mentioned before, the number of hedge funds tracked by Insider Monkey holding stakes in América Móvil, S.A.B. de C.V. (NYSE:AMX) declined in Q3, as 11 hedge funds held stakes in the company, compared with 13 in the previous quarter. These stakes are worth over $167.7 million, up from $114.4 million in Q2.
6. State Street Corporation (NYSE:STT)
Number of Hedge Fund Holders: 42
Dividend Yield as of February 2: 2.36%
Discovery Capital Management’s Stake Value: $8,472,000
State Street Corporation (NYSE:STT), an American bank holding and financial services company, experienced a positive hedge fund sentiment in Q3. 42 hedge funds in Insider Monkey’s database held stakes in the company in Q3, holding a consolidated value of roughly $1.5 billion. In comparison, 37 hedge funds held positions in the company, with stakes valued at over $1.1 billion.
In 2021, State Street Corporation (NYSE:STT) increased its dividend by 10% to $0.57 per share. The stock’s annual yield stands at 2.36%. In the past year, the stock has delivered a 35.6% return to shareholders, as of February 2’s close. State Street Corporation (NYSE:STT) was one of the latest holdings of Discovery Capital Management in Q3, constituting 0.63% of its 13F portfolio. The hedge fund held shares worth over $8.4 million in the company. Along with State Street Corporation (NYSE:STT), Pfizer Inc. (NYSE:PFE), Visa Inc. (NYSE:V), and Alphabet Inc. (NASDAQ:GOOG) hold considerable positions in Rob Citrone’s third-quarter portfolio.
In January, Barclays highlighted the positive trends in the banking sector in 2022 and lifted its price target on State Street Corporation (NYSE:STT) to $130. The firm maintained an Overweight rating on the shares.
5. Intercorp Financial Services Inc. (NYSE:IFS)
Number of Hedge Fund Holders: 5
Dividend Yield as of February 2: 2.50%
Discovery Capital Management’s Stake Value: $2,296,000
Intercorp Financial Services Inc. (NYSE:IFS) is a financial services company based in Peru.
Intercorp Financial Services Inc. (NYSE:IFS) currently pays a quarterly dividend of $0.65 per share. The stock’s annual dividend yield stands at 2.50%. Discovery Capital Management started building its position in Intercorp Financial Services Inc. (NYSE:IFS) during the third quarter of 2019, with a stake worth $1.5 million. In Q3 2021, the hedge fund held shares worth roughly $2.3 million in the company, which represented 0.17% of its 13F portfolio.
NWI Management held a stake worth $22.6 million in Intercorp Financial Services Inc. (NYSE:IFS), becoming its largest shareholder in Q3. Overall, 5 hedge funds tracked by Insider Monkey reported owning stakes in the company in Q3, up from 4 in the previous quarter. These stakes are valued at roughly $30 million.
4. Intel Corporation (NASDAQ:INTC)
Number of Hedge Fund Holders: 66
Dividend Yield as of February 2: 2.98%
Discovery Capital Management’s Stake Value: $2,936,000
Intel Corporation (NASDAQ:INTC) announced a 5% increase in its dividend on January 26, to $0.365 per share. This increase marked the company’s 8th consecutive dividend growth, while its 5-year average dividend growth rate stands at 6%. According to analysts, Intel Corporation’s (NASDAQ:INTC) strong balance sheet and stable cash flow would result in further dividend growth in the coming years.
In Q3 2021, Discovery Capital Management held a stake worth roughly $3 million in Intel Corporation (NASDAQ:INTC), which represented 0.21% of its 13F portfolio. In January, Northland set a $62 price target on Intel Corporation (NASDAQ:INTC), while maintaining an Outperform rating on the shares, acknowledging the company’s Q4 earnings beat.
With stakes worth over $6.4 billion, 66 hedge funds tracked by Insider Monkey held positions in Intel Corporation (NASDAQ:INTC) in Q3. In comparison, 78 hedge funds held stakes in the company in Q2, worth $6.7 billion. Ken Fisher’s Fisher Asset Management was the company’s largest shareholder in Q3, owning shares worth over $1.7 billion.
O’Keefe Stevens Advisory Inc. mentioned Intel Corporation (NASDAQ:INTC) in its recently-published Q4 2021 investor letter. Here is what the firm has to say:
“Intel Corp (INTC) – We originally purchased Intel in August 2020 due to the substantial FCF generated and $10B+ yearly in R&D and Capex invested over the past several years. The technology lead it once had was gone as competitors such as TSMC, AMD, and others in the CPU and Data Center group surpassed Intel. Even though Intel had years of business underperformance because of delays in releasing new products, we believed the amount of capital spent at the company would allow them to catch up and reclaim market share. We knew this type of turnaround, given the company’s size, was not going to be quick or easy. However, we believed the price offered more than compensated us for the risk of failing once again.
In January, Intel announced Pat Gelsinger as the new CEO. We were happy with the hire as Pat was Intels original CTO, helping Intel become the dominant player in the industry it once was. We became increasingly worried that Pat was not the right guy in the months and quarters following the announcement. Mr. Gelsinger appears to be viewing the world through rosecolored glasses (though we do recognize the CEO is the heart and soul of the organization, so we understand to a certain extent why he talked the way he did). Intel’s FCF gave us some comfort that it could afford to continue investing in new products while repurchasing shares or making acquisitions.
In the most recent quarter, the company announced an ambitious spending plan. In 2022, Intel expects to spend between $25-$28B in capital expenditures plus another $15B in R&D, with the potential to spend more if an opportunity presents itself! The FCF cushion we once had is likely gone for the next few years as Intel bets the farm to return to a market-leading position. While the future for Semiconductors is very bright, and end markets such as Data Centers and Autonomous vehicles are growing rapidly, we worry about the potential ramifications should INTC’s investments prove to be ill-fated like the past decade. Understanding what INTC will earn next year is a challenge in and of itself. Thinking about what it could be in 3-5 years is likely nothing more than a guess. With our downside protection gone and uncertainty surrounding the business’s future, we decided to sell the position. We are long-term-minded and are willing to ride out short-term pain. However, when the facts change, we must update our prior views.”
3. Pfizer Inc. (NYSE:PFE)
Number of Hedge Fund Holders: 74
Dividend Yield as of February 2: 3.01%
Discovery Capital Management’s Stake Value: $25,638,000
Pfizer Inc. (NYSE:PFE), an American pharmaceutical and biotech company, announced a quarterly dividend of $0.40 per share on December 10, 2021. This represented a 2.6% increase in its dividend, as the company has been increasing its dividend consistently for the past 11 years. Moreover, Pfizer Inc. (NYSE:PFE) has been paying dividends to shareholders consecutively for 333 quarters, becoming one of the best dividend stocks in Rob Citrone’s portfolio.
Insider Monkey’s Q3 data showed that the number of hedge funds having stakes in Pfizer Inc. (NYSE:PFE) grew to 74, from 67 in the previous quarter. These stakes are valued at over $2.66 billion.
In Q3 2021, Discovery Capital Management increased its position in Pfizer Inc. (NYSE:PFE) by 80%, which constituted 1.91% of its 13F portfolio. The hedge fund held shares worth over $25.6 million in the company. On January 28, JPMorgan appreciated the company’s vaccine sales and further believes earnings to exceed expectations in 2022. The firm lifted its price target on Pfizer Inc. (NYSE:PFE) to $57, with a Neutral rating on the shares.
Saturna Capital mentioned Pfizer Inc. (NYSE:PFE) in its Q3 2021 investor letter. Here is what the firm has to say:
“The Fund’s strongest performer during the quarter was pharmaceutical manufacturer Pfizer. The company submitted trial data to the FDA for use of its COVID-19 vaccine for younger children, and it is widely expected that the FDA will approve it. Health authorities also began recommending booster shots of the Pfizer vaccine for select populations, further increasing demand for vaccinations.”
2. JOYY Inc. (NASDAQ:YY)
Number of Hedge Fund Holders: 21
Dividend Yield as of February 2: 4.20%
Discovery Capital Management’s Stake Value: $18,851,000
JOYY Inc. (NASDAQ:YY) is a video-based social media platform that engages users on personal computers and mobile devices. The company is based in Singapore. In Q3 2021, Discovery Capital Management increased its stake in JOYY Inc. (NASDAQ:YY) significantly by 1,031%, which represented 1.41% of Rob Citrone’s portfolio.
JOYY Inc. (NASDAQ:YY) currently pays a quarterly dividend of $0.51 per share, with a dividend yield of 4.20%. In December, Morgan Stanley presented a positive stance on the company, calling it a Research Tactical Idea due to its user growth. The firm maintained an Overweight rating on JOYY Inc. (NASDAQ:YY)’s shares. Since the beginning of 2022, the stock has delivered a 5.7% return to shareholders, as of the market close of February 2.
As of Q3 2021, 21 hedge funds tracked by Insider Monkey reported owning stakes in JOYY Inc. (NASDAQ:YY), down from 24 in the previous quarter. These stakes hold a consolidated value of over $250 million.
Tao Value mentioned JOYY Inc. (NASDAQ:YY) in its Q1 2021 investor letter. Here is what the firm has to say:
“We exited YY after 3.5 years near all-time high. The annualized return (13~%) yet is below expectation, especially compared to founder CEO David Xueling Li’s net worth (mainly in YY shares) ballooning from $1.1B in 2018 to $2.3B in 2021. On value realization, I think YY did a good job, acquiring Bigo, spinning off then selling Huya & selling YY Live to Baidu. But as a minority shareholder, we were treated unfairly. E.g. the Bigo deal (for buying shares from executives including Li) was done by YY stock when the price was severely depressed, causing significant dilution for our ownership. We learned our lessons and will evaluate more rigorously in management’s partnership mindset in the future.”
1. EPR Properties (NYSE:EPR)
Number of Hedge Fund Holders: 19
Dividend Yield as of February 2: 6.75%
Discovery Capital Management’s Stake Value: $19,629,000
EPR Properties (NYSE:EPR), an American real estate investment trust, pays monthly dividends to its shareholders. The company suspended its dividend payouts in 2020 in the face of the pandemic, however, it currently pays a monthly dividend of $0.25 per share. The stock’s dividend yield stands at 6.75%. According to analysts, EPR Properties (NYSE:EPR) boasts a solid financial position due to its growing restaurant sales since 2020.
Discovery Capital Management started investing in EPR Properties (NYSE:EPR) during the first quarter of 2021, with shares worth $13 million. The hedge fund increased its stake in the company by 6% in Q3 2021, which represented 1.46% of its 13F portfolio. This December, Citigroup lifted its price target on EPR Properties (NYSE:EPR) to $58, while maintaining a Neutral rating on the shares.
According to Insider Monkey’s data for Q3, 19 hedge funds held stakes in EPR Properties (NYSE:EPR), worth over $220 million. In comparison, 20 hedge funds held positions in the company in the preceding quarter, with stakes valued at over $231 million.
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Disclosure. None. 10 Best Dividend Stocks According to Tiger Cub Rob Citrone is originally published on Insider Monkey.
