In this article, we discuss the 10 best dividend stocks hedge funds are buying.
According to a Business Insider report dated October 30, hedge funds are on track for their strongest annual results following Covid-19, despite the year being politically and economically volatile. In the first three quarters of 2025, the average gains for hedge funds clocked in at 16.6%, while they reported net inflows of over $40 billion, as cited by Citco, a fund administrator.
The hedge fund industry is gearing up for its strongest year since 2020, with the average gains in Q3 2025 coming in at 5.2% within every core strategy. In addition, 80% of funds reported an upswing in returns, according to Citco data.
Multistrategy funds have a diverse investment methodology, and they gained about 19.3% in 2025 on average, with equity funds clocking in at 17.1% in terms of average gains and global macro funds standing at 15.8%. Citadel and Millennium, hedge funds that manage assets worth $69 billion and $79 billion, respectively, were up 5% and 6% through September.
On November 10, Reuters cited a Goldman Sachs report, stating that hedge funds, including equity traders, have posted gains exceeding 13% this year as of October end. Hedge fund stock pickers in October realized 1.75% in gains, falling short of the 2.3% increase in the S&P 500 index. According to Goldman Sachs, crowded trades, pouring money into healthcare and tech stocks, and market volatility contributed to positive returns. Hedge funds remained invested in global stocks for the second consecutive month as of October, as they perceive a favorable outlook in the long run. However, systematic funds and quant funds did not fare particularly well in October, potentially due to their exposure to short bets. Macro funds, on the other hand, performed better than in September.
With that outlook in mind, let’s take a look at the best dividend stocks hedge funds are buying.
Photo by Dan Dennis on Unsplash
Our Methodology
For this list, we manually browsed Insider Monkey’s Q3 database of 978 hedge funds for dividend stocks favored by the highest number of hedge fund holders and boasting a minimum of 10 years of dividend history. We included hedge fund sentiment data for each stock as of Q3 2025, ranking them in ascending order based on the number of hedge fund holders. For further insight, we used company websites to count the number of years of consistent dividend payouts for each company.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
10. Bank of America Corporation (NYSE:BAC)
Number of Hedge Fund Holders: 111
Number of Years of Dividend Payouts: 20
Bank of America Corporation (NYSE:BAC) is one of the best dividend stocks to buy according to hedge funds. On November 19, Chris Kotowski, an Oppenheimer analyst, reiterated a Buy recommendation on BAC. The price target was set at $55.
In a November 5 report by Fortune, it was revealed that Bank of America’s yearly expenditure has risen by 44% over the course of the last ten years, reaching $4 billion in 2025. The increase in spending stemmed from new tech initiatives, notably the adoption of artificial intelligence within the bank.
Hari Gopalkrishnan, BAC’s chief technology and information officer, mentioned to Fortune:
“We have steadily increased our spend in technology, now up to $13 billion a year, of which $4 billion goes into strategic growth. We leverage across the enterprise, so every dollar you spend gets the maximum bang for the buck, as opposed to sort of being siloed by line of business.”
Gopalkrishnan mentioned that the latest AI products and applications will be scaled and implemented across each of the eight business segments at Bank of America.
Bank of America Corporation (NYSE:BAC) is one of the most popular dividend stocks among hedge funds, with the company boasting 20 years of dividend payouts.
9. Eli Lilly and Company (NYSE:LLY)
Number of Hedge Fund Holders: 114
Number of Years of Dividend Payouts: 53
Eli Lilly and Company (NYSE:LLY) is one of the best dividend stocks to buy according to hedge funds. On November 23, Morgan Stanley analyst Terence Flynn maintained a Buy call on Eli Lilly, along with a price target of $1,290.
In a different corporate update, dated November 24, Eli Lilly reported that it will present the latest data from its breast cancer pipeline at the San Antonio Breast Cancer Symposium (SABCS). This symposium will take place from December 9 to 12. These findings reflect Lilly’s ongoing progress across core mechanisms in HR+, HER2– breast cancer, which is the most prevalent breast cancer subtype.
Jacob Van Naarden, Executive Vice President and President of Lilly Oncology, commented:
“At SABCS 2025, we’re proud to showcase new data across our portfolio of investigational and approved breast cancer medicines, addressing the three most important biologic targets in HR+ breast cancer: CDK4/6, the estrogen receptor, and PI3K. Together, these presentations reflect the continued momentum of Lilly’s breast oncology portfolio and our commitment to translating biologic conviction into meaningful progress for people living with breast cancer.”
Eli Lilly and Company (NYSE:LLY) is an Indianapolis-based company that develops, manufactures, and markets pharmaceuticals for diabetes, oncology, autoimmune and inflammatory diseases, mental health, and pain management globally.
8. JPMorgan Chase & Co. (NYSE:JPM)
Number of Hedge Fund Holders: 120
Number of Years of Dividend Payouts: 25 (after merger on December 31, 2000)
JPMorgan Chase & Co. (NYSE:JPM) is one of the best dividend stocks to buy according to hedge funds. On November 24, Morgan Stanley analyst Betsy Graseck reaffirmed a Hold recommendation on JPM and maintained a target price of $338.
Separately, a BBC report from November 27 indicates that JPMorgan has outlined its plan to construct a new Canary Wharf tower, which is said to strengthen the British economy by £10 billion. The banking giant mentioned that the new building will stand at around 3 million square feet, which is double in size compared to the Shard, which is presently the tallest tower in the UK. The Canary Wharf building will house 12,000 employees and be the stronghold for JPMorgan’s EMEA markets.
According to the bank, the building needs a few approvals, and then the six-year construction process will commence. The choice to remain in Canary Wharf is a huge victory for the financial district, which struggled with retaining building occupants after Covid-19 but is seeing a rebound as office return policies increase. Jamie Dimon, the JPM CEO, mentioned that the UK government prioritizes economic development and growth, which was a significant factor in selecting this location.
7. Thermo Fisher Scientific Inc. (NYSE:TMO)
Number of Hedge Fund Holders: 121
Number of Years of Dividend Payouts: 13
Thermo Fisher Scientific Inc. (NYSE:TMO) is one of the best dividend stocks to buy according to hedge funds. On November 25, Thermo Fisher reported that it had made an offering of euro-dominated notes in the principal amount of €2.1 billion. The notes are planned to be issued via Thermo Fisher Scientific (Finance I) B.V., the company’s indirect finance subsidiary.
The company is planning to issue €1 billion worth of floating-rate senior notes due in 2027 at their full principal amount. It will also issue €1.1 billion of 3.628% fixed-rate senior notes due in 2035, again at full principal value. The offering is set to conclude on or near December 1, 2025, after all conditions are fulfilled. The notes will be entirely guaranteed by Thermo Fisher. While the floating rate notes deliver quarterly interest payments, the fixed rate notes will offer yearly interest payouts.
Thermo Fisher aims to utilize the net proceeds from the offering for corporate expenditure, such as acquisitions, debt repayment, working capital, capital expenditures, or share repurchases, or invest them in short-term, high liquidity assets.
Separately, on November 3, Daniel Arias from Stifel Nicolaus kept a Buy recommendation on Thermo Fisher, with an accompanying price target of $583.
Thermo Fisher Scientific Inc. (NYSE:TMO) is a Massachusetts-based company that manufactures and distributes life sciences products, lab equipment, and biopharma services worldwide.
6. Oracle Corporation (NYSE:ORCL)
Number of Hedge Fund Holders: 122
Number of Years of Dividend Payouts: 16
Oracle Corporation (NYSE:ORCL) is one of the best dividend stocks to buy according to hedge funds. On November 18, Baird maintained an Outperform rating on ORCL but slashed the target price from $365 to $315. The firm altered its bullish sentiment after observing Oracle’s debt and AI capacity.
Separately, a Financial Times report from November 28 states that Oracle, along with SoftBank and CoreWeave, has already amassed $30 billion in debt to invest in OpenAI’s data centres. Similarly, some banks are in conversation to loan an additional $38 billion to Oracle Corporation (NYSE:ORCL) and Vantage so they can construct further data centers for the AI startup. This deal is supposed to be completed in the next few weeks.
Another piece from the Financial Times, dated November 18, discussed Oracle Corporation (NYSE:ORCL)’s capacity to handle more debt. Oracle disclosed a $300 billion collaboration with OpenAI on September 10, and consequently, the stock has massively shed its market cap. The market theorizes that OpenAI aims to discover artificial general intelligence (AGI), and Oracle is in a position to provide it the computing power it requires at lower prices than competitors. Another way to see it is that Oracle, with less profit to spare than competitors, is dedicating maximum resources to its client in exchange for a repayment promise.
Oracle Corporation (NYSE:ORCL) is a Texas-based provider of software, cloud services, hardware, and IT solutions to companies, governments, and schools globally.
5. Capital One Financial Corporation (NYSE:COF)
Number of Hedge Fund Holders: 129
Number of Years of Dividend Payouts: 30
Capital One Financial Corporation (NYSE:COF) is one of the best dividend stocks to buy according to hedge funds. On November 21, Vincent Caintic, an analyst from BTIG, assigned a Buy rating on COF with a price target of $264.
In a separate Reuters report, dated November 7, it was disclosed that a federal judge dismissed a $425 million settlement offer with depositors, who claimed that they were denied the interest rates they expected. The depositors noted that the payment offer was very minimal, and millions of them would still be short-changed.
The settlement aimed to address claims that Capital One capped interest at 0.3% on high-interest 360 Savings accounts while giving out higher rates of 4% and above on similarly branded 360 Performance Savings accounts to new clients. The bank offered to shell out $300 million in unsettled interest to 360 Savings customers, and an additional $125 million of interest if they kept their accounts with the bank. However, District Judge David Novak from Alexandria, Virginia, ruled on November 6 that the extent of the depositors’ claims would need “significantly greater relief.”
18 states are suing Capital One over this issue, and they also rejected the settlement. The judge told both parties to start negotiations once more to reach an equitable solution.
Capital One Financial Corporation (NYSE:COF) is a Virginia-based financial services company specializing in banking, lending, and credit products in the United States, Canada, and the United Kingdom.
4. Mastercard Incorporated (NYSE:MA)
Number of Hedge Fund Holders: 136
Number of Years of Dividend Payouts: 19
Mastercard Incorporated (NYSE:MA) is one of the best dividend stocks to buy according to hedge funds. On November 19, the payment giant announced that it is initiating Agent Pay in the UAE, and this marked its very first transaction internationally. In its UAE pilot phase, Mastercard is partnering with Majid Al Futtaim, a major player in shopping arenas, retail, and entertainment in the Middle East, Africa, and Asia. Another partner for this initiative is Dataiera, a fintech company.
After launch, users will be able to access an AI agent to browse, discover, and make payments via Agent Pay. The UAE’s Minister of State for Artificial Intelligence, Digital Economy, and Remote Work Applications, His Excellency Omar Sultan Al Olama, mentioned that the UAE is open and widely receptive to advanced technologies in a bid to boost competitiveness on the global stage. He sees Agent Pay as a primary milestone, which opens up new avenues for the UAE’s digital economy and infrastructure.
Mastercard Incorporated (NYSE:MA) has previously collaborated with the UAE in 2023, when it opened Mastercard’s Center for Advanced AI and Cyber Technology in Dubai in order to promote financial innovation in the Emirates.
In another update, dated November 17, Mastercard partnered with Zenith Bank to initiate the Essential Debit Card, which was developed to increase safe digital payments in Nigeria. The card was created to meet the daily transaction activities of economically or socially disadvantaged populations, including users on a lower income tier, who have faced challenges with conventional banking systems. This collaboration comes as Nigeria’s digital economy is on the rise.
3. UnitedHealth Group Incorporated (NYSE:UNH)
Number of Hedge Fund Holders: 140
Number of Years of Dividend Payouts: 35
UnitedHealth Group Incorporated (NYSE:UNH) is one of the best dividend stocks to buy according to hedge funds. On November 12, Wells Fargo analyst Stephen Baxter assigned a Buy rating on UnitedHealth, while setting the price target at $400.
A separate November 25 report suggests that UnitedHealthcare and TriHealth discussions are still ongoing, as a compensation conflict could likely push TriHealth providers out of UNH’s network by year-end, possibly impacting up to 80,000 patients in the Tri-State locality.
In a statement, UNH mentioned that TriHealth is seeking a 35% higher reimbursement, which makes it the highest-priced health provider in Cincinnati. United offered rate increases so that they remain competitive within the market. However, TriHealth claimed that they must be paid for the quality of care, especially towards special needs patients, that they provide.
UnitedHealth Group Incorporated (NYSE:UNH) is a Minnesota-based healthcare organization that provides health benefit plans and services to individuals, employers, and the public sector.
2. Visa Inc. (NYSE:V)
Number of Hedge Fund Holders: 179
Number of Years of Dividend Payouts: 17
Visa Inc. (NYSE:V) is one of the best dividend stocks to buy according to hedge funds. A November 28 Reuters report mentioned that Visa has shared plans to enhance its stablecoin settlement capacity in the Central and Eastern Europe, Middle East, and Africa (CEMEA) region. It is collaborating with Aquanow for this undertaking, which is an expert digital assets platform dealing in liquidity and infrastructure solutions.
Via this partnership, Aquanow’s digital asset network, paired with Visa’s top-notch tech capabilities, will allow Visa’s chain of issuers and buyers to manage transactions with authorized stablecoins, which will lower costs, ensure seamless operations, and reduce settlement timelines.
Visa Inc. (NYSE:V) is seeing higher demand from financial companies to enable quick and affordable international transactions, which is why it is using stablecoins to digitally transform the payment flows. Visa was one of the initial payment providers that settled stablecoin transactions back in 2023, during its pilot phase, where clients could fulfill their settlement transactions using USDC.
Separately, Visa and Mastercard on November 10 reported a $38 billion revised settlement with merchants who argued the card networks charged too much, in response to a judge rejecting a smaller settlement. This agreement would bring to an end 20 years of lawsuits in which businesses accused Visa, Mastercard, and banks of antitrust violations, particularly related to swipe fees. The settlement requires Visa and Mastercard to reduce swipe fees, which were roughly 2.35% in 2024 and normally lie between 2% to 2.5%, by 0.1% for five years. Meanwhile, stand consumer rates would be limited at 1.25% for eight years, which indicates a reduction of over 25%. A court filing also enabled businesses to levy up to 3% surcharges on card transactions while selecting which cards to accept.
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 312
Number of Years of Dividend Payouts: 21
Microsoft Corporation (NASDAQ:MSFT) is one of the best dividend stocks to buy according to hedge funds. On November 27, the French antitrust watchdog, known as the Autorité de la Concurrence, ruled against a complaint filed against Microsoft by Qwant, a domestic search engine that blamed the tech giant for misusing its industry stronghold. The watchdog noted that Qwant did not provide enough evidence to back its allegations and also dropped the interim action against Microsoft.
Last month, Qwant commented that it is anticipating its complaint to be unheard and disqualified, but it will take Microsoft to court or involve other regulators. On this matter, a Microsoft representative stated:
“We agree with the decision and remain committed to providing high-quality search services and fostering innovation for consumers and partners in France and across Europe,”
Qwant claimed that Microsoft is abusing its market power, and it is putting constraints on Qwant’s search results and ads, which means that the company cannot effectively build its own search engine and AI capacity. The company also claimed that Microsoft skewed ad results in its own favor.
In a separate update by Bloomberg, dated November 30, a $2.1 trillion Norwegian sovereign wealth fund, which is also one of its biggest equity shareholders, is voting in favor of Microsoft in its divisive human rights case. Some shareholders wanted the tech giant to revisit its human rights claims as reports broke out claiming that its tools were employed by Israel’s army to carry out extensive surveillance in Gaza and the occupied West Bank.
However, Norges Bank Investment Management, which runs the $2.1 trillion fund, said it plans to vote against this proposal at Microsoft’s virtual annual meeting on December 5. This means the fund is aligned with Microsoft’s actions in terms of human rights.
While we acknowledge the potential of MSFT to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than MSFT and that has 100x upside potential, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
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