In this article, we discuss the 10 dividend stocks to buy according to billionaire Jeffrey Talpins.
Jeffry Talpins’ Element Capital Management deploys the Modern Macro investment style, which combines value analysis, systematic, and macro fundamental approaches. These strategies were pioneered by Talpins, making the hedge fund one of the top performers in the asset management industry. The fund’s flexible thinking and careful analysis have contributed a lot to evolving its approach over time. Currently, Talpins is serving as the CIO and CEO of Element Capital Management.
In 2016, the hedge fund returned 19.4%, compared with the other hedge funds’ average returns of a mere 2.3%. Element Capital also posted positive returns in 2020. The hedge fund gained 18.8% during the year, returning over $2 billion of the profits to shareholders, Financial Times reported. However, in 2021, the hedge fund reported its worst performance, falling 9% during the year, marking its first year of losses since its inception. In January 2022, the fund again reported a loss of nearly 3%.
As of Q4 2021, Element Capital Management holds a 13F portfolio value of over $1.5 billion, up tremendously from $228.8 million in the previous quarter. Healthcare, services, and consumer goods sectors dominated the hedge fund’s investments during the quarter. Some of the hedge fund’s major investments in the fourth quarter were Amazon.com, Inc. (NASDAQ:AMZN), Netflix, Inc. (NASDAQ:NFLX), and Johnson & Johnson (NYSE:JNJ).
Jeffrey Talpins of Element Capital
Our Methodology:
In this article, we will focus on the dividend stocks in Jeffrey Talpins’ portfolio. For this list, we considered data from Element Capital Management’s 13F portfolio as of Q4 2021.
10 Dividend Stocks to Buy According to Billionaire Jeffrey Talpins
10. Mondelez International, Inc. (NASDAQ:MDLZ)
Number of Hedge Fund Holders: 40
Element Capital Management’s Stake Value: $47,352,000
Dividend Yield as of March 9: 2.28%
Mondelez International, Inc. (NASDAQ:MDLZ) is an American confectionery and food holding company. It currently pays a quarterly dividend of $0.35 per share, having raised it by 11% in 2021. The stock’s dividend yield was recorded to be at 2.28%, as of March 9. Mondelez International, Inc. maintains an 8-year track record of consistent dividend growth, falling into the category of Dividend Challenger. Moreover, the company’s 5-year dividend CAGR stands at 13.4%.
This January, BMO Capital mentioned Mondelez International, Inc. in its investor note, expecting growth in the company’s sales. The firm lifted its price target on the stock to $75, with an Outperform rating on the shares. Element Capital started building its position in Mondelez International, Inc. during the fourth quarter of 2021, with shares worth over $47.3 million. The company was the fund’s tenth-largest holding and represented 3.04% of Jeffrey Talpins’ portfolio. Along with this, some other major blue-chip holdings of Element Capital were Amazon.com, Inc., Netflix, Inc., and Johnson & Johnson.
By the end of Q4 2021, 40 hedge funds tracked by Insider Monkey reported owning stakes in Mondelez International, Inc., down from 46 in the previous quarter. These stakes hold a consolidated value of roughly $1.5 billion. Among these hedge funds, Diamond Hill Capital was the company’s largest stakeholder in Q4, holding shares worth over $611 million.
9. The Procter & Gamble Company (NYSE:PG)
Number of Hedge Fund Holders: 67
Element Capital Management’s Stake Value: $102,876,000
Dividend Yield as of March 9: 2.35%
An American multinational consumer goods company, The Procter & Gamble Company was the fifth-largest holding of Element Capital in Q4 2021. The hedge fund held a stake worth roughly $103 million in the company, which accounted for 6.61% of Jeffrey Talpins’ portfolio.
The number of hedge funds tracked by Insider Monkey holding stakes in The Procter & Gamble Company declined to 67 in Q4 2021, from 69 in the preceding quarter. These stakes hold a value of over $6.6 billion.
The Procter & Gamble Company pays a quarterly dividend of $0.8698 per share, with a dividend yield of 2.35%, as of March 9. The company has been increasing its dividend consistently for the past 65 years, with a 5-year dividend CAGR of 5%. This January, Morgan Stanley named The Procter & Gamble Company as its favorite name in the Household Products category and lifted its price target on the stock to $177 while maintaining an Overweight rating on the share.
8. Colgate-Palmolive Company (NYSE:CL)
Number of Hedge Fund Holders: 48
Element Capital Management’s Stake Value: $23,763,000
Dividend Yield as of March 9: 2.36%
Colgate-Palmolive Company (NYSE:CL), an American multinational consumer products company, suffered a decline in the number of hedge funds having positions in it in Q4 2021. 48 hedge funds tracked by Insider Monkey held positions in the company in the fourth quarter of 2021, down from 54 in the previous quarter. The total value of these stakes is over $2 billion. First Eagle Investment Management held the largest stake in the company in Q4, worth over $988 million.
Colgate-Palmolive Company maintains a 59-year streak of consecutive dividend growth and has increased its dividend at a 3% compounded annually from 2016 to 2020. Currently, the company pays a quarterly dividend of $0.45 per share, with a dividend yield of 2.36%, as of March 9. This January, Credit Suisse set a $90 price target on Colgate-Palmolive Company, with an Outperform rating on the shares.
Colgate-Palmolive Company was one of the latest acquisitions of Element Capital in Q4 2021. The hedge fund started building its position in the company with a stake worth over $23.7 million. The company accounted for 1.52% of Jeffrey Talpins’ portfolio.
First Eagle Investment Management mentioned Colgate-Palmolive Company in its Q1 2021 investor letter. Here is what the firm has to say:
“The leading detractors in the quarter (included) Colgate-Palmolive Company. After a strong 2020 fueled in part by lockdown-driven demand, consumer staples stocks generally cooled during the first quarter as investors shifted attention to the more economically sensitive areas of the market likely to benefit from re-openings and improved discretionary spending. The effects of this rotation could be seen in the share price underperformance of names like Colgate-Palmolive.”
7. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 83
Element Capital Management’s Stake Value: $108,761,000
Dividend Yield as of March 9: 2.50%
This January, Raymond James appreciated the performance of Johnson & Johnson and raised its price target on the stock to $185, with an Outperform rating on the shares.
In 2021, Johnson & Johnson increased its quarterly dividend by 5% at $1.06 per share. The stock’s dividend yield, as of March 9, stood at 2.50%. The company maintains a 59-year track record of dividend growth, which is considered the longest in the healthcare sector. In Q4 2021, Johnson & Johnson was the fourth-largest holding of Element Capital and represented 6.99% of its 13F portfolio.
As per Insider Monkey’s Q4 data, 83 hedge funds held a $7.4 billion worth of stake in Johnson & Johnson. In comparison, 88 hedge funds held positions in the company in the previous quarter, with stakes valued at $6.87 billion.
Distillate Capital mentioned Johnson & Johnson in its Q2 2021 investor letter. Here is what the firm had to say:
“The largest additions in the rebalance, Johnson & Johnson was around 50 and 40 basis points incrementally. J&J underperformed in the quarter while its normalized free cash flows held steady and so its position size was topped off to match the stable cash flows.”
6. General Mills, Inc. (NYSE:GIS)
Number of Hedge Fund Holders: 36
Element Capital Management’s Stake Value: $18,698,000
Dividend Yield as of March 9: 3.14%
General Mills, Inc. (NYSE:GIS), an American food company, pays a quarterly dividend of $0.51 per share, with a dividend yield of 3.14%, as recorded on March 9. The company has been paying dividends to shareholders consecutively for the past 120 years and increased its dividend at a CAGR of 6.7% in the past 20 years.
Jim Simons’ Renaissance Technologies was the largest stakeholder of General Mills, Inc. in Q4 2021, holding stakes valued at roughly $290 million. Overall, 36 hedge funds tracked by Insider Monkey reported owning stakes in the company, up from 32 in the previous quarter. These stakes hold a consolidated value of $781.3 million.
Element Capital started investing in General Mills, Inc. during the fourth quarter of 2021, with stakes worth roughly $18.7 million. The company made up 1.2% of Jeffrey Talpins’ portfolio. The hedge fund also had significant stakes in Amazon.com, Inc., Netflix, Inc., and Johnson & Johnson in Q4. This December, appreciating the company’s better than expected sales growth, Citigroup raised its price target on General Mills, Inc. to $73, and maintained a Buy rating on the shares.
Miller Howard Investments mentioned General Mills, Inc. in its Q3 2021 investor letter. Here is what the firm has to say:
“Other stocks providing balance against our cyclicals include General Mills, Inc.. They pay good dividends supported by stable business models and have a conservative amount of debt. The dividend yield on our Income-Equity Strategy is now 3.6%. The No-MLP version yield is 3.5%. Both yields are roughly 2.5 times the yield on the S&P 500 Index, and we are seeing dividend increases across our portfolios. Our income advantage over the broad market is significant, yet we also believe that we have enough cyclical tilt to perform well in a recovery. We continue to monitor a variety of risks, with inflation and COVID-19 trends being most important.”
5. Pfizer Inc. (NYSE:PFE)
Number of Hedge Fund Holders: 83
Element Capital Management’s Stake Value: $148,156,000
Dividend Yield as of March 9: 3.33%
In Q4 2021, the number of hedge funds tracked by Insider Monkey holding stakes in Pfizer Inc. (NYSE:PFE) grew to 83, from 74 in the previous quarter. The consolidated value of these stakes is over $5 billion, showing significant growth from a $2.6 billion worth of stake held by hedge funds in the preceding quarter.
In December 2021, Pfizer Inc. increased its quarterly dividend by 2.6% at $0.40 per share. The stock’s dividend yield stood at 3.33%, as of March 9. The company has been increasing its dividend consistently for the past 11 years. In February, Wells Fargo set a $60 price target on Pfizer Inc., with an Overweight rating on the shares, expecting growth in the company’s Covid-related sales.
Pfizer Inc. was the largest holding of Element Capital in Q4 2021 and represented 9.53% of Jeffrey Talpins’ portfolio. The hedge fund held a stake worth over $148 million in the company in Q4.
Saturna Capital mentioned Pfizer Inc. 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.”
4. The Clorox Company (NYSE:CLX)
Number of Hedge Fund Holders: 39
Element Capital Management’s Stake Value: $17,609,000
Dividend Yield as of March 9: 3.35%
The Clorox Company (NYSE:CLX) is an American manufacturer of consumer and professional products. As the company’s management indicated a recovery in sales to pre-pandemic levels, in February, Citigroup set a $160 price target on the stock, with a Buy rating on the shares.
The Clorox Company pays a quarterly dividend of $1.16 per share, growing it by 5% in 2021. The stock’s dividend yield, as of March 9, stood at 3.35%. The company has been a dividend payer for the past 50 years and also maintains a 20-year track record of consistent dividend growth. The Clorox Company was one of the latest holdings of Element Capital in Q4 and represented 1.13% of its 13F portfolio.
By the end of Q4 2021, 39 hedge funds in Insider Monkey’s database held stakes in The Clorox Company, up from 34 in the previous quarter. The total value of these stakes is around $1.2 billion. Andy Brown’s Cedar Rock Capital held a stake worth $238 million in the company, becoming its largest stakeholder in Q4.
LRT Capital Management mentioned The Clorox Company in its Q1 2021 investor letter. Here is what the firm has to say:
“For several months now, our largest position has been Clorox – the cleaning products company. Besides wipes, the company also manufactures bleach, charcoal, cat litter, plastic bags, and container products. Clorox benefited during the Covid-19 pandemic from an increased demand for cleaning products. Companies and consumers trust the Clorox brand – a source of the company’s huge competitive advantage.
United Airlines, for example, chose to partner with Clorox in its push to reassure consumers about the safety of air travel. The company is a typical “defensive” holding – subject to very small fluctuations in end market demand. Its branded consumer products remain in strong demand. Historically (pre-Covid), the company’s sales grew in line with GDP, while earnings-per-share grew slightly faster due to operational and financial leverage. We expect sales will decline slightly in the next few quarters as the Covid-19 pandemic comes to an end, but we believe this decline is more than accounted for by the company’s low valuation.
On February 4th, Clorox reported results for Q4 2020, with both earnings and sales beating estimates. Sales grew by +27% (vs. 20% estimate) from the prior year’s Q4, and EPS increased +39% ($2.03 vs. $1.75 expected). The company continues to see robust demand and raised its sales and EPS guidance for the rest of the year. Shares are down 4% year-to-date. We believe the shares are undervalued at 20x trailing and 24x forward earnings and currently represent an excellent opportunity.”
3. Kimberly-Clark Corporation (NYSE:KMB)
Number of Hedge Fund Holders: 32
Element Capital Management’s Stake Value: $14,932,000
Dividend Yield as of March 9: 3.71%
Kimberly-Clark Corporation (NYSE:KMB) is an American manufacturing company that specializes in the production of paper-based consumer products. Element Capital started building its position in the company during Q4 2021, with shares worth roughly $15 million. The Texas-based company constituted 0.96% of Jeffrey Talpins’ portfolio.
As per Insider Monkey’s Q4 2021 data, 32 hedge funds held positions in Kimberly-Clark Corporation, with stakes valued at over $309 million. In the previous quarter, 28 hedge funds held stakes in the company, worth $410.4 million.
On January 26, Kimberly-Clark Corporation announced a 2% increase in its quarterly dividend at $1.16 per share. As of March 9, the stock’s dividend yield was recorded to be at 3.71%. 2022 marked the company’s 50th consecutive year of dividend growth. This January, JPMorgan raised its price target on Kimberly-Clark Corporation to $127, with an Underweight rating on the shares.
2. Walgreens Boots Alliance, Inc. (NASDAQ:WBA)
Number of Hedge Fund Holders: 42
Element Capital Management’s Stake Value: $18,068,000
Dividend Yield as of March 9: 3.93%
Walgreens Boots Alliance, Inc. (NASDAQ:WBA) is an American pharmaceutical company that also deals in beauty product brands. In Q4 2021, the number of hedge funds tracked by Insider Monkey having stakes in the company jumped to 42, from 37 in the previous quarter. These stakes hold a consolidated value of over $1 billion.
Walgreens Boots Alliance, Inc. pays a quarterly dividend of $0.4775 per share, with a dividend yield of 3.93%, as of March 9. The company has been consistently paying dividends for the past 89 years while maintaining a 46-year streak of dividend growth. With shares worth over $18 million, Element Capital started building its position in Walgreens Boots Alliance, Inc. during Q4 2021. The company represented 1.16% of Jeffrey Talpins’ portfolio.
This January, Mizuho presented a positive outlook on Walgreens Boots Alliance, Inc. due to the company’s newly-introduced Covid testing kits. The firm raised its price target on the stock to $56 while keeping a Neutral rating on the shares.
Miller Howard Investments mentioned Walgreens Boots Alliance, Inc. in its Q3 2021 investor letter. Here is what the firm has to say:
“While optimistic about a recovery, we continue to balance our cyclical holdings with dividend-payers in stable, less economically-sensitive industries. We took a position in Walgreens (WBA) based on its low valuation, high dividend yield, and stable business model.”
1. The Kraft Heinz Company (NASDAQ:KHC)
Number of Hedge Fund Holders: 39
Element Capital Management’s Stake Value: $18,290,000
Dividend Yield as of March 9: 4.09%
The Kraft Heinz Company (NASDAQ:KHC)’s current quarterly dividend stood at $0.40 per share, with a dividend yield of 4.09%, as of March 9.
This February, Stifel called The Kraft Heinz Company’s growth outlook ‘encouraging’, and raised its price target on the stock to $41, with a Hold rating on the shares. The Kraft Heinz Company accounted for 1.17% of Jeffrey Talpins’ portfolio in Q4 2021, as his hedge fund held stakes worth over $18 million in the company.
Warren Buffett’s Berkshire Hathaway was the largest shareholder of The Kraft Heinz Company in Q4, holding stakes worth roughly $11.7 billion. Overall, 39 hedge funds tracked by Insider Monkey held stakes in the Chicago-based company in Q4, up from 33 in the previous quarter. These stakes are worth over $12.2 billion.
You can also take a look at 10 Best Dividend Stocks to Buy Under $20 and 10 Best Monthly Dividend Stocks with High Yields
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This article is originally published at Insider Monkey.
