In this article, we discuss 10 dividend stocks to buy according to billionaire Ken Fisher.
Ken Fisher’s expertise in the investment field and his dissection of the ongoing market conditions often inspire other investors to follow his investment strategies. As the S&P 500 enters the bear market territory, falling 22.12% year-to-date as of June 15, Fisher asserted in his latest interview with Fox News that investors are looking for safe investment options amid mounting inflation and recession fears. He also talked about the historical performance of value stocks, which fare well when the market is down. His in-depth analysis of ongoing market conditions comes from his extensive experience in the field, which spans over 40 years. As of June, the billionaire’s net worth stands at $4.5 billion.
Ken Fisher on Dividend Stocks
Fisher believes that high-dividend stocks have performed quite well at times, but investors should not over-rely on them. He further mentioned that though dividend stocks promise a passive and regular income for investors, sometimes companies slash their dividends to survive a recession. A successful portfolio demands the investments scattered over different industries and risk profiles to reduce the risks of losing capital in a market swoon.
As of Q1 2022, Fisher Asset Management holds a 13F portfolio value of roughly $170 billion, down from $178.5 billion in the previous quarter. The hedge fund invested heavily in the technology sector, with major tech companies Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), and Amazon.com, Inc. (NASDAQ:AMZN) taking up the first three slots in the portfolio.
Our Methodology
In this article, we discuss 10 dividend stocks to buy according to billionaire Ken Fisher. This list is compiled by using data from Fisher Asset Management’s 13F portfolio as of Q1 2022. The stocks mentioned below are ranked according to their positions in the portfolio.
Dividend Stocks to Buy According to Billionaire Ken Fisher
10. 3M Company (NYSE:MMM)
Fisher Asset Management’s Stake Value: $898,066,000
Dividend Yield as of June 15: 4.39%
Number of Hedge Fund Holders: 51
3M Company (NYSE:MMM) is a Minnesota-based manufacturing company that produces a wide range of products belonging to different industries. In the first quarter of 2022, the company reported solid results despite challenging global conditions. The company posted an EPS of $2.65 and revenue of $8.8 billion, beating estimates by $0.34 and $50 million, respectively.
Ken Fisher’s hedge fund started its position in 3M Company with shares worth $15.4 million in 2010. At the end of Q1 2022, the hedge fund owned stakes worth roughly $900 million in the company, which represented 0.52% of Ken Fisher’s portfolio.
On May 10, 3M Company declared a quarterly payout of $1.49 per share, consistent with its previous dividend. The company has raised its dividend at a CAGR of 5.38% in the past five years while maintaining a 63-year track record of dividend growth. As of June 15, the stock’s yield was recorded at 4.39%. In April, Credit Suisse lowered its price target on 3M Company to $161, with a Neutral rating on the shares, as its CEO mentioned that the company is confronted with supply chain issues.
As of Q1 2022, the hedge funds tracked by Insider Monkey remained bullish on 3M Company, as the company was a part of 51 portfolios, up from 41 a quarter earlier. The consolidated value of stakes held by these hedge funds stood at over $1.5 billion. In addition to Ken Fisher, Cliff Asness and Jim Simons were some other major shareholders of the company in Q1.
Like Apple Inc., Microsoft Corporation, and Amazon.com, Inc., 3M Company is also facing unstable market conditions, falling 23.7% in 2022 so far.
9. The Goldman Sachs Group, Inc. (NYSE:GS)
Fisher Asset Management’s Stake Value: $1,047,572,000
Dividend Yield as of June 15: 2.74%
Number of Hedge Fund Holders: 71
The Goldman Sachs Group, Inc. (NYSE:GS) is a leading global financial institution that provides a broad range of financial services, including consumer banking, investment management, and securities. The company’s Q1 earnings showed strength in its Consumer & Wealth Management segment, as it generated revenue of $2.1 billion, up 21% from the same period last year. The company expects its consumer revenues to reach $4 billion by 2024.
On April 14, The Goldman Sachs Group, Inc. announced a quarterly dividend of $2.00 per share, in line with its previous dividend. The company raised its dividend by 60% in June 2021. The stock’s dividend yield came to be recorded at 2.74%, as of the close of June 15. In May, Oppenheimer presented a positive stance on banking sectors due to their continuous dividends and loan growth. The firm set a $519 price target on The Goldman Sachs Group, Inc., with an Outperform rating on the shares.
The Goldman Sachs Group, Inc. is one of the oldest holdings of Fisher Asset Management as the hedge fund started its position in the company during the fourth quarter of 2010, with shares worth a mere $667,000. At the end of Q1 2022, the hedge fund increased its position in the company by 5%, owning over 3.1 million GS shares, worth $1.04 billion. The company accounted for 0.61% of Ken Fisher’s portfolio.
Eagle Capital Management held the largest position in The Goldman Sachs Group, Inc. in Q1, with stakes worth nearly $1.2 billion. Overall, 71 hedge funds in Insider Monkey’s database reported owning stakes in the New York-based company at the end of March 2022, down from 74 in the previous quarter. The collective value of these stakes is roughly $4.6 billion.
Ariel Investments mentioned The Goldman Sachs Group, Inc. in its Q4 2021 investor letter. Here is what the firm has to say:
“Rising interest rates, after a surprisingly long period of low absolute rates and negative “real” rates, will create a headwind. While there has been much debate about the cause of these low rates, we believe the most important factor has been the $120 billion in monthly federal reserve open market bond purchases and the accumulation of an $8 trillion balance sheet. The former will end, and the latter will shrink. It is not just the Fed that has aggressively purchased bonds, bidding up prices and lowering yields. Bond traders and hedge fund managers have added to positions, confident that being on the same side as the Fed was the wise place to be. Now as the Fed is about to become a seller of bonds rather than a buyer, Wall Street’s “smart money” is likely to follow suit. Against this backdrop, fixed income securities and bond substitutes such as high dividend paying utilities and absolute return hedge funds are substantially overpriced and are not likely to produce attractive returns going forward.
This expectation of a reversion to the mean for interest rates helped 2021 performance, though not as much as we had hoped. The yield on the U.S. 10-year Treasury did indeed increase from +0.92% at the beginning of the year to +1.52% at year-end. An underreported story was the poor performance of bonds last year. The Barclays Aggregate Index declined -1.67% for the year ending December compared to a return of +28.71% for equities as measured by the S&P 500. Interest rates have continued to climb in 2022 with the 10-year Treasury at +1.79% as we go to print. This move higher in rates has contributed to our good, early start to 2022. The Goldman Sachs Group, Inc. (GS) jumped +47.59% for the year and +1.73% in the quarter.”
8. Abbott Laboratories (NYSE:ABT)
Fisher Asset Management’s Stake Value: $1,078,739,000
Dividend Yield as of June 15: 1.80%
Number of Hedge Fund Holders: 68
Abbott Laboratories (NYSE:ABT) is an American medical device and healthcare company that manufactures products used for therapeutic purposes. At the end of Q1 2022, Fisher Asset Management held over 9 million shares in the company, valued at over $1.07 billion. The hedge fund increased its position in the company by 5% during the quarter, which represented 0.63% of its 13F portfolio.
On June 10, Abbott Laboratories announced a quarterly dividend of $0.47 per share, having raised it by 4.7% in December 2021. The Dividend King has been raising its payouts consecutively for the past 50 years, coming through as one of the best dividend stocks in Ken Fisher’s portfolio. The stock’s dividend yield was recorded at 1.80% on June 15. In June, Lake Street lifted its price target on Abbott Laboratories to $200, with a Buy rating on the shares.
According to Insider Monkey’s Q1 2022 database, 68 hedge funds held stakes in Abbott Laboratories, compared with 64 a quarter earlier. These stakes are collectively valued at over $4 billion, falling slightly from $4.25 billion worth of stakes held by hedge funds in Q4 2021.
Here is what Richie Capital Group said about Abbott Laboratories in its Q4 2021 investor letter:
“Abbott Labs (ABT – up 20.08%) – Abbot Labs continues to benefit from resurging demand for Covid testing kits. The company is planning to increase their monthly production of BinaxNOW at home rapid tests to 100M a month, a 43% increase from current levels.”
7. NextEra Energy, Inc. (NYSE:NEE)
Fisher Asset Management’s Stake Value: $1,326,902,000
Dividend Yield as of June 15: 2.30%
Number of Hedge Fund Holders: 64
NextEra Energy, Inc. (NYSE:NEE) is one of America’s largest capital investors in clean energy infrastructure, providing services to over 12 million customers across Florida. On June 6, the stock gained 3% as Biden waved tariffs on solar panels for 24 months to accelerate the production of clean energy technologies in the US.
NextEra Energy, Inc. currently pays a quarterly dividend of $0.425 per share, with a dividend yield of 2.30%, as of June 15. The company has 25 years of consistent dividend raises under its belt with a payout ratio of 60%, recorded at the end of 2021. Due to the growth in its operating cash flow and earnings strength, the management is hopeful to continue with its dividend policy in the coming years as well.
Insider Monkey’s Q1 database shows that NextEra Energy, Inc. remained popular among elite funds, with 64 hedge funds owning stakes in the Florida-based company, up from 55 in the previous quarter. These stakes hold a consolidated value of roughly $3 billion. In addition to Ken Fisher, D E Shaw was also one of the prominent stakeholders of the company in the first quarter, holding stakes worth over $125.8 million.
As NextEra Energy, Inc. reported positive results on its Analysts’ Day, BMO Capital set a $93 price target on the stock, with an Outperform rating on the shares. The firm showed concerns about the company’s future performance due to higher interest rates.
At the end of Q1 2022, Fisher Asset Management owned over 15.6 million shares in NextEra Energy, Inc., worth $1.32 billion. The company made up 0.78% of Ken Fisher’s portfolio.
6. Thermo Fisher Scientific Inc. (NYSE:TMO)
Fisher Asset Management’s Stake Value: $1,333,025,000
Dividend Yield as of June 15: 0.23%
Number of Hedge Fund Holders: 101
Thermo Fisher Scientific Inc. (NYSE:TMO) supplies scientific instrumentation and other products to customers that help them in laboratories and clinics. Along with this, the company also provides software services to its consumers around the globe. In Q1 2022, the company delivered strong results, posting a 16% year-over-year growth in its core organic revenue. Moreover, its Covid testing revenue came in at $1.68 billion.
According to Insider Monkey’s Q1 2022 data, 101 elite funds were bullish on Thermo Fisher Scientific Inc., up from 95 in the previous quarter. These stakes hold a consolidated value of roughly $8 billion, down from $9.4 billion worth of stakes owned by hedge funds in Q4 2021.
On May 19, Thermo Fisher Scientific Inc. declared a quarterly dividend of $0.30 per share, with a yield of 0.23%, as recorded on June 15. In February, the company hiked its quarterly dividend by 15%, which marked its fifth year of consecutive dividend growth.
During the first quarter of 2022, Fisher Asset Management increased its position in Thermo Fisher Scientific Inc. by 5%, purchasing additional 104,324 TMO shares. This takes the fund’s total stake in the company to over $1.33 billion, representing 0.78% of Ken Fisher’s portfolio.
Like Apple Inc., Microsoft Corporation, and Amazon.com, Inc., Thermo Fisher Scientific Inc. is also one of the prominent stocks in Ken Fisher’s portfolio.
ClearBridge Investments mentioned Thermo Fisher Scientific Inc. in its Q1 2022 investor letter. Here is what the firm has to say:
“Improving health remains a key impact theme for the portfolio, and over the past year or so we have increased our exposure to the health care sector, through the addition of Thermo Fisher Scientific, a leading health care tools company, a leading provider of fertility benefit management services to self-insured employers that offers a rare win-win-win for employers, employees, health systems, and doctors, with clear savings and quality improvements.”
5. Oracle Corporation (NYSE:ORCL)
Fisher Asset Management’s Stake Value: $1,386,458,000
Dividend Yield as of June 15: 1.82%
Number of Hedge Fund Holders: 61
Oracle Corporation (NYSE:ORCL) is a California-based computer software company that offers a fully integrated stack of cloud applications and cloud platform services. On June 13, the company announced its fiscal Q4 2022 results, posting a 19% year-over-year growth in its Cloud revenue at $2.9 billion. The company’s total revenue came in at $11.8 billion, which exceeded estimates by $190 million.
In June, Oracle Corporation announced a quarterly dividend of $0.32 per share, up 19% from its previous dividend. The company maintains a 12-year streak of consistent dividend growth, with a five-year dividend CAGR standing at 14.68%. As of June 15, the stock’s dividend yield came to be recorded at 1.82%.
Oracle Corporation has been a part of Fisher Asset Management’s portfolio since 2010. At the end of Q1 2022, the firm owned over 16.7 million shares in the company, worth nearly $1.39 billion. It represented 0.81% of Ken Fisher’s portfolio. In June, Jefferies lifted its price target on Oracle Corporation to $75, but kept a Hold rating on the shares, noting that the company’s organic growth rates remained well below the large-cap software average. However, the firm saw strength in its cloud and database businesses.
The number of hedge funds tracked by Insider Monkey owning stakes in Oracle Corporation grew to 61 in Q1 2022, from 57 in the previous quarter. These stakes hold a consolidated value of over $4.3 billion. Among these hedge funds, First Eagle Investment Management held the largest position in the company, with stakes valued at $2.14 billion.
ClearBridge Investments mentioned Oracle Corporation in its Q3 2021 investor letter. Here is what the firm has to say:
“While the information technology (IT) sector in the benchmark stalled amid rising rates, our holdings outperformed in relative terms, helped in part by a strong quarter from Oracle, the dominant provider of on-premise database software for large enterprises globally and an increasingly viable cloud competitor. Solid quarterly results, raised guidance, healthy underlying metrics and an attractive valuation contributed to strong performance during the period.”
4. Union Pacific Corporation (NYSE:UNP)
Fisher Asset Management’s Stake Value: $1,395,808,000
Dividend Yield as of June 15: 2.48%
Number of Hedge Fund Holders: 89
Union Pacific Corporation (NYSE:UNP) is a Nebraska-based transport company that covers 23 states on the western side of the US. Since 2000, the company has achieved a 22% improvement in its locomotive fuel efficiency due to the consistent use of technology in its operations.
On May 19, Union Pacific Corporation announced a 10% hike in its quarterly payout to $1.30 per share. The company has paid uninterrupted dividends to shareholders for the past 123 years. As of June 15, the stock’s dividend yield was recorded at 2.48%. In April, Raymond James appreciated the company’s improved services and its focus on sustainability which would help it generate earnings higher than expected. Considering this, the firm lifted its price target on Union Pacific Corporation to $285, with a Strong Buy rating on the shares.
Fisher Asset Management initiated its position in Union Pacific Corporation during the fourth quarter of 2010, buying shares worth over $313.5million, at an average share price of $44.6. At the end of Q1 2022, the hedge fund owned more than 5 million UNP shares, worth roughly $1.4 billion. The company represented 0.82% of Ken Fisher’s portfolio.
As per Insider Monkey’s Q1 database, 89 elite funds loaded up on Union Pacific Corporation, owning stakes worth over $7 billion. In contrast, 59 hedge funds held stakes in the Nebraska-based company in the previous quarter, worth $5.64 billion.
ClearBridge Investments mentioned Union Pacific Corporation in its Q4 2021 investor letter. Here is what the firm has to say:
“Despite these mixed emerging growth results, the ClearBridge Global Growth Strategy outperformed the benchmark due to resilience among our secular and structural growth holdings. These consistent growers were complemented by solid contributions from structural holdings including Union Pacific.”
3. Eli Lilly and Company (NYSE:LLY)
Fisher Asset Management’s Stake Value: $2,148,979,000
Dividend Yield as of June 15: 1.35%
Number of Hedge Fund Holders: 53
Eli Lilly and Company (NYSE:LLY) is an American pharmaceutical company that provides high-quality products and is mainly known for its clinical depression drugs. During the first quarter of 2022, Fisher Asset Management purchased additional 521,295 LLY shares, increasing its position in the company by 8%. The hedge fund held stakes worth over $2.1 billion in the company, which accounted for 1.26% of Ken Fisher’s portfolio.
In Q1 2022, Eli Lilly and Company posted an EPS of $2.62, beating estimates by $0.32. The company’s revenue of $7.81 billion saw a 14.7% year-over-year growth and also surpassed analysts’ expectations by $520 million. For FY22, the company expects its gross revenue to fall between $28.8 billion to $29.3 billion, versus estimates of $28.47 billion.
On May 2, Eli Lilly and Company stated a quarterly dividend of $0.98 per share, with a dividend yield of 1.35%, as of June 15. 2021 marked the company’s 136th consecutive year of dividend distribution. In June, JPMorgan raised its price target on Eli Lilly and Company following the FDA approval of the company’s drug for type two diabetes. Moreover, the firm also expects LLY to see EPS growth from $8.80 in 2022 to $28 by 2030.
As per Insider Monkey’s Q1 2022 database, 53 hedge funds tracked by Insider Monkey held stakes in Eli Lilly and Company, down from 61 in the previous quarter. These stakes hold a consolidated value of over $5 billion.
Baron Funds mentioned Eli Lilly and Company in its Q1 2022 investor letter. Here is what the firm has to say:
“Eli Lilly and Company (NYSE:LLY) is a global pharmaceutical company with a diverse offering primarily focused on therapeutics. Performance was strong mostly due to consistent financial growth powered by its core diabetes (and future obesity) franchise, as well as the constant drumbeat surrounding the Alzheimer’s therapeutic market, of which Eli Lilly has one of the three potential winning blockbuster candidates in Donanemab. We retain conviction in Eli Lilly given the company’s strong long-term growth outlook.”
2. The Home Depot, Inc. (NYSE:HD)
Fisher Asset Management’s Stake Value: $2,435,009,000
Dividend Yield as of June 15: 2.73%
Number of Hedge Fund Holders: 75
The Home Depot, Inc. (NYSE:HD) specializes in home improvement and sells tools, construction products, and appliances to its consumers. In the first quarter of 2022, the company experienced a positive hedge fund sentiment, with 75 elite funds tracked by Insider Monkey owning stakes in the company, up from 68 in the previous quarter. The consolidated value of these stakes is roughly $5.6 billion.
Fisher Asset Management started investing in The Home Depot, Inc. during Q1 of 2012, purchasing shares worth $308,000. At the end of Q1 2022, the hedge fund owned more than 8 million HD shares, valued at over $2.4 billion. The company made up 1.43% of Ken Fisher’s portfolio.
On May 19, The Home Depot, Inc. announced a quarterly payout of $1.90 per share, with a dividend yield of 2.73%, as of the close of June 15. The company maintains a 14-year track record of consistent dividend growth. Following its strong Q1 results, Citigroup lifted its price target on The Home Depot, Inc. to $348 in May, with a Buy rating on the shares. The firm also increased the company’s FY22 earnings estimates after noticing growth in its major segments.
Ensemble Capital mentioned The Home Depot, Inc. in its Q1 2022 investor letter. Here is what the firm has to say:
“Home Depot (7.7% weight in the Fund): The demand surge for remodeling and home improvement goods sparked by shelter in place orders, remote work going mainstream, and a shortage of homes on the market to buy, ran headlong into the supply chain crisis, triggering surging prices in the products Home Depot sells. But the company has been able to pass nearly all of these increased costs on to customers, with revenue growing 37% over the past two years while gross profits, or the profits the company makes on each item they sell, increased by 35%. Even this small difference appears to be due not to inflation eating away at Home Depot’s profits, but rather be a function of the huge increase in revenue the company has been generating in low margin lumber sales.”
1. American Express Company (NYSE:AXP)
Fisher Asset Management’s Stake Value: $2,933,385,000
Dividend Yield as of June 15: 1.44%
Number of Hedge Fund Holders: 69
American Express Company (NYSE:AXP) is a multinational credit card services company that offers financial and travel-related services to consumers in over 110 countries. In May, the company reported strong credit card metrics, with consumer card total loans of roughly $63 billion, up from $60.5 billion in April 2022.
Fisher Asset Management started investing in American Express Company during the third quarter of 2012, purchasing over 11.6 million shares, worth $660 million. At the end of Q1 2022, the hedge fund owned nearly 15.7 million AXP shares, valued at roughly $3 billion. The company was the tenth-largest holding of the hedge fund, accounting for 1.73% of its 13F portfolio.
American Express Company currently offers a quarterly dividend of $0.52 per share. The company has been raising its dividends consecutively for the past 30 years, with its 5-year dividend CAGR standing at 7.68%. As of June 15, the stock’s dividend yield was recorded at 1.44%.
On June 6, Edward Jones upgraded American Express Company to Buy, noting that the company’s loyal customer base will be less affected by inflationary pressures, due to which AXP is in a better position to sustain spending trends.
At the end of Q1 2022, 69 hedge funds tracked by Insider Monkey presented a bullish stance on American Express Company, up from 64 in the previous quarter. These stakes hold a collective value of over $33.1 billion. With 151.6 million shares valued at $28.3 billion, Berkshire Hathaway was the company’s leading shareholder at the end of March 2022.
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This article is originally published at Insider Monkey.
