In this article, we discuss 10 dividend stocks to buy according to Jim Simons’ Renaissance Technologies.
Jim Simons is the founder of Renaissance Technologies, a quantitative investment management company that specializes in global financial markets. Simons followed a different investment approach than traditional fund managers. His hedge fund utilizes computer models to understand the market cycles and their patterns. Through this, it aims to process large pieces of information simultaneously. As of July, the billionaire’s real-time net worth stood at $28.6 billion.
Gregory Zuckerman, the author of ‘The Man Who Solved the Market’ talked about Simons’ investment strategy in one of his interviews with CNBC. He said that Simons emphasizes the importance of computer models in everyday trading while picking up on market patterns. Zuckerman further said that Renaissance Technologies realized the importance of big data in trading before its peers, and through this, the firm has outperformed the market over the years.
Renaissance Technologies’ innovative strategies have resulted in the firm delivering strong long-term returns. According to a report by Business Insider, the firm’s flagship Medallion Fund returned 66% from 1998 to 2018. The fund also remained a winner during the tech bubble period, returning 128.1% in 2000. The fund’s performance remained stable in the following years, returning 56.6% and 51.1% in 2001 and 2002, respectively. In addition to this, the Medallion Fund gained 76% in 2020 despite the volatile stock market, as reported by CNBC. The report further mentioned that Simons earned $2.6 billion that year, becoming the second-highest paid hedge fund manager.
As of the end of Q2 2022, Renaissance Technologies’ 13F portfolio had a value of $84.4 billion, compared with $85.2 billion in the previous quarter. The hedge fund invested heavily in the tech and healthcare sectors, among others. Some of the firm’s major holdings include Microsoft Corporation (NASDAQ:MSFT), Meta Platforms, Inc. (NASDAQ:META), and Apple Inc. (NASDAQ:AAPL), however, in this article, we will discuss some of the firm’s best dividend stocks.
Jim Simons of Renaissance Technologies
Our Methodology:
For this list, we selected dividend stocks from Renaissance Technologies’ 13F portfolio, as of Q2 2022. The stocks are ranked according to the value of Renaissance Technologies’ stake in them.
10 Dividend Stocks to Buy According to Jim Simons’ Renaissance Technologies
10. Altria Group, Inc. (NYSE:MO)
Renaissance Technologies Stake Value: $366,549,000
Altria Group, Inc. (NYSE:MO) is one of the world’s largest manufacturers of tobacco and related products. On August 25, the company declared a 4% hike in its quarterly dividend to $0.94 per share. This marked the company’s 53rd consecutive year of dividend growth. As of August 29, the stock’s dividend yield came in at 8.18%.
Renaissance Technologies opened its position in Altria Group, Inc. (NYSE:MO) during the second quarter of 2011, buying shares worth over $4.2 million. In Q2 2022, the hedge fund owned over 8.7 million shares in the company, boosting its position by 133%. The fund’s total MO stake amounted to $367 million, which represented 0.43% of Jim Simons’ 13F portfolio.
In addition to MO, Microsoft Corporation (NASDAQ:MSFT), Meta Platforms, Inc. (NASDAQ:META), and Apple Inc. (NASDAQ:AAPL) are some other major holdings of Renaissance Technologies in Q2.
At the end of Q2, 48 hedge funds tracked by Insider Monkey owned stakes in Altria Group, Inc. (NYSE:MO), up from 47 in the previous quarter. Those stakes held a collective value of over $1.83 billion. Arrowstreet Capital was the fund’s leading stakeholder in Q2, owning MO shares worth over $370 million.
9. American Express Company (NYSE:AXP)
Renaissance Technologies Stake Value: $372,915,000
American credit service company American Express Company (NYSE:AXP) was recently lauded by RBC Capital thanks to its strong Q2 earnings. The firm expects American Express to drive strong sustained revenue growth over the long term and raised its price target on the stock to $180 in July with a ‘Sector Perform’ rating on the shares.
Renaissance Technologies resumed its position in American Express Company (NYSE:AXP) during the first quarter of 2022, after selling off its stake worth $2.7 million in Q4 2019. In Q2 2022, the hedge fund owned shares in the company worth nearly $373 million, up from $9.7 million in the previous quarter. The company represented 0.44% of Jim Simons’ portfolio.
American Express Company (NYSE:AXP) has been offering dividends to shareholders for the past 30 years. It currently pays a quarterly dividend of $0.52 per share and the stock has a yield of 1.34% as of August 29.
At the end of June 2022, 67 hedge funds tracked by Insider Monkey owned stakes in American Express Company (NYSE:AXP), down from 69 a quarter earlier. Hedge funds’ collective stakes were valued at $25.2 billion. With a position worth more than $21 billion, Berkshire Hathaway was the company’s leading stakeholder in Q2.
8. AstraZeneca PLC (NASDAQ:AZN)
Renaissance Technologies Stake Value: $387,109,000
AstraZeneca PLC (NASDAQ:AZN) is a British-Swedish pharmaceutical and biotech company that specializes in innovative medications. The company was a part of 47 hedge funds’ portfolios in Q2, compared with 45 in the previous quarter, according to Insider Monkey’s data. The stakes owned by those hedge funds had a total value of roughly $5 billion.
In Q2, Renaissance Technologies increased its position in AstraZeneca PLC (NASDAQ:AZN) by 29%, which lifted the fund’s total stake to over $387 million in value. The company accounted for 0.45% of Jim Simons’ portfolio.
AstraZeneca PLC (NASDAQ:AZN) pays dividends twice a year to its shareholders. In February, the company declared a second interim dividend of $1.97 per share, which takes its full-year dividend to $2.87 per share. As of August 29, the stock has a dividend yield of 2.88%.
In August, Argus upgraded AstraZeneca PLC (NASDAQ:AZN) to ‘Buy’ from ‘Hold’, with a $75 price target, appreciating the company’s impressive growth and higher margins.
Carillon Tower Advisers mentioned AstraZeneca PLC (NASDAQ:AZN) in its Q1 2022 investor letter. Here is what the firm had to say:
“AstraZeneca (NYSE:AZN) performed strongly and reported encouraging fourth-quarter earnings and initial 2022 guidance. AstraZeneca also announced positive clinical data for two drugs within its oncology business that should serve as important long-term growth drivers.”
7. JPMorgan Chase & Co. (NYSE:JPM)
Renaissance Technologies Stake Value: $442,765,000
JPMorgan Chase & Co. (NYSE:JPM) is an American multinational investment banking and financial services company. It is one of the best dividend stocks in Jim Simons’ portfolio as the company has been raising its payouts consistently for the past 11 years. The company pays a quarterly dividend of $1 per share, with JPM shares having a dividend yield of 3.50% as of August 29.
Renaissance Technologies has been investing in JPMorgan Chase & Co. (NYSE:JPM) since 2011, opening its position with shares worth nearly $200 million. In Q2 2022, the hedge fund owned a stake in the company worth $443 million, as it increased its position by 245% during the quarter. The company made up 0.52% of Jim Simons’ portfolio.
In July, RBC Capital highlighted JPMorgan Chase & Co. (NYSE:JPM)’s core banking Q2 results and its organic growth and set a $130 price target on the stock, with an ‘Outperform’ rating on the shares.
As of the close of Q2, 104 hedge funds in Insider Monkey’s database owned stakes in JPMorgan Chase & Co. (NYSE:JPM), falling from 110 in the previous quarter. The collective value of those stakes was over $5.8 billion, compared with $5 billion worth of stakes owned by hedge funds in the preceding quarter.
Carillon Tower Advisers mentioned JPMorgan Chase & Co. (NYSE:JPM) in its Q1 2022 investor letter. Here is what the firm had to say:
“More cyclical sectors, including technology and consumer discretionary, were among the weakest, likely due to rising interest rates and inflation. It was encouraging to see the quarter finish on a strong note with the S&P 500 only about 5% away from its all-time highs. Shares of JPMorgan Chase (NYSE:JPM) detracted from performance due to the company’s increased expense guidance, announced in January.”
6. PepsiCo, Inc. (NASDAQ:PEP)
Renaissance Technologies Stake Value: $454,484,000
An American beverage company, PepsiCo, Inc. (NASDAQ:PEP) has been offering dividends to shareholders consistently since 1965. In addition to this, the company is also in the midst of a 50-year streak of dividend growth. It currently pays a quarterly dividend of $1.15 per share and the stock has a yield of 2.69% as of August 29.
In Q2, Renaissance Technologies owned over 2.7 million shares in PepsiCo, Inc. (NASDAQ:PEP), valued at over $454 million. This is compared with $328 million worth of PEP shares owned by the fund in the previous quarter. The company represented 0.53% of Jim Simons’ portfolio in Q2. Microsoft Corporation (NASDAQ:MSFT), Meta Platforms, Inc. (NASDAQ:META), and Apple Inc. (NASDAQ:AAPL) are other major holdings of the hedge fund.
In August, Morgan Stanley mentioned PepsiCo, Inc. (NASDAQ:PEP) in its investors’ note, expecting the company to outperform in the upcoming quarters. The firm gave an ‘Overweight’ rating to the stock.
The number of hedge funds tracked by Insider Monkey owning stakes in PepsiCo, Inc. (NASDAQ:PEP) stood at 65 in Q2, growing from 62 in the previous quarter. Those stakes had a total value of over $5.28 billion. Fundsmith LLP owned over $1.1 billion in PEP shares on June 30, becoming its largest stakeholder in Q2.
ClearBridge Investments mentioned PepsiCo, Inc. (NASDAQ:PEP) in its Q2 2022 investor letter. Here is what the firm had to say:
“Also in the stable and predictable cash flow camp, though with a very different business model, global food and beverage company PepsiCo (NYSE:PEP) reported very strong organic growth in the first quarter, driven by healthy price/mix, and raised revenue guidance, while holding EPS guidance. Notably, its beverage business showed expanding margins.”
5. The Home Depot, Inc. (NYSE:HD)
Renaissance Technologies Stake Value: $480,219,000
The Home Depot, Inc. (NYSE:HD) is a Georgia-based home improvement company that sells construction products and offers related services to consumers. The company has been raising its dividends consistently for the past 14 years. It currently pays a quarterly dividend of $1.90 per share, giving HD shares a yield of 2.56% as of August 29.
In Q2 2022, Renaissance Technologies owned over 1.7 million shares in The Home Depot, Inc. (NYSE:HD), valued at over $480 million. The hedge fund reduced its position in the company by 7% during the quarter. The company accounted for 0.56% of Jim Simons’ portfolio.
In August, Truist lifted its price target on The Home Depot, Inc. (NYSE:HD) to $399 with a ‘Buy’ rating on the shares, appreciating the company’s strong business trends despite the macro concerns.
The Home Depot, Inc. (NYSE:HD) was a popular buy among elite funds in Q2, as 80 hedge funds in Insider Monkey’s database owned stakes in the company, up from 75 in the previous quarter. Those stakes had a total value of over $5.35 billion. Fisher Asset Management was the company’s leading stakeholder in Q2.
Diamond Hill Capital mentioned The Home Depot, Inc. (NYSE:HD) in its Q1 2022 investor letter. Here is what the firm had to say:
“Home Depot shares underperformed as continued solid fundamental results were outweighed by concerns about the impact rising mortgage rates may have on the housing market and general inflationary pressures potentially leading to a consumer spending slowdown. We view the long-term prospects and multi-year fundamental outlook as unchanged.”
4. Exxon Mobil Corporation (NYSE:XOM)
Renaissance Technologies Stake Value: $612,907,000
American natural gas and energy company Exxon Mobil Corporation (NYSE:XOM) was assumed with an ‘Outperform’ rating at Credit Suisse in August, with a $125 price target. The firm acknowledged the company’s momentum-building and portfolio investments over the past few years.
Renaissance Technologies resumed its position in Exxon Mobil Corporation (NYSE:XOM) during the first quarter of 2021, purchasing shares worth over $162 million. In Q2 2022, the hedge fund increased its stake in the company by 12%, with its total investment amounting to nearly $613 million. The company represented 0.72% of Jim Simons’ portfolio.
On July 27, Exxon Mobil Corporation (NYSE:XOM) declared a quarterly dividend of $0.88 per share, in line with its previous dividend. The company has paid dividends to shareholders for over 100 years while maintaining a 39-year track record of consistent dividend growth. As of August 29, the stock’s dividend yield came in at 3.52%.
As of the end of Q2, 72 hedge funds tracked by Insider Monkey reported owning stakes in Exxon Mobil Corporation (NYSE:XOM), valued at over $7.4 billion.
Saturna Capital mentioned Exxon Mobil Corporation (NYSE:XOM) in its Q4 2021 investor letter. Here is what the firm had to say:
“Few companies maintain their position at the top for more than a decade or two. One that did was Exxon, which appeared decennially from 1980 through 2010. In 2019 it was ranked 10th, but as of writing has dropped to 39th place.”
3. Merck & Co., Inc. (NYSE:MRK)
Renaissance Technologies Stake Value: $616,668,000
Merck & Co., Inc. (NYSE:MRK) delivers innovative health solutions to its consumers through its medicines, vaccines, and medical devices. In Q2, Renaissance Technologies increased its position in the company by 33%, which raised its total stake in the company to $617 million. The company accounted for 0.73% of Jim Simons’ portfolio.
Merck & Co., Inc. (NYSE:MRK) has been raising its dividends consistently for the past 11 years. The company pays a quarterly dividend of $0.69 per share, giving the stock a dividend yield of 3.15% as of August 29.
In August, Erste Group upgraded Merck & Co., Inc. (NYSE:MRK) to ‘Buy’, mentioning that the company’s profits are well above the sector’s average and are expected to grow further in the future.
At the end of June, 79 hedge funds tracked by Insider Monkey owned stakes in Merck & Co., Inc. (NYSE:MRK), compared with 84 in the previous quarter. The collective value of those stakes was over $6.1 billion. Fisher Asset Management was the company’s largest stakeholder in Q2, owning a position worth over $1.1 billion.
Smead Capital Management mentioned Merck & Co., Inc. (NYSE:MRK) in its Q2 2022 investor letter. Here is what the firm had to say:
“For the quarter, our best-performing stocks included Merck & Co., Inc. (NYSE:MRK). Despite a steep sell-off in June in the oil and gas stocks, two of our oil stocks made the quarterly list. Merck’s defensive characteristics and good news on earnings/growth didn’t shock us. We argued one year ago that Merck was historically cheap relative to the indexes as compared to the last 20 years.”
2. The Kroger Co. (NASDAQ:KR)
Renaissance Technologies Stake Value: $792,589,000
The Kroger Co. (NASDAQ:KR) is an Ohio-based retail company that operates supermarkets and multi-department stores across the U.S. On June 23, the company announced a 24% hike in its quarterly dividend to $0.26 per share. This marked the company’s 16th consecutive year of dividend growth. As of August 29, the stock’s dividend yield came in at 2.15%.
In Q2, Renaissance Technologies owned over 16.7 million shares in The Kroger Co. (NASDAQ:KR), valued at $793 million. The hedge fund raised its position in the company by 2% during the quarter, with it representing 0.93% of the fund’s 13F portfolio.
In June, MKM Partners lifted its price target on The Kroger Co. (NASDAQ:KR) to $55 with a ‘Neutral’ rating on the shares.
As per Insider Monkey’s Q2 database, 49 hedge funds owned stakes in The Kroger Co. (NASDAQ:KR), growing from 45 in the previous quarter. Those stakes were collectively valued at over $4.3 billion, compared with $5.1 billion worth of KR shares owned by hedge funds in Q1.
1. Chevron Corporation (NYSE:CVX)
Renaissance Technologies Stake Value: $837,740,000
Chevron Corporation (NYSE:CVX), an American multinational energy industry company, was the fifth-largest holding of Renaissance Technologies in Q2. The hedge fund owned a stake in the company worth $838 million, up from $134 million in the previous quarter. The company accounted for 0.99% of Jim Simons’ portfolio.
Chevron Corporation (NYSE:CVX) has been raising its dividends consistently for the past 35 years. The company pays a quarterly dividend of $1.42 per share and the stock has a yield of 3.45% as of August 29.
In August, BMO Capital raised its price target on Chevron Corporation (NYSE:CVX) to $180 with an ‘Outperform’ rating on the shares, appreciating the company’s operational performance, asset base, and financial strength.
At the end of Q2, 59 hedge funds tracked by Insider Monkey were bullish on Chevron Corporation (NYSE:CVX), up from 53 in the previous quarter. The stakes owned by those hedge funds had a total value of over $26 billion. Warren Buffett, Ken Fisher, and Ken Griffin were some of the company’s most prominent stakeholders in Q2.
Diamond Hill Capital mentioned Chevron Corporation (NYSE:CVX) in its Q1 2022 investor letter. Here is what the firm had to say:
“Other top contributors in Q1 included multinational energy company Chevron Corp. (NYSE:CVX). The company benefited from increased energy demand as COVID-related economic restrictions eased in tandem with concerns regarding supply interruptions related to Russia’s invasion of Ukraine.”
You can also take a look at Ray Dalio’s Bridgewater Associates Portfolio: Top 10 Dividend Stocks and 10 Best Renewable Energy Stocks to Buy and Hold for the Next 10 Years
Follow Insider Monkey on Twitter
Suggested articles:
- Jim Simons’ Renaissance Technologies Portfolio: 10 Dividend Stock Picks
- Warren Buffett’s 10 Favorite Dividend Stocks for the Rest of 2022
- 9 Dividend Stocks to Buy According to Jacob Mitchell’s Antipodes Partners
Disclosure. None. 10 Dividend Stocks to Buy According to Jim Simons’ Renaissance Technologies is originally published on Insider Monkey.
