11 Best Mid-Cap Dividend Stocks To Buy Now

In this article, we discuss 11 best mid-cap dividend stocks to buy now.

Dividends have historically been an effective hedge against inflation. For example, the S&P 500 declined from 120 to 62.28 in October 1974 before eventually rising again. During January 1973 to July 1984, the total return with dividends reinvested over the 14 years was approximately 400%, which equals 11.6% per year. When adjusted for CPI inflation, these returns came in at 86% or 4.3% per year in real terms. In periods of high market volatility, dividends can potentially become a much larger part of total shareholder returns. 

Jason Ray, CEO of Zenith Wealth Partners in Philadelphia, advised investors on October 4 to pile into dividend stocks as a value play and suggested younger traders with a long investment horizon to seek out alternative assets, including investing in early stage startups and real estate. 

According to Hartford Funds, dividends have played a notable role in the returns to shareholders during the last 50 years. Going back to 1960, 84% of the total return of the S&P 500 Index is attributed to reinvested dividends and compounding. From 1930 to 2021, dividend contribution to the total return of the S&P 500 Index averaged 40%. A Ned Davis study shows that companies that deviated from their dividend policies suffered negative and volatile consequences. Some of the best mid-cap dividend stocks to consider include OneMain Holdings, Inc. (NYSE:OMF), STAG Industrial, Inc. (NYSE:STAG), and Levi Strauss & Co. (NYSE:LEVI). 

Our Methodology 

We selected the following mid-cap dividend stocks based on positive analyst coverage, strong business fundamentals, and robust dividend profiles. The market cap of these stocks ranges from $2 billion to $10 billion and the dividend yields are mentioned as of November 2. We have assessed the hedge fund sentiment from Insider Monkey’s database of 895 elite hedge funds tracked as of the end of the second quarter of 2022. 

Photo by lucas Favre on Unsplash

Best Mid-Cap Dividend Stocks To Buy Now

11. EnLink Midstream, LLC (NYSE:ENLC)

Number of Hedge Fund Holders: 9

Dividend Yield as of November 2: 3.76%

EnLink Midstream, LLC (NYSE:ENLC) is a Texas-based midstream energy company involved in gathering, processing, transporting, storing, and selling natural gas, natural gas liquids, and condensate crude oil. On November 1, EnLink Midstream, LLC (NYSE:ENLC) reported earnings for the third quarter of 2022. The company announced a Q3 GAAP EPS of $0.17 and a revenue of $2.66 billion, outperforming market estimates by approximately $0.04 and $560 million, respectively. The revenue gained 48.6% on a year-over-year basis. 

On October 19, EnLink Midstream, LLC (NYSE:ENLC) declared a $0.1125 per share quarterly dividend, in line with previous. The dividend is payable on November 14, to shareholders of record on October 28. EnLink Midstream, LLC (NYSE:ENLC) is one of the best dividend stocks to invest in. The dividend yield came in at 3.76% on November 2. 

Morgan Stanley analyst Robert Kad upgraded EnLink Midstream, LLC (NYSE:ENLC) on October 19 to Overweight from Equal Weight with a price target of $14, up from $12. He believes the company has “increasing scarcity value” as a G&P with potential volume upside. 

According to Insider Monkey’s data, 9 hedge funds were bullish on EnLink Midstream, LLC (NYSE:ENLC) at the end of the second quarter of 2022, with collective stakes worth $27.6 million, compared to 9 funds in the last quarter worth $20.30 million. John Overdeck and David Siegel’s Two Sigma Advisors is the largest position holder in the company, with 1.17 million shares valued at nearly $10 million. 

In addition to OneMain Holdings, Inc. (NYSE:OMF), STAG Industrial, Inc. (NYSE:STAG), and Levi Strauss & Co. (NYSE:LEVI), EnLink Midstream, LLC (NYSE:ENLC) is one of the best mid-cap dividend stocks to invest in. 

10. Viper Energy Partners LP (NASDAQ:VNOM)

Number of Hedge Fund Holders: 14

Dividend Yield as of November 2: 9.65%

Viper Energy Partners LP (NASDAQ:VNOM) is a Texas-based company that owns, acquires, and operates oil and natural gas properties in North America. With a dividend yield of 9.65% as of November 2, Viper Energy Partners LP (NASDAQ:VNOM) is one of the premier mid-cap dividend stocks to invest in. 

KeyBanc analyst Tim Rezvan initiated coverage of Viper Energy Partners LP (NASDAQ:VNOM) on September 19 with an Overweight rating and a $39 price target. The company’s “symbiotic relationship” with Diamondback Energy, Inc. (NASDAQ:FANG) develops “unparalleled visibility” on production growth and warrants a “best-in-group premium multiple,” which is not reflected in the shares currently, the analyst told investors in a research note. 

According to Insider Monkey’s second quarter database, 14 hedge funds were long Viper Energy Partners LP (NASDAQ:VNOM), compared to 12 funds in the preceding quarter. Charles Davidson’s Wexford Capital is the largest position holder in the company, with a stake worth $434.6 million. 

Here is what Bernzott Capital US Small Cap Value Fund has to say about Viper Energy Partners LP (NASDAQ:VNOM) in its Q1 2022 investor letter:

“Viper Energy (NASDAQ:VNOM): This mineral rights company, possessing a premiere sponsorship with Diamondback Energy, was the top contributor. Buoyed by Diamondback’s advantaged assets in the Permian Basin coupled with elevated oil prices, Viper reported strong earnings that produced significant FCF generation resulting in a 23% increase in distributions on a sequential basis. We expect distributions to continue to rise as Diamondback remains focused on growing production on Viper’s acreage and continue to believe the stock remains undervalued relative to its FCF generation and distribution growth potential.”

9. Medical Properties Trust, Inc. (NYSE:MPW) 

Number of Hedge Fund Holders: 15

Dividend Yield as of November 2: 10.04%

Medical Properties Trust, Inc. (NYSE:MPW) is an Alabama-based real estate investment trust that acquires and develops net-leased hospital facilities. On October 10, Medical Properties Trust, Inc. (NYSE:MPW) announced that its board of directors has authorized the repurchase of up to $500 million of common stock before October 2023. Medical Properties Trust, Inc. (NYSE:MPW) is one of the best dividend stocks to consider, with a dividend yield of 10.04% as of November 2. 

Barclays analyst Steve Valiquette on October 21 reiterated an Overweight rating on Medical Properties Trust, Inc. (NYSE:MPW) but trimmed the price target on the shares to $19 from $23. The analyst generally expects a “slight sequential improvement” in EBITDA across the healthcare services sector in Q3 2022 but he thinks skilled nursing-focused names may have higher than average risk in the second half of 2022 and 2023.

According to Insider Monkey’s Q2 data, 15 hedge funds were long Medical Properties Trust, Inc. (NYSE:MPW), compared to 16 funds in the last quarter. Amy Minella’s Cardinal Capital is the largest position holder in the company, with more than 5 million shares worth $77.3 million. 

8. Ares Capital Corporation (NASDAQ:ARCC)

Number of Hedge Fund Holders: 15

Dividend Yield as of November 2: 9.81%

Ares Capital Corporation (NASDAQ:ARCC) is a business development company focused on the acquisition, recapitalization, mezzanine debt, restructurings, rescue financing, and leveraged buyout transactions of middle market companies. The company delivers a dividend yield of 9.81% as of November 2 and it posted market-beating financial results in Q3 2022. On October 25, Ares Capital Corporation (NASDAQ:ARCC) declared a $0.48 per share quarterly dividend, an 11.6% increase from its prior dividend of $0.43. The dividend is distributable on December 29, to shareholders of record on December 15. It is one of the best dividend stocks to invest in. 

On October 27, Citi analyst Arren Cyganovich maintained a Buy rating on Ares Capital Corporation (NASDAQ:ARCC) but lowered the price target on the stock to $21 from $24 after the Q3 results. Ares Capital Corporation (NASDAQ:ARCC) reported better than anticipated origination activities in a turbulent market and credit remained stable, with its non-accrual ratio flat, the analyst wrote in a research note. However, the analyst trimmed the price target to factor in the high risk of recession in 2023.

According to Insider Monkey’s data, 15 hedge funds were long Ares Capital Corporation (NASDAQ:ARCC) at the end of June 2022, compared to 18 funds in the prior quarter. Paul Marshall and Ian Wace’s Marshall Wace LLP is a prominent stakeholder of the company, with 2.8 million shares worth $51 million. 

7. NextEra Energy Partners, LP (NYSE:NEP)

Number of Hedge Fund Holders: 17

Dividend Yield as of November 2: 4.18%

NextEra Energy Partners, LP (NYSE:NEP) is a Florida-based company that owns and manages contracted clean energy projects in the United States. These comprise wind and solar projects, as well as contracted natural gas pipeline assets. NextEra Energy Partners, LP (NYSE:NEP) declared on October 24 a $0.7875 per share quarterly dividend, a 3.3% increase from its last dividend of $0.7625. The dividend is payable on November 14, to shareholders of record on November 4. NextEra Energy Partners, LP (NYSE:NEP) delivers a dividend yield of 4.18% as of November 2. 

On October 20, KeyBanc analyst Sophie Karp reiterated an Overweight rating on NextEra Energy Partners, LP (NYSE:NEP) but lowered the firm’s price target on the shares to $83 from $89 as utilities reversed 2022 outperformance in the last two weeks of Q3 2022. 

Among the hedge funds tracked by Insider Monkey, NextEra Energy Partners, LP (NYSE:NEP) was part of 17 public stock portfolios at the end of June 2022, with collective stakes worth $162.7 million, compared to 17 in the prior quarter worth $175.3 million. 

Here is what ClearBridge Investments, an investment management firm, said about NextEra Energy Partners, LP (NYSE:NEP) in its Q1 2021 investor letter:

“NEP is a growth-oriented contracted renewables company formed by its sponsor and general partner NextEra Energy (NEE) to own, operate and acquire contracted renewable energy generation assets located in North America. Growth comes from the dropdown of assets from NEE and we anticipate this should allow NEP to provide 12%–15% dividend growth to 2024. Shares were higher amid an improved renewables project backlog following fourth-quarter results. Continued positive green policy news following the Democrats’ runoff election wins also raised expectations of green fiscal stimulus.”

6. AGNC Investment Corp. (NASDAQ:AGNC)

Number of Hedge Fund Holders: 18

Dividend Yield as of November 2: 17.52%

AGNC Investment Corp. (NASDAQ:AGNC) is a Maryland-based real estate investment trust that invests in residential mortgage pass-through securities and collateralized mortgage obligations that are guaranteed by the United States government-sponsored enterprises. AGNC Investment Corp. (NASDAQ:AGNC)’s Q3 non-GAAP earnings per share of $0.84 outperformed Wall Street estimates by $0.15.

On October 10, AGNC Investment Corp. (NASDAQ:AGNC) declared a $0.12 per share monthly dividend, in line with previous. The dividend is distributable on November 9, to shareholders of the company as of October 31. AGNC Investment Corp. (NASDAQ:AGNC)’s dividend yield on November 2 came in at 17.52%. 

Barclays analyst Mark DeVries upgraded AGNC Investment Corp. (NASDAQ:AGNC) on October 27 to Overweight from Equal Weight with a price target of $9, down from $12, following the Q3 results. Mortgage backed security spreads have touched levels not seen since the financial crisis of 2008, “creating attractive investment opportunities with levered returns in the high-teens while book values are biased higher,” the analyst told investors. He sees a favorable risk/reward in the shares.

According to Insider Monkey’s data, 18 hedge funds were bullish on AGNC Investment Corp. (NASDAQ:AGNC) at the end of the second quarter of 2022, compared to 14 funds in the prior quarter. Ken Griffin’s Citadel Investment Group is the leading position holder in the company, with 4.65 million shares worth $51.5 million. 

Like OneMain Holdings, Inc. (NYSE:OMF), STAG Industrial, Inc. (NYSE:STAG), and Levi Strauss & Co. (NYSE:LEVI), AGNC Investment Corp. (NASDAQ:AGNC) is one of the best dividend stocks to monitor as a hedge against inflation.

5. Federal Realty Investment Trust (NYSE:FRT) 

Number of Hedge Fund Holders: 24

Dividend Yield as of November 2: 4.29%

Federal Realty Investment Trust (NYSE:FRT) is a Maryland-based real estate investment trust that invests in shopping centers in the United States. Federal Realty Investment Trust (NYSE:FRT) is a reliable dividend king, having increased its payouts annually for the last 55 years consecutively. It is one of the best dividend stocks to invest in. 

Piper Sandler analyst Alexander Goldfarb on October 7 reiterated an Overweight rating on Federal Realty Investment Trust (NYSE:FRT) but lowered the firm’s price target on the shares to $115 from $125. The analyst “once again” trimmed price targets across real estate “given the continued rising risk premiums.”

According to Insider Monkey’s data, 24 hedge funds reported owning stakes worth $200 million in Federal Realty Investment Trust (NYSE:FRT) at the end of Q2 2022, compared to 23 funds in the last quarter worth $306.3 million. 

4. Levi Strauss & Co. (NYSE:LEVI)

Number of Hedge Fund Holders: 25

Dividend Yield as of November 2: 3.16%

Levi Strauss & Co. (NYSE:LEVI) is an apparel company that designs, markets, and sells jeans, activewear, tops, shorts, skirts, dresses, jackets, footwear, and related accessories for men, women, and children in the Americas, Europe, and Asia. The company sells its products under the Levi’s, Dockers, Signature by Levi Strauss & Co., and Denizen brands. Levi Strauss & Co. (NYSE:LEVI) is one of the premier mid-cap dividend stocks to consider. 

On October 10, Citi analyst Paul Lejuez maintained a Buy rating on Levi Strauss & Co. (NYSE:LEVI) but lowered the price target on the shares to $19 from $27 after the Q3 miss. Levi Strauss & Co. (NYSE:LEVI) is not immune to the macro backdrop across the globe and will likely face turbulent results in the coming quarters, the analyst told investors in a research note. However, “relative brand strength/stability and valuation keep us more positive on this one versus most apparel players in this environment,” added the analyst.

Among the hedge funds tracked by Insider Monkey, Levi Strauss & Co. (NYSE:LEVI) was part of 25 public stock portfolios at the end of Q2 2022, compared to 26 in the prior quarter. Richard Scott Greeder’s Broad Bay Capital is the leading position holder in the company, with 1.3 million shares worth $22.3 million. 

3. STAG Industrial, Inc. (NYSE:STAG)

Number of Hedge Fund Holders: 27

Dividend Yield as of November 2: 4.59%

STAG Industrial, Inc. (NYSE:STAG) is a real estate investment trust focused on the acquisition and operation of single-tenant, industrial properties throughout the United States. STAG Industrial, Inc. (NYSE:STAG) beat market estimates on earnings and revenue in Q3 2022. On October 12, the company declared a $0.1217 per share monthly dividend, in line with previous. The dividend is payable on November 15, to shareholders of record on October 31. STAG Industrial, Inc. (NYSE:STAG) is one of the top dividend stocks to consider. 

On October 18, Wells Fargo analyst Blaine Heck reaffirmed an Overweight rating on STAG Industrial, Inc. (NYSE:STAG) but lowered the price target on the shares to $36 from $41. The analyst views industrial real estate investment trusts as “well positioned in a tough environment” heading into the Q3 reports. It seems that on-the-ground activity has remained resilient throughout Q3 2022, the analyst wrote in a research note.

Among the hedge funds tracked by Insider Monkey, 27 funds reported owning stakes worth $379.3 million in STAG Industrial, Inc. (NYSE:STAG) at the end of June 2022, compared to 21 funds in the earlier quarter worth $528.6 million. Stuart J. Zimmer’s Zimmer Partners held a leading position in the company, comprising 4.8 million shares valued at $150.5 million. 

Here is what Carillon Scout Mid Cap Fund has to say about STAG Industrial, Inc. (NYSE:STAG) in its Q1 2022 investor letter:

“U.S. and around the world, and the higher inflation this cycle than in 2000. Labor inflation and general labor availability were again concerns for many companies. Supply chains eased for some goods, but remained challenged for many commodities including energy, agriculture, and fertilizer due to war and general scarcity, and also in many consumer products as semiconductors remained in short supply. Stag Industrial (NYSE:STAG), a warehouse REIT focused on rural distribution properties, fell as interest rates rose and fear of an economic slowdown gripped markets.”

2. OneMain Holdings, Inc. (NYSE:OMF)

Number of Hedge Fund Holders: 28 

Dividend Yield as of November 2: 9.67%

OneMain Holdings, Inc. (NYSE:OMF) is an Indiana-based financial service holding company focused on consumer finance and insurance businesses. On October 26, OneMain Holdings, Inc. (NYSE:OMF) declared a quarterly dividend per share of $0.95, in line with previous. The dividend is distributable on November 14, to shareholders of the company as of November 7. The dividend yield on November 2 came in at 9.67%. 

On October 28, Citi analyst Arren Cyganovich raised the price target on OneMain Holdings, Inc. (NYSE:OMF) to $39 from $38 and kept a Buy rating on the shares following the Q3 results. OneMain Holdings, Inc. (NYSE:OMF)’s credit tightening actions seem to be working to slow the steep risk in credit losses back towards the targeted levels, the analyst told investors in a research note.

Among the hedge funds tracked by Insider Monkey, 28 funds were long OneMain Holdings, Inc. (NYSE:OMF) at the end of June 2022, compared to 37 funds in the last quarter. Glenn Greenberg’s Brave Warrior Capital is the biggest stakeholder of the company, with 2.8 million shares worth $108 million. 

Here is what Miller Value Partners specifically said about OneMain Holdings, Inc. (NYSE:OMF) in its Q3 2022 investor letter:

“We own OneMain Holdings, Inc. (NYSE:OMF) ($31.33), a subprime consumer credit company, which exemplifies the situation. It trades at 4x earnings with a 12% dividend yield, which we believe is secure through any recession. We estimate that in a severe 2008-style recession (which we don’t expect), it could earn $4 per share, 45% less than its 2022 estimated earnings. The stock is down 48% from its highs, close to a worst-case recession earnings hit. Not a coincidence in my view. It trades for 7x estimated worst-case trough earnings. It’s currently buying back its stock at highly accretive values, and we expect it to grow earnings per share in the high single digits through the cycle. You’re paid handsomely to be patient and take a long-term view.

People think you are crazy to mention a subprime consumer credit company heading into a recession. The market obsesses over marginal change. Gone are the days when incremental news no longer moves a stock because it was already discounted. This creates excess volatility. Most managers have adapted by minimizing or eliminating contrarian buy calls. This scarcity exacerbates volatility, but can also increase opportunity. Therefore, we believe volatility is the price you pay for outperformance.

We believe OMF will recover from any recession and trade at new highs within 3 years. If it just hits its previous highs, it will compound at 31% per year total return. Even if it goes nowhere, you make 12% per year on the dividend alone. Given it is already pricing in a dire recession, fundamentally the stock should find a floor soon. Given all the algorithms that trade on the next headline, I wouldn’t wager much on that. If our analysis is correct, lower near-term prices just amplify the ensuing recovery…” (Click here to read the full text)

1. First American Financial Corporation (NYSE:FAF)

Number of Hedge Fund Holders: 30

Dividend Yield as of November 2: 4.12%

First American Financial Corporation (NYSE:FAF) is a California-based provider of financial services. The company operates through Title Insurance and Services, and Specialty Insurance segments. First American Financial Corporation (NYSE:FAF) posted a Q3 non-GAAP EPS of $1.62, beating market estimates by $0.10. The dividend yield on November 2 came in at 4.12%, and it is one of the best dividend stocks to invest in. 

On October 17, Truist analyst Mark Hughes reiterated a Buy recommendation on First American Financial Corporation (NYSE:FAF) but slashed the price target on the shares to $67 from $77. The analyst updated his model, stating that his open order assumptions follow the latest Fannie Mae forecast, which suggests 20% declines in title premiums and fees next year, partially offset by increased investment income.

According to the second quarter database of Insider Monkey, 30 hedge funds were long First American Financial Corporation (NYSE:FAF), compared to 31 funds in the last quarter. Parag Vora’s HG Vora Capital Management is the leading stakeholder of the company, with 10.85 million shares worth over $574 million. 

You can also take a look at 10 Boring Stocks That Make Money and 12 Best Annual Dividend Stocks To Invest In. 

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Disclosure: None. 11 Best Mid-Cap Dividend Stocks To Buy Now is originally published on Insider Monkey.