10 Best Blue Chip Dividend Stocks Hedge Funds Are Buying

Published July 16, 2021 at 12:46 pm EDT Updated August 19, 2026 at 5:09 am EDT

In this article, we will be looking at the 10 best blue chip dividend stocks hedge funds are buying.

Blue-chip dividend stocks may be among some of the more popular stocks investors tend to consider, because these stocks don’t just offer stability in terms of their financial standing and reputation, but also because they provide stable dividend incomes alongside the benefits of investing in a big name company. Hence, blue-chip dividend stocks like Microsoft Corporation (NASDAQ: MSFT), Visa Inc. (NYSE: V), JPMorgan Chase & Co. (NYSE: JPM), and Johnson & Johnson (NYSE: JNJ) are increasingly popular among hedge funds.

Additionally, while there was a surge in blue-chip stock selloffs this June, Forbes has determined that this would result more in a golden buying opportunity for investors, rather than something that should be considered bad news. It has also been estimated that investors holding a portfolio containing blue-chip stocks like Microsoft Corporation and JPMorgan Chase & Co., among other blue-chip stocks, had gained over 30% from the end of 2019 to September 2020. If a strong blue-chip stock also happens to pay dividends, it can be considered an even better investment option especially during times of inflation, as a Guinness Atkinson research report has estimated that between 1958 to 2017, dividend growth has surpassed the rate of inflation 62% of the times, during the time period studied.

Dividend stocks in general have also mostly outperformed other stocks. Take the S&P 500, for instance. High-yielding dividend stocks within the S&P 500 gained by about 24.8% in 2021 so far, with energy companies leading the fray. Additionally, the Vanguard High Dividend Yield ETF also gained by about 9.3% this year, a value that is twice the gain of the S&P 500. And while the above developments should never be taken to mean that dividend stocks, or blue-chip dividend stocks, will always continue to win, they are enough reason to consider smartly investing in such stocks.

Investing is becoming difficult by the day, even for the smart money. The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.

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Without further ado, let’s take a look at the 10 best blue chip dividend stocks hedge funds are buying.

We selected these stocks based on their track record of dividend increases, hedge fund sentiment, future growth potential and analysts’ ratings. For each stock we mentioned the number of years of consistent dividend hikes and also the number of hedge funds having stakes in it.

Best Blue Chip Dividend Stocks Hedge Funds Are Buying

10. Activision Blizzard, Inc. (NASDAQ: ATVI)

Number of Hedge Fund Holders: 76
Dividend Yield: 0.51%
Number of Years of Consistent Dividend Growth: N/A

Activision Blizzard, Inc. (NASDAQ: ATVI) is an interactive home entertainment company that develops entertainment content in the US and internationally. It is also a renowned gaming company, having produced games like Call of Duty and World of Warcraft. It ranks 10th on our list of the best blue chip dividend stocks hedge funds are buying.

This July, Berenberg raised its price target on Activision Blizzard, Inc. shares from $105 to $110, keeping a Buy rating on the stock. Analyst Jamie Bass has commented that while the ease in global lockdown restrictions may result in lesser engagement for gaming companies, it would merely be a short “bump in the road” before the industry kicks off again.

In the first quarter of 2021, Activision Blizzard, Inc. had an EPS of $0.84, beating estimates by $0.15. The company’s revenue was $2.07 billion, up 35.74% year over year and beating estimates by $285.55 million. Activision Blizzard, Inc. has also gained 1.80% in the past 6 months and 2.69% year to date.

By the end of the first quarter of 2021, 76 hedge funds out of the 866 tracked by Insider Monkey held stakes in Activision Blizzard, Inc. worth roughly $3.58 billion. This is compared to 81 hedge funds in the previous quarter with stakes worth about $3.73 billion.

Like Microsoft Corporation, Visa Inc., JPMorgan Chase & Co., and Johnson & Johnson, Activision Blizzard, Inc. is a good blue-chip dividend stock to invest in.

Cooper Investors, an investment management firm, mentioned Activision Blizzard, Inc. in its first-quarter 2021 investor letter. Here‘s what they said:

“The portfolio established a position in video game publisher Activision Blizzard. As a watchlist company we have followed Activision for several years. As a reminder the role of the watchlist is to allow us to focus on a select group of companies where we seek to observe important signals around either value latency, industry trends or management behaviour that portend attractive investment propositions.

Technology can often play a disruptive role in content, however video games are a clear beneficiary of technology, both in terms of more immersive and realistic gaming experiences as well as the monetisation opportunities this creates…” (Click here to see the full text).

9. NIKE, Inc. (NYSE: NKE)

Number of Hedge Fund Holders: 78
Dividend Yield: 0.68%
Number of Years of Consistent Dividend Growth: 19

NIKE, Inc. (NYSE: NKE) is a designer and developer of athletic footwear, apparel, equipment, and accessories. The company operates globally and ranks 9th on our list of the best blue chip dividend stocks hedge funds are buying.

This July, Argus analyst John Staszak raised NIKE, Inc.’s (NYSE: NKE) price target from $174 to $182, retaining the firm’s Buy rating on the company’s shares. The analyst added that NIKE, Inc. is becoming more powerful as a supplier in light of retailers turning to the company to increase their customer traffic and boost their sales.

In the fiscal fourth quarter of 2021, NIKE, Inc. had an EPS of $0.93, beating estimates by $0.42. The company’s revenue was $12.34 billion, up 95.53% year over year and beating estimates by $1.32 billion. NIKE, Inc. has also gained 14.8% in the past 6 months and 15.3% year to date.

By the end of the first quarter of 2021, 78 hedge funds out of the 866 tracked by Insider Monkey held stakes in NIKE, Inc. worth roughly $5.17 billion. This is compared to 82 hedge funds in the previous quarter with stakes worth about $6.28 billion.

Like Microsoft Corporation, Visa Inc., JPMorgan Chase & Co., and Johnson & Johnson, NIKE, Inc. is a good blue-chip dividend stock to invest in.

8. Merck & Co., Inc. (NYSE: MRK)

Number of Hedge Fund Holders: 79
Dividend Yield: 3.35%
Number of Years of Consistent Dividend Growth: 10

Merck & Co., Inc. is a healthcare company providing pharmaceutical products alongside pharmaceuticals for animal health. It ranks 8th on our list of the best blue chip dividend stocks hedge funds are buying.

This July, Mizuho analyst Mara Goldstein kept the firm’s Buy rating on Merck & Co., Inc. shares, alongside its $100 price target, while commenting that the company’s move to withdraw marketing authorization for pembrolizumab in patients suffering from gastric cancer is not necessarily bad news, and may not impact Merck & Co., Inc. shares.

In the first quarter of 2021, Merck & Co., Inc. had an EPS of $1.40, higher than the previous quarter’s EPS of $1.32. The company’s revenue was $12.08 billion, up 0.19% year over year but missing estimates by $567.83 million. Merck & Co., Inc. has also gained 2.47% in the past year.

By the end of the first quarter of 2021, 79 hedge funds out of the 866 tracked by Insider Monkey held stakes in Merck & Co., Inc. worth roughly $6.49 billion. This is compared to 82 hedge funds in the previous quarter with stakes worth about $7.17 billion.

Like Microsoft Corporation, Visa Inc., JPMorgan Chase & Co., and Johnson & Johnson, Merck & Co., Inc. is a good blue-chip dividend stock to invest in.

Artisan Partners, a high value-added investment management firm, mentioned Merck & Co., Inc. in its first-quarter 2021 investor letter. Here’s what they said:

“In Q1, we initiated a position in Merck, a provider of health care solutions including prescription medicines, vaccines, biologic therapies, animal health and consumer care products. We purchased Merck when the stock came under pressure in part on concerns that the newly minted Biden administration could implement regulatory changes and lower drug costs in the pharmaceutical industry. Recent, but anticipated changes to Merck’s management team have also weighed on shares, as have concerns over the company’s heavy reliance on immunotherapy treatment Keytruda. Notably, Merck is not getting much credit from investors for the 60+ programs it has in clinical development, despite having several solid and large new product opportunities. Additionally, the company’s strong balance sheet and robust free cash flow provide it multiple options for future
partnerships and acquisitions. While Merck is undergoing a period of transition, we think the company’s fundamentals are strong and believe changes to management should be a catalyst for improvement.”

7. Bristol-Myers Squibb Company (NYSE: BMY)

Number of Hedge Fund Holders: 81
Dividend Yield: 2.89%
Number of Years of Consistent Dividend Growth: 11

Bristol-Myers Squibb Company (NYSE: BMY) is also a healthcare company, working to discover, develop, and license biopharmaceutical products across the world. It offers products in the hematology, oncology, cardiovascular, and immunology therapeutic areas, and ranks 7th on our list of the best blue chip dividend stocks hedge funds are buying.

This April, Citigroup reiterated a Buy rating on Bristol-Myers Squibb Company shares with a $77 price target, and in June, Mizuho analyst Salim Syed commented that the company would most likely be able to settle its ongoing litigation in 2-3 years.

In the first quarter of 2021, Bristol-Myers Squibb Company had an EPS of $1.74, higher than the previous quarter’s EPS of $1.46. The company’s revenue was $11.07 billion, up 2.71% year over year but missing estimates by $81.41 million. Bristol-Myers Squibb Company has gained 2.01% in the past 6 months and 10.59% year to date as well.

By the end of the first quarter of 2021, 81 hedge funds out of the 866 tracked by Insider Monkey held stakes in Bristol-Myers Squibb Company worth roughly $5.03 billion. This is compared to 131 hedge funds in the previous quarter with stakes worth about $6.08 billion.

Like Microsoft Corporation, Visa Inc., JPMorgan Chase & Co., and Johnson & Johnson, Bristol-Myers Squibb Company is a good blue-chip dividend stock to invest in.

6. Johnson & Johnson (NYSE: JNJ)

Number of Hedge Fund Holders: 81
Dividend Yield: 2.49%
Number of Years of Consistent Dividend Growth: 58

Johnson & Johnson is a healthcare provider, manufacturing and selling products under the Johnson’s, Clean & Clear, Neutrogena, and other brands. It ranks 6th on our list of the best blue chip dividend stocks hedge funds are buying.

In June, Cantor Fitzgerald’s Louise Chen commented on Johnson & Johnson, stating that the company’s peak sales potential and pharma asset are still going underappreciated. Chen has retained the firm’s Overweight rating on Johnson & Johnson shares and its $200 price target as well.

In the first quarter of 2021, Johnson & Johnson had an EPS of $2.59, beating estimates by $0.24. The company’s revenue was $22.32 billion, up 7.88% year over year and beating estimates by $308.14 million. Johnson & Johnson has also gained 6.31% in the past 6 months and 8.89% year to date.

By the end of the first quarter of 2021, 81 hedge funds out of the 866 tracked by Insider Monkey held stakes in Johnson & Johnson worth roughly $6.91 billion. This is compared to 81 hedge funds in the previous quarter with stakes worth about $5.82 billion.

5. Comcast Corporation (NASDAQ: CMCSA)

Number of Hedge Fund Holders: 88
Dividend Yield: 1.73%
Number of Years of Consistent Dividend Growth: 13

Comcast Corporation (NASDAQ: CMCSA) is a media and technology company operating worldwide to provide cable services, internet, streaming services, and other related services. It ranks 5th on our list of the best blue chip dividend stocks hedge funds are buying.

This July, Benchmark analyst Matthew Harrigan raised the firm’s price target on Comcast Corporation shares to $72, retaining a Buy rating on the stock, adding that the Tokyo Olympics are expected to boost Comcast Corporation owned Peacock’s performance.

In the first quarter of 2021, Comcast Corporation had an EPS of $0.76, beating estimates by $0.18. The company’s revenue was $27.20 billion, up 2.24% year over year and beating estimates by $465.18 million. Comcast Corporation has also gained 18.65% in the past 6 months and 14.37% year to date.

By the end of the first quarter of 2021, 88 hedge funds out of the 866 tracked by Insider Monkey held stakes in Comcast Corporation worth roughly $9.76 billion. This is compared to 84 hedge funds in the previous quarter with stakes worth about $8.83 billion.

Nelson Capital Management, an investment management firm, has mentioned Comcast Corporation in its first-quarter 2021 investor letter. Here’s what they said:

“Comcast is the Largest cable provider in t he U.S. and is the dominant internet access provider in the markets it serves. Though Comcast will likely see further declines in cable subscriptions due to ongoing cord-cutting, it should be able to off set that lost revenue by growing internet access customers and instituting higher pricing. The pandemic has increased the importance of a fast internet connection, with more content streaming to homes at increasingly higher quality. Comcast made significant upgrades early on, allowing it to quickly deploy new technology and increase speeds to meet t he evolving needs of its customers.”

4. UnitedHealth Group Incorporated (NYSE: UNH)

Number of Hedge Fund Holders: 89
Dividend Yield: 1.4%
Number of Years of Consistent Dividend Growth: 11

UnitedHealth Group Incorporated (NYSE: UNH) is an American healthcare company operating to provide consumer-oriented health benefit plans and services, Medicaid plans, children’s health insurance programs, and other related products and services. It ranks 4th on our list of the best blue chip dividend stocks hedge funds are buying.

This July, UnitedHealth Group Incorporated raised its full-year net earnings view to $17.35-$17.85 per share, while raising its EPS view to $18.30-$18.80 per share in light of its performance in the first half of 2021. Seaport Global has also initiated coverage of UnitedHealth Group Incorporated shares with a Buy rating and a $450 price target.

In the first quarter of 2021, UnitedHealth Group Incorporated had an EPS of $5.31, beating estimates by $0.93. The company’s revenue was $70.20 billion, up 8.96% year over year and beating estimates by $1.10 billion. UnitedHealth Group Incorporated has gained 18.06% in the past 6 months and 18.67% year to date.

By the end of the first quarter of 2021, 89 hedge funds out of the 866 tracked by Insider Monkey held stakes in UnitedHealth Group Incorporated worth roughly $12.09 billion. This is compared to 91 hedge funds in the previous quarter with stakes worth about $10.77 billion.

ClearBridge Investments, an investment management firm, mentioned UnitedHealth Group Incorporated in its first-quarter 2021 investor letter. Here’s what they said:

“A good way to conceptualize how we think about portfolio construction is to picture a pyramid. At the bottom of the pyramid are the durable compounding growth companies that form the strong foundation, resilience and consistency for the Strategy. We think these companies should comprise just under half of portfolio assets and feature annual revenue growth rates ranging from two times GDP up to 20% as well as healthy free cash flow generation.

UnitedHealth Group, a name we have owned in the Strategy since 1992, is a good example of a long-term compounder, having grown its revenue base from approximately $600 million to north of $260 billion over that time frame. It remains constantly focused on investing in new growth drivers such as telemedicine and health care analytics. Broadcom and Comcast have delivered similar long-term appreciation through a combination of organic growth, capital deployment into new and adjacent opportunities through merger and acquisition activity as well as returning capital to shareholders through buybacks and dividends.”

3. JPMorgan Chase & Co. (NYSE: JPM)

Number of Hedge Fund Holders: 111
Dividend Yield: 2.32%
Number of Years of Consistent Dividend Growth: 10

JPMorgan Chase & Co. is a global financial services company operating through four segments, namely Consumer & Community Banking, Corporate & Investment Banking, Commercial Banking, and Asset & Wealth Management. It ranks 3rd on our list of the best blue chip dividend stocks hedge funds are buying.

This July, Credit Suisse raised its price target on JPMorgan Chase & Co. from $170 to $177, keeping an Outperform rating on the shares. Analyst Susan Roth Katzke commented that the company’s Q2 EPS was well about her $2.85 estimate and even the estimate of Visible Alpha consensus ($3.18).

In the second quarter of 2021, JPMorgan Chase & Co. had an EPS of $3.78, beating estimates by $0.62. The company’s revenue was $30.48 billion, also beating estimates by $762.45 million. JPMorgan Chase & Co. has also gained 11.89% in the past 6 months and 23.24% year to date.

By the end of the first quarter of 2021, 111 hedge funds out of the 866 tracked by Insider Monkey held stakes in JPMorgan Chase & Co. worth roughly $5.25 billion. This is compared to 112 hedge funds in the previous quarter with stakes worth about $6.96 billion.

2. Visa Inc. (NYSE: V)

Number of Hedge Fund Holders: 164
Dividend Yield: 0.52%
Number of Years of Consistent Dividend Growth: 13

Visa Inc. is a data processing and outsourced services company operating in the information technology sector to provide payments technology across the world. The company facilitates digital payments for its consumers, and any merchants, financial institutions, businesses, strategic partners, and government entities that use its services. It ranks 2nd on our list of the best blue chip dividend stocks hedge funds are buying.

This July, Evercore ISI added Visa Inc. to its Tactical Outperform List, while Baird has also raised its price target on the company’s shares from $282 to $305.

In the fiscal second quarter of 2021, Visa Inc. had an EPS of $1.38, beating estimates by $0.11. The company’s revenue was $5.73 billion, also beating estimates by $175.03 million. Visa Inc. has gained 22.02% in the past 6 months and 12.96% year to date.

By the end of the first quarter of 2021, 164 hedge funds out of the 866 tracked by Insider Monkey held stakes in Visa Inc. worth roughly $26.5 billion. This is compared to 166 hedge funds in the previous quarter with stakes worth about $23.5 billion.

ClearBridge Investments, an investment management firm, mentioned Visa Inc. in its first-quarter 2021 investor letter. Here’s what they said:

“To make room for these new names with more attractive outlooks related to the reopening, we sold out of companies where the thesis is not playing out at the pace we expected including Visa.”

1. Microsoft Corporation (NASDAQ: MSFT)

Number of Hedge Fund Holders: 251
Dividend Yield: 0.8%
Number of Years of Consistent Dividend Growth: 19

Microsoft Corporation is an information technology company that develops, licenses, and supports software, services, devices, and solutions for consumers across the world. It ranks 1st on our list of the best blue chip dividend stocks hedge funds are buying.

This July, Morgan Stanley’s Keith Weiss cited the firm’s Q2 CIO survey to claim that Microsoft Corporation is still leading IT wallet share gainers, and kept the stock as a top pick with an Overweight rating and a $300 price target on Microsoft Corporation shares.

In the fiscal third quarter of 2021, Microsoft Corporation had an EPS of $1.95, beating estimates by $0.17. The company’s revenue was $41.71 billion, up 19.09% year over year and beating estimates by $852.09 million. Microsoft Corporation has gained 32.85% in the past 6 months and 29.78% year to date as well.

By the end of the first quarter of 2021, 251 hedge funds out of the 866 tracked by Insider Monkey held stakes in Microsoft Corporation worth roughly $58.9 billion. This is compared to 251 hedge funds in the previous quarter with stakes worth about $52.8 billion.

You can also take a peek at 20 Largest European Companies by Market Cap and 15 Fastest Growing Dividend Stocks.

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