5 Best Dividend Paying Stocks To Buy Now

4. Bank of America Corporation (NYSE:BAC)

Number of Hedge Fund Holders: 99
Dividend Yield as of September 26: 3.75%

Bank of America Corporation (NYSE:BAC) is one of America’s leading multinational investment bank and financial services holding companies. The bank’s CEO has announced to initiate its digital investments and cryptocurrency research to extend its digital leadership into the future. The bank plans to invest nearly $3.5 billion to enhance its platform.

On July 20, Bank of America Corporation (NYSE:BAC) announced the hike of its quarterly dividend by 5%. Through this increase, the company extended its dividend growth to nine years. It currently offers a quarterly dividend of $0.22 per share, with a dividend yield of 3.75%, as of September 26.

Deutsche Bank mentioned Bank of America Corporation (NYSE:BAC) in its investors’ note and maintained its Buy rating on the stock, as the firm sees upside in the banking sector after underperforming for weeks.

At the end of Q2 2022, 99 hedge funds tracked by Insider Monkey owned stakes in Bank of America Corporation (NYSE:BAC), the same as in the previous quarter. The combined value of these stakes is roughly $36 billion. Warren Buffett and Ken Griffin were some of the company’s most prominent stakeholders in Q2.

Miller Value Partners mentioned Bank of America Corporation (NYSE:BAC) in its Q1 2022 investor letter. Here is what the firm had to say:

“There are many times when volatility and beta give false signals. Banks outperformed in the post-tech bubble bear market of the early 2000s. At the market peak prior to the financial crisis (when risk was the highest in those names!), Bank of America (NYSE:BAC) had a 0.9x beta (based on the trailing 5 years) suggesting its “risk” was below the market’s. Wrong! It massively underperformed in the financial crisis. Realized beta over the 5 years from the pre-crisis’ 2006 peak measured 2.3x.

A much better indicator of actual risk, both before and after the financial crisis, was the quality of the balance sheet and risk-taking appetite. Beta is backwards looking and non-stationary. Relying on it underestimated risk going into the financial crisis and overestimated coming out of it (its beta has continued to fall over the past decade).

We care greatly about risk. We spend a significant amount of time thinking about the risks to our investments. We measure risk as permanent impairment of capital, which means the prices and values don’t bounce back. Business fundamentals determine risk.”