In this article, we discuss the 5 best dividend stocks according to Jim Cramer. If you want to read our detailed analysis of Cramer’s market predictions, go directly to read Best Dividend Stocks According To Jim Cramer.
5. KeyCorp (NYSE:KEY)
Dividend Yield as of December 2: 4.42%
KeyCorp (NYSE:KEY) is an American retail banking company that provides financial services to retail, small businesses, and other clients. In Q3 2022, the company reported revenue of $1.89 billion, which showed a 4% growth from the prior-year period. Its management also approved the remaining $790 million existing share repurchase authorization during the quarter.
Cramer believes that bank stocks can replace tech companies and can be the new market leaders. He recommended KEY due to the bank’s high dividend yield, which is rewarding for investors in the current market.
KeyCorp (NYSE:KEY) is one of the best dividend stocks on our list as it raised its dividend for the 12th consecutive year on November 17. Moreover, its five-year dividend CAGR came in at 16.72%. The company currently pays a quarterly dividend of $0.205 per share and has a dividend yield of 4.42%, as of December 2.
In October, Morgan Stanley maintained an Equal Weight rating on KeyCorp (NYSE:KEY) with a $22 price target, appreciating the company’s fund loan growth.
As per Insider Monkey’s Q3 2022 database, 33 hedge funds owned stakes in KeyCorp (NYSE:KEY), down from 37 in the previous quarter. These stakes are collectively worth over $454.3 million. With 6.3 million shares, Adage Capital Management was the company’s largest stakeholder in Q3.
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4. Realty Income Corporation (NYSE:O)
Dividend Yield as of December 2: 4.77%
Realty Income Corporation (NYSE:O) is an American multinational real estate investment trust company. The company pays a monthly dividend of $0.248 per share and has a dividend yield of 4.77%, as of December 2. It has been raising its dividends consistently for the past 28 years and has paid regular dividends for 100 quarters in a row. This makes the company one of the best dividend stocks on our list.
In October, Raymond James maintained an Outperform rating on Realty Income Corporation (NYSE:O) with a $68 price target. The firm sees the company as a strong risk/reward play within the net lease.
According to Cramer, Realty Income Corporation (NYSE:O) is a reliable stock for the rest of the year because of its strong dividends.
The number of hedge funds tracked by Insider Monkey owning stakes in Realty Income Corporation (NYSE:O) grew to 28 in Q3 2022, from 19 in the previous quarter. These stakes are valued at $422.5 million collectively.
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3. ONEOK, Inc. (NYSE:OKE)
Dividend Yield as of December 2: 5.57%
ONEOK, Inc. (NYSE:OKE) is another dividend stock that is recommended by Jim Cramer in the current market situation. It is an American natural gas transmission company. Cramer holds a positive stance on the energy sector and highlighted the company’s high dividend yield. In Q3 2022, the company reported revenue of roughly $6 billion, which is up 30.3% from the same period last year. Its net income for the quarter came in at $431.8 million, which showed a 10% increase from the prior-year period.
ONEOK, Inc. (NYSE:OKE) offers over 25 years of dividend stability and has raised its dividends at a CAGR of 13% from 2000 to 2021. The company’s consistent dividends and strong cash make it one of the best dividend stocks on our list. It currently pays a quarterly dividend of $0.935 per share and has a dividend yield of 5.57%, as of December 2.
In October, Morgan Stanley maintained an Equal Weight rating on ONEOK, Inc. (NYSE:OKE) with a $70 price target.
As of the close of Q3 2022, 29 hedge funds tracked by Insider Monkey owned stakes in ONEOK, Inc. (NYSE:OKE), compared with 30 in the previous quarter. These stakes are worth $225 million collectively.
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2. Devon Energy Corporation (NYSE:DVN)
Dividend Yield as of December 2: 7.57%
Devon Energy Corporation (NYSE:DVN) engages in the exploration of hydrocarbons. The company reported a strong cash position in Q3 2022, generating $1.5 billion in free cash flow and $2.1 billion in operating cash flow. Moreover, its revenue of $5.43 billion showed a 56.5% growth from the same period last year.
Devon Energy Corporation (NYSE:DVN) is currently a part of Cramer’s Charitable Trust. He holds a positive view of the company because of its strong dividend policy and solid dividend yield. He also recommended the stock with respect to Morgan Stanley’s ‘Year of the Yield’ report, mentioning that DVN can generate solid cash for shareholders if oil prices remain above $75 per barrel.
Devon Energy Corporation (NYSE:DVN) has been making consistent dividend payments to shareholders for the past 29 years, coming through as one of the best dividend stocks on our list. The company pays a quarterly dividend of $1.35 per share and has a dividend yield of 7.57%, as of December 2.
Devon Energy Corporation (NYSE:DVN) was a part of 51 hedge fund portfolios in Q3 2022, according to Insider Monkey’s database. The stakes owned by these hedge funds have a total value of over $1.5 billion.
GoodHaven Capital Management mentioned Devon Energy Corporation (NYSE:DVN) in its Q2 2022 investor letter. Here is what the firm has to say:
“Our biggest dollar gainer within this period was Devon Energy Corporation (NYSE:DVN), a position which emanated from a takeover in early 2021 of our long time holding WPX Energy. We are sitting on a material (unrealized) gain from our cost and are now receiving material dividends thanks to Devon’s thoughtful fixed/variable dividend policy. Energy is now a hot sector for investors but we have had a material exposure for a long time. We remember a bit too well $40 oil, NEGATIVELY PRICED front-month oil contract, and what it’s like to own a company with leverage and negative free cash flow during such periods. Our desire to have our biggest portfolio exposures be high return, growing, reasonably predictable and moderately levered companies lead us to reduce our Devon exposure in the past. When the recent facts and circumstances for the industry changed and appeared supportive of healthy oil prices, we decided to maintain a sizable holding and more recently added to the position. At Devon’s Q1 dividend rate, which is mostly variable in nature, the shares now yield approximately 10% and our yield on our average cost is materially higher. In addition, we maintain additional energy exposure through our long-term (and successful) holding in Hess Midstream and less directly through TerraVest and Berkshire Hathaway’s energy investments.”
1. Pioneer Natural Resources Company (NYSE:PXD)
Dividend Yield as of December 2: 10.90%
Pioneer Natural Resources Company (NYSE:PXD) is a Texas-based company that is engaged in the exploration of hydrocarbons. In one of his shows recorded in September, Cramer recommended buying PXD as the stock offers the largest dividend in the S&P 500.
On October 27, Pioneer Natural Resources Company (NYSE:PXD) declared a quarterly dividend of $5.71 per share. The company has been raising its dividends consistently for the past four years. As of December 2, the stock has a dividend yield of 10.90%.
In Q3 2022, Pioneer Natural Resources Company (NYSE:PXD) reported revenue of $6.09 billion, which showed a 36.5% growth from the same period last year. The company’s operating cash flow for the quarter came in at $3 billion and it generated $1.7 billion in free cash flow.
As of the close of Q3 2022, 49 hedge funds tracked by Insider Monkey owned stakes in Pioneer Natural Resources Company (NYSE:PXD), worth $851.4 million.
In its Q1 2022 investor letter, Carillon Tower Advisers, an asset management firm, mentioned Pioneer Natural Resources Company (NYSE:PXD). Here is what the fund said:
“Pioneer Natural Resources (NYSE:PXD) performed well in a strong energy sector. Pioneer stood out recently with a pledge to return a large majority of free cash flow to shareowners through dividends and stock buybacks, and ended hedging to give shareowners more earnings and dividend potential should oil and gas prices continue to rise.”
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You can also take a look at 10 Best Small-Cap Dividend Stocks to Buy Now and 11 High Dividend Stocks Picked By Billionaire Gabelli
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