5 Best Dividend Stocks on Robinhood

3. Altria Group, Inc. (NYSE:MO)

Number of Hedge Fund Holders: 47
Dividend Yield as of June 6: 6.67%

Altria Group, Inc. (NYSE:MO) is an American manufacturing company that mainly deals in the production of tobacco, cigarettes, and related products. Insider Monkey’s Q1 2022 database shows that the hedge fund interest has spiked in the company, as 47 hedge funds held stakes in it, up from 39 in the previous quarter. The collective value of these stakes is roughly $2 billion, as compared with $1.05 billion worth of stakes held by hedge funds in Q4 2021.

On April 28, Altria Group, Inc. (NYSE:MO) announced its earnings for the first quarter of 2022, posting an EPS of $1.12, which surpassed expectations by $0.03. However, the company’s revenue of $4.82 billion missed the market estimates by $60 million. Following the company’s Q1 results, Deutsche Bank lifted its price target on Altria Group, Inc. (NYSE:MO) to $60, while maintaining a Buy rating on the shares.

On May 19, Altria Group, Inc. (NYSE:MO) announced a quarterly dividend of $0.90 per share, consistent with its previous dividend. In the past 52 years, the company has raised its dividend 56 times, which makes it one of the best dividend stocks. On June 6, the stock’s dividend yield was recorded at 6.67%.

Broyhill Asset Management also mentioned Altria Group, Inc. (NYSE:MO) in its Q2 2021 investor letter. Here is what the firm had to say:

“Altria (MO) shook off the prospects of a ban on menthol and a potential cap on nicotine and gained 20%. We shared our thoughts on these regulations during the quarter, which are available here.

MO Valuation. MO is up ~ 18% YTD (even accounting for the recent sell-off). We expect MO to generate close to $5 in annual FCF per share over the next few years, putting the stock at ~ 10x, which is less than half the market’s multiple today. Over the last decade, shares have traded at an average multiple of 15x and within a range of ~ 10x – 20x (+/-1 standard deviation). The stock yields 7.2% at the current price, close to a 6% premium to treasuries. Historically, shares have traded closer to a 3% premium to the 10Y, which would imply a ~ $75 share price.”