In this article, we will discuss 5 dividend stocks to buy according to Thomas Bailard’s hedge fund. If you want to read our detailed analysis of Bailard Inc.’s performance and its investment strategies, go directly to read 10 Best Dividend Stocks to Buy According to Thomas Bailard’s Hedge Fund.
5. Costco Wholesale Corporation (NASDAQ:COST)
Bailard Inc.’s Stake Value: $18,247,000
Costco Wholesale Corporation (NASDAQ:COST) is an American operator of discount stores and is one of the largest retailers in the world. In August, Erste Group upgraded the stock to Buy as the company showed strong sales growth and increased its key profitability ratios in recent quarters.
Costco Wholesale Corporation (NASDAQ:COST) currently pays a quarterly dividend of $0.90 per share and has a yield of 0.69%, as of August 30. The company maintains an 18-year track record of consistent dividend growth.
Bailard Inc. started investing in Costco Wholesale Corporation (NASDAQ:COST) during the second quarter of 2011, purchasing shares worth over $2 million. The hedge fund grew its position in the company over the years and currently owned COST stakes worth over $18.2 million. The company represented 0.71% of the firm’s 13F portfolio in Q2.
At the end of Q2 2022, 64 hedge funds tracked by Insider Monkey owned stakes in Costco Wholesale Corporation (NASDAQ:COST), up from 61 in the preceding quarter. These stakes are collectively valued at over $4.76 billion. With stakes over $2 billion, Fisher Asset Management owned the largest position in the company in Q2.
ClearBridge Investments mentioned Costco Wholesale Corporation (NASDAQ:COST) in its Q4 2021 investor letter. Here is what the firm has to say:
“Portfolio gains were led by a diverse group of contributors. Also in consumer discretionary, Costco, which operates a chain of membership-only big-box retail stores, continues to impress as it takes to share and becomes more relevant for the consumer even as the world opens up.”
4. QUALCOMM Incorporated (NASDAQ:QCOM)
Bailard Inc.’s Stake Value: $18,740,000
QUALCOMM Incorporated (NASDAQ:QCOM) is an American multinational company that manufactures semiconductors and software and also provides services related to wireless technologies. In Q2 2022, Bailard Inc. owned 146,708 shares in the company, boosting its position by 20% during the quarter. The fund’s total QCOM stake amounted to over $18.7 million, which represented 0.73% of its 13F portfolio.
QUALCOMM Incorporated (NASDAQ:QCOM) has been consistently paying dividends to shareholders since 2003 and raised its payouts at a CAGR of 6% in the last five years. Currently, it pays a quarterly dividend of $0.75 per share, with a dividend yield of 2.27%, as recorded on August 31.
In July, Mizuho raised its price target on QUALCOMM Incorporated (NASDAQ:QCOM) to $175 with a Buy rating on the shares, calling the stock a buying opportunity.
As per Insider Monkey’s Q2 2022 database, 71 hedge funds owned $2.8 billion worth of stakes in QUALCOMM Incorporated (NASDAQ:QCOM). In the previous quarter, 73 hedge funds had positions in the company, with stakes valued at over $3.5 billion.
3. The Procter & Gamble Company (NYSE:PG)
Bailard Inc.’s Stake Value: $23,045,000
The Procter & Gamble Company (NYSE:PG) is an Ohio-based multinational consumer goods company that provides a wide range of personal care and hygiene products. The company holds one of the strongest dividend histories, offering dividends to shareholders for the past 132 years. Moreover, in 2022, it extended its dividend growth streak to 66 years. The company pays a quarterly dividend of $0.9133 per share, with a yield of 2.65%, as of August 31.
In Q2 2022, Bailard Inc. owned 160,268 shares in The Procter & Gamble Company (NYSE:PG), after raising its position by 8%. The hedge fund’s total stake in the company stood at over $23 million, which accounted for 0.9% of its 13F portfolio.
Following the company’s fiscal Q4 earnings report, Barclays reiterated its Overweight rating on the stock in August and mentioned that its business model is more defensive in this economic cycle.
Ray Dalio’s Bridgewater Associates owned stakes worth over $970 million in The Procter & Gamble Company (NYSE:PG), becoming its largest stakeholder in Q2. Overall, 71 hedge funds tracked by Insider Monkey presented a bullish stance on the company in Q2, with stakes valued at over $5.5 billion.
2. Johnson & Johnson (NYSE:JNJ)
Bailard Inc.’s Stake Value: $23,394,000
Johnson & Johnson (NYSE:JNJ) is one of the most popular names in Big Pharma. The company was a part of 83 hedge fund portfolios in Q2 2022, the same as in the previous quarter, according to Insider Monkey’s data. The stakes owned by these funds hold a consolidated value of over $6.7 billion.
Bailard Inc. resumed its position in Johnson & Johnson (NYSE:JNJ) during the first quarter of 2016, after selling its stake worth $3.2 million in the third quarter of 2015. In a recent quarter, the hedge fund owned 131,790 JNJ shares, valued at nearly $23.4 million. The company constituted 0.92% of the firm’s 13F portfolio.
Johnson & Johnson (NYSE:JNJ) pays a quarterly dividend of $1.13 per share, growing it by 6.6% in April. This marked the company’s 60th consecutive year of dividend growth. As of August 31, the stock’s dividend yield came in at 2.80%.
In July, SVB Securities maintained its Outperform rating on Johnson & Johnson (NYSE:JNJ) as the underlying demand for its key products remained strong and the management is focusing on controlling costs.
Mayar Capital mentioned Johnson & Johnson (NYSE:JNJ) in its Q2 2022 investor letter. Here is what the firm has to say:
“J&J is currently our largest position and a long-standing holding. The majority of the group’s sales comes from its collection of pharmaceutical franchises, but a large majority (~45%) comes from its collection of medical device businesses and its consumer brands.
Here’s how JNJ make and spend a dollar of revenues: As of 2021, about 55 cents of that dollar comes from its pharmaceutical sales – sales of drugs to pharmacies and distributors – while 30 cents come from the sale of medical devices, such as surgery equipment and orthopaedics. The rest of that dollar in sales comes from sales of JNJ’s consumer brands such as Listerine mouthwash, Nicorette nicotine tablets and Neutrogena cosmetics.
To make that dollar, however, JNJ typically spends about 25 cents to make the products themselves and another 27 cents on marketing and general administrative functions. This leaves JNJ with about 48 cents on the dollar in profit…” (Click here to see the full text)
1. UnitedHealth Group Incorporated (NYSE:UNH)
Bailard Inc.’s Stake Value: $37,559,000
UnitedHealth Group Incorporated (NYSE:UNH) is an American multinational healthcare company that also provides related insurance services. Mizuho lifted its price target on the stock in August to $600 with a Buy rating on the shares, appreciating the company’s strong Q2 results and its overall business outlook.
In Q2 2022, UnitedHealth Group Incorporated (NYSE:UNH) represented 1.47% of Bailard Inc.’s portfolio. The hedge fund owned 73,124 shares in the company, valued at over $37.5 million. UnitedHealth Group Incorporated (NYSE:UNH) started paying annual dividends in 1990 and shifted to quarterly payments in 2010. The company maintains a 12-year streak of dividend growth, raising its payout by 130% in the last five years. It currently pays a quarterly dividend of $1.65 per share, with a dividend yield of 1.27%, as recorded on August 31.
At the end of Q2 2022, 91 hedge funds in Insider Monkey’s database owned stakes in UnitedHealth Group Incorporated (NYSE:UNH), falling from 103 in the previous quarter. These stakes hold a total value of roughly $11 billion. Rajiv Jain, John Armitage, and Ken Griffin were some of the company’s major stakeholders in Q2.
Wedgewood Partners mentioned UnitedHealth Group Incorporated (NYSE:UNH) in its Q2 2022 investor letter. Here is what the firm has to say:
“UnitedHealth Group also contributed to performance during the quarter. United’s operating income grew +3% on difficult year-ago comparisons as benefits members utilized more services compared to last year. Optum Health grew operating income +40% as more patients are enrolled in the Company’s value-based care services. The Company estimates nearly a third of all medical care is unnecessary and represents an opportunity to capture savings for both patients. Optum’s integrated platform of patient data, IT, and service providers are focused on driving out these unnecessary costs and should serve as the engine for long-term, mid-teens earnings per share growth.”
You can also take a look at 10 Small-Cap Stocks that Pay Dividends and Warren Buffett’s 10 Favorite Dividend Stocks for the Rest of 2022
