1. Microsoft Corporation (NASDAQ:MSFT)
No of HFs: 234
Total Value of HF Holdings: $42.1 Billion
Microsoft Corporation tops our best dividend stocks with upside potential. The company was mentioned in the Top 5 Earnings Growth Stocks with Dividends for 2021. MSFT offers a dividend yield of 1.02%. You should have bought Microsoft 8 years ago when the shares were trading at $27 and offering a 4% dividend yield. We published multiple articles at the time pointing to the opportunity.
The top hedge fund holder of this stock is Ken Fisher’s Fisher Asset Management which had over $4.7 billion invested in the stock at the end of September.
RiverPark mentioned in an article that the stock entered a second chapter of market-leading growth that will drive the company’s revenue and profits for years to come.
“Microsoft: Microsoft shares were our next top contributor driven by the company’s solid fiscal third quarter results, as well as the strong rebound in technology shares during the month (especially for those firms, like MSFT, that are not currently targets of antitrust investigations ). For its fiscal third quarter (ending March), MSFT’s Commercial Cloud revenue grew 41% yearover-year to $10 billion, generating more than 30% of Microsoft’s total revenue. The company’s two other segments, Productivity and Business Processes and More Personal Computing, grew a combined 14% as overall company revenue grew 16% and Non-GAAP EPS grew 20%.
Microsoft has, we believe, entered a second chapter of market-leading growth that will drive the company’s revenue and profits for years to come. Microsoft’s Cloud Infrastructure offering is in the fastest growing segment of the cloud services market (including software-as-a-service (SaaS)), a market that is characterized by recurring revenues, strong pricing, high levels of customer engagement and high margins. The overall Infrastructure-as-a-Service (IaaS) industry is growing more than 30% per year and is forecast to reach $100 billion of revenues by 2021. We believe that cloud-based services can become the company’s largest revenue and earnings producer and expect Microsoft to generate significant and growing free cash flow ($11 billion last quarter, up 19% year-over-year). The company should deliver at least mid-to-high teens EPS growth, with upside from deploying its $134 billion cash balance ($7 billion was returned to shareholders in the quarter through dividends and share buybacks). We trimmed our position on strength, and Microsoft remains a top five position in in the Fund.”
Please also see top 10 Dividend Stocks That Pay Monthly, 10 Best Beverage Stocks to Buy Now and 12 Best MLP and Pipeline Stocks to Buy Now.
Follow us on twitter: https://twitter.com/insidermonkey
Disclosure: None.
