5 Best Stocks To Buy For Income

In this article, we discuss the 5 best stocks to buy for income. If you want to read about some more dividend stocks, go directly to the 10 Best Stocks To Buy For Income.

5. Ford Motor Company (NYSE:F)

Number of Hedge Fund Holders: 47

Dividend Yield as of February 14: 4.63%

Ford Motor Company (NYSE:F) is an American multinational automobile manufacturer headquartered in Dearborn, Michigan, United States. Founded by Henry Ford and incorporated on June 16, 1903, the company sells automobiles and commercial vehicles under the Ford brand, and luxury cars under its Lincoln luxury brand. The vehicle maker currently pays a quarterly dividend of $0.15, with a dividend yield of 4.63% as of February 14.

JPMorgan analyst Ryan Brinkman lowered the price target on Ford Motor Company (NYSE:F) to $15 from $16 and maintained an Overweight rating on the shares. The analyst believes Tesla’s “aggressive” price cuts could help “catalyze and accelerate what may have otherwise been a more modest or protracted pricing normalization process.” According to the analyst, the price cuts are positive for consumers, negative for Tesla, negative for other automakers, but potentially positive for parts suppliers. However, the analyst states that an “undemanding valuation” keeps him positive on Ford Motor Company despite what may be a round of negative earnings revisions.

At the end of the third quarter of 2022, 47 hedge funds in the database of Insider Monkey held stakes worth $1.2 billion in Ford Motor Company (NYSE:F), compared to 46 in the preceding quarter worth $608.8 million.

In its Q3 2022 investor letter, Leaven Partners, an asset management firm, highlighted a few stocks and Ford Motor Company (NYSE:F) was one of them. Here is what the fund said:

“In our last quarterly letter, I briefly mentioned that the consensus estimates for corporate profits appeared to be a bit too sanguine. I referenced a Reuters article that reported, as of June 17, Wall Street expected S&P 500 earnings to grow by 9.6% in 2022, which was up from 8.8% in April and from 8.4% in January. That tune began to change at the end of July and accelerated in August and September, as major players, such as Ford (NYSE:F), have recently issued profit warnings and/or have withdrawn guidance. In response, Wall Street has altered its outlook: lowering third-quarter profit growth to 4.6% [2] from 7.2% in early August and slashing full-year profit growth to 4.5%.”

4. 3M Company (NYSE:MMM)

Number of Hedge Fund Holders: 49

Dividend Yield as of February 14: 5.25%

3M Company (NYSE:MMM), also known simply as 3M, is an American multinational conglomerate operating in the fields of industry, worker safety, U.S. health care, and consumer goods. The company manufactures and distributes a broad range of products, from building materials and adhesives to medical and home cleaning supplies. However, its Safety and Industrial segment generates the most sales and profits. On February 7, 3M Company (NYSE:MMM) declared a quarterly dividend rate of $1.50, a $0.01 increase from the previous rate.

On January 26, Mizuho analyst Brett Linzey lowered the price target on 3M Company (NYSE:MMM) to $120 from $130 and kept a Neutral rating on the shares. According to the analyst, the company’s Q4 results were below expectations with a weak start to 2023 expected. He believes that 3M is taking a “prudent, conservative approach,” focusing on inventory normalization and aligning production with demand entering a “potentially turbulent” 2023.

According to Insider Monkey’s data, 3M Company (NYSE:MMM) was part of 49 public stock portfolios at the end of September 2022, compared to 54 in the prior quarter. Ken Fisher’s Fisher Asset Management is the largest stakeholder of the company, with 6.3 million shares worth $703 million.

Mayar Capital mentioned 3M Company (NYSE:MMM) in its Q2 2022 investor letter. Here is what the firm has to say:

“We also bought back into 3M (NYSE:MMM) as the stock reached attractive levels. We’d sold our shares in 3M last year when the price exceeded our estimated fair value, and as better opportunities to invest in presented themselves at the time. Nonetheless, we’ve always liked this business with its diversified revenues, its R&D leadership and its stable margins.

3. AT&T Inc. (NYSE:T)

Number of Hedge Fund Holders: 61

Dividend Yield as of February 14: 5.80%

The world’s largest telecommunications company by revenue and the third largest provider of mobile telephone services in the US, AT&T Inc. (NYSE:T) is an American multinational telecommunications holding company that provides telecommunications, media, and technology services worldwide.

On January 16, Cowen analyst Gregory Williams raised the price target on AT&T Inc. (NYSE:T) to $25 from $24 and maintained a Market Perform rating on the shares of the company.

On December 15, AT&T Inc. (NYSE:T) declared a quarterly dividend of $0.2775 per share, which fell in line with its previous dividend. The company has been raising its dividends consistently for the past 12 years. As of February 14, the stock has a dividend yield of 5.80%.

At the end of Q3 2022, 61 hedge funds tracked by Insider Monkey owned stakes in AT&T Inc. (NYSE:T), up from 55 a quarter earlier. The collective value of these stakes is over $1.53 billion.

Chartwell Investment Partners mentioned AT&T Inc. (NYSE:T) in its Q2 2022 investor letter. Here is what the firm has to say:

“In the Dividend Equity accounts, the three best performers in Q2 includes AT&T (NYSE:T, 2.5%), up 17.1%. AT&T completed the spin of the WarnerMedia business (HBO, CNN, etc.), and the market seemed to like the “back-to-basics” approach. Also, the telco business is expected to do relatively well in an inflationary environment.”

2. Verizon Communications Inc. (NYSE:VZ)

Number of Hedge Fund Holders: 62

Dividend Yield as of February 14: 6.47%

Verizon Communications Inc. (NYSE:VZ), commonly known as Verizon, is an American multinational telecommunications conglomerate. A corporate component of the Dow Jones Industrial Average, the company offers communications, technology, information, and entertainment products and services to consumers, businesses, and governmental entities worldwide.

Cowen analyst Gregory Williams lowered the price target on Verizon Communications, Inc. (NYSE:VZ) to $49 from $55 and kept an Outperform rating on the shares. According to Williams, the company posted mixed Q4 results, thus muting initial 2023 guidance as price hikes, good FWA, and decent Business Wireless are not enough to offset promotion amortization cost pressures.

Verizon Communications Inc. (NYSE:VZ) holds a 16-year track record of consistent dividend growth, one of the longest in the US telecom industry. It currently pays a quarterly dividend of $0.6525 per share and has a dividend yield of 6.47%, as of February 14.

According to Insider Monkey’s data, 62 hedge funds were bullish on Verizon Communications Inc. (NYSE:VZ) at the end of Q3 2022, compared to 58 funds in the prior quarter. Ken Griffin’s Citadel Investment Group is a significant position holder in the company, with 5.2 million shares worth $200.4 million.

Here is what Mawer Investment Management has to say about Verizon Communications Inc. (NYSE:VZ) in its Q3 2022 investor letter:

“There are a few other segments of our portfolios that displayed weakness in the quarter. Cable and telecommunication companies have been an area that has lagged the broader market as their worlds are increasingly colliding. Companies such as Verizon (NYSE:VZ) have been impacted as wireless operators are spending heavily to attract internet subscribers with fixed wired access and the cable companies are trying to build wireless businesses.”

1. Philip Morris International Inc. (NYSE:PM)

Number of Hedge Fund Holders: 63

Dividend Yield as of February 14: 4.99%

One of the companies comprising Big Tobacco, Philip Morris International Inc. (NYSE:PM) is an American multinational tobacco company, with products sold in over 180 countries. On January 29, Philip Morris International Inc. (NYSE:PM) announced a long-term collaboration with KT&G, South Korea’s leading tobacco and nicotine manufacturer, to continue to commercialize KT&G’s innovative smoke-free devices and consumables on an exclusive, worldwide basis. This agreement builds on three years of successful collaboration that has seen Philip Morris commercialize KT&G’s products in more than 30 markets.

On February 2, Morgan Stanley analyst Pamela Kaufman raised the price target on Philip Morris International Inc. (NYSE:PM) to $118 from $109 and kept an Overweight rating on the shares ahead of the company’s Q4 report. The analyst has increased her 2023 estimates by about 9% to reflect the benefit of the Swedish Match acquisition and improving foreign exchange impacts.

According to Insider Monkey’s data, 63 hedge funds were bullish on Philip Morris International Inc. (NYSE:PM) at the end of Q3 2022, compared to 56 funds in the prior quarter. Rajiv Jain’s GQG Partners is the largest stakeholder of the company, with 17.4 million shares worth $1.4 billion.

Here is what Distillate Capital has to say about Philip Morris International Inc. (NYSE:PM) in its Q3 2022 investor letter:

“It makes intuitive sense that our process that employs bottom-up stock selection based on the combination of valuation and quality would reduce the weight in places that outperformed and add to areas that were weaker. The largest exited positions in the quarter were Philip Morris International Inc. (NYSE:PM), which saw its stability score fall slightly below the threshold for inclusion.”

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