5 Dividend Stocks to Buy According to Billionaire Louis Bacon

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In this article, we discuss 5 dividend stocks to buy according to billionaire Louis Bacon. If you want to read our detailed analysis of Moore Global Investments’ performance, go directly to read 10 Dividend Stocks to Buy According to Billionaire Louis Bacon

5. Caterpillar Inc. (NYSE:CAT)

Dividend Yield as of August 8: 2.59%
Moore Global Investments’ Stake Value: $15,637,000

Caterpillar Inc. (NYSE:CAT) designs and manufactures machinery, engines, and other products for its consumers. It also provides insurance-related services through a dealer network. Moore Global Investments sold off its $11.2 million worth of stake in the company during the fourth quarter of 2021 and resumed its position in Q1 2022. The hedge fund purchased 70,178 CAT shares, valued at over $15.6 million. The company represented 0.39% of Louis Bacon’s portfolio.

In the first half of 2022, Caterpillar Inc. (NYSE:CAT) generated $2.5 billion in free cash flow and paid over $600 million in dividends during this time. The company’s solid financials confirm that it is well-positioned to raise its dividends in the coming years as well. On June 8, Caterpillar Inc. (NYSE:CAT) announced an 8% hike in its quarterly dividend to $1.20 per share. This was the company’s 28th year of dividend growth with an 89-year history of uninterrupted dividend payments. As of August 8, the stock’s dividend yield stood at 2.59%.

Following the company’s strong quarterly results, Credit Suisse raised its price target on Caterpillar Inc. (NYSE:CAT) in August to $236 with an Outperform rating on the shares.

At the end of March 2022, 54 hedge funds in Insider Monkey’s database were bullish on Caterpillar Inc. (NYSE:CAT), up from 53 in the previous quarter. The stakes owned by these hedge funds are collectively valued at over $4 billion.

Diamond Hill Capital mentioned Caterpillar Inc. (NYSE:CAT) in its Q1 2022 investor letter. Here is what the firm has to say:

“We also initiated a position in Caterpillar (NYSE:CAT), one of the world’s leading manufacturers of construction and mining equipment. It’s a company we know well, as we have owned it in our large cap portfolio for quite some time. Recent share price weakness provided an opportunity for us to add it to our large cap concentrated portfolio at an attractive discount to our estimate of intrinsic value. We believe Caterpillar stands to benefit from increased capital investment supported by a healthier/recovering end market environment, particularly in construction and mining.”


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