In this article, we discuss 5 dividend stocks to buy amid the market decline. If you want to check out some more high quality dividend stocks, go directly to 10 Dividend Stocks to Buy Amid the Market Decline.
5. Merck & Co., Inc. (NYSE:MRK)
Dividend Yield as of 10/17: 2.93%
Number of Hedge Fund Holders: 79
Merck & Co., Inc. (NYSE:MRK) is a giant in the pharmaceutical industry that has increased its annual dividend for 11 straight years. As of 10/17, Merck & Co., Inc. (NYSE:MRK) has a dividend yield of 2.93% and a forward P/E ratio of 12.59, which is pretty attractive. Although the company faces headwinds in terms of valuation if there is a recession, Merck & Co., Inc. (NYSE:MRK) shares are nevertheless near an all time high and the stock has potential to go higher in the long run if it continues innovating.
79 hedge funds in our database held shares of Merck & Co., Inc. (NYSE:MRK) at the end of Q2 2022 with Renaissance Technologies among the top 5 with a holding of over 6.7 million shares.
4. The Home Depot, Inc. (NYSE:HD)
Dividend Yield as of 10/17: 2.7%
Number of Hedge Fund Holders: 80
Although the housing market isn’t very strong right now given the interest rate increases, The Home Depot, Inc. (NYSE:HD) nevertheless is attractive long term given its earnings power and its growth potential. The Home Depot, Inc. (NYSE:HD) also has a pretty attractive current valuation with a forward P/E ratio of 16.22 as of 10/17. The stock has a dividend yield of 2.7% and the company has increased its annual dividend for 12 straight years. Although its stock could go lower if there is a recession or if the markets fall, The Home Depot, Inc. (NYSE:HD) is a quality stock.
80 hedge funds in our database were bullish on The Home Depot, Inc. (NYSE:HD) at the end of the second quarter.
3. Johnson & Johnson (NYSE:JNJ)
Dividend Yield as of 10/17: 2.71%
Number of Hedge Fund Holders: 83
Johnson & Johnson (NYSE:JNJ) is another dividend aristocrat given that it has increased its annual dividend for 60 consecutive years. As a result, it has a dividend yield of 2.71% as of 10/17. Although conglomerates aren’t as popular as they were in the 90’s, Johnson & Johnson (NYSE:JNJ) is a healthcare conglomerate that has only grown over time. In terms of the future, Johnson & Johnson (NYSE:JNJ) could be a good investment if it continues growing its earnings per share like the market expects.
83 hedge funds in our database were long Johnson & Johnson (NYSE:JNJ) at the end of Q2 2022 with Fisher Asset Management holding over 5.7 million shares.
2. Bank of America Corporation (NYSE:BAC)
Dividend Yield as of 10/17: 2.62%
Number of Hedge Fund Holders: 99
Bank of America Corporation (NYSE:BAC) has benefited from the increasing interest rates with greater net interest income. The rapid rate of the raises, however, could eventually cause a recession that might not be as great for Bank of America Corporation (NYSE:BAC)’s earnings in 2023. As a result, the stock is trading at a forward P/E ratio of 9.14 as of 10/17.
While Bank of America Corporation (NYSE:BAC)’s stock could decline if the market declines, the company is still attractive long term given its earnings potential. Bank of America Corporation (NYSE:BAC) also pays a dividend yield of 2.62% as of 10/17.
Bank of America Corporation (NYSE:BAC) ranks #2 on our list of 10 Dividend Stocks to Buy Amid the Market Decline given that 99 hedge funds in our database held shares of the bank at the end of the second quarter.
1. JPMorgan Chase & Co. (NYSE:JPM)
Dividend Yield as of 10/17: 3.45%
Number of Hedge Fund Holders: 104
Although it doesn’t have as long of a history of raising its annual dividend as some other stocks on this list, JPMorgan Chase & Co. (NYSE:JPM) still ranks #1 on our list of 10 Dividend Stocks to Buy Amid the Market Decline.
Due to the Great Recession, JPMorgan Chase & Co. (NYSE:JPM) had to cut its annual dividend and the bank couldn’t raise its dividend until a few years later.
Since 2012, however, JPMorgan Chase & Co. (NYSE:JPM) has increased its annual dividend every year and the stock now yields 3.18%. Although its stock could decline further in an economic recession due to write downs affecting earnings, JPMorgan Chase & Co. (NYSE:JPM) remains arguably the strongest of the big 4 banks and the stock has upside in terms of the long term.
104 hedge funds in our database owned shares of the stock at the end of Q2 2022.
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