In this article, we will discuss top 10 dividend stocks in Bill Gates’ portfolio. You can skip our detailed analysis of the Bill & Melinda Gates Foundation Trust’s investment strategies and their performance over the years, and go directly to read Bill Gates’ Current Portfolio: Top 5 Dividend Stocks.
Bill & Melinda Gates Foundation makes huge donations for philanthropic activities around the world. Since January 2020, the foundation has donated over $2 billion to the Covid-19 response. Moreover, the fund’s total charitable support amounted to over $6.7 billion, as of December 2021.
Bill Gates recently made headlines with his comments on AI. In a podcast with Nicolai Tangen, Gates said that Google’s search business profits are likely to plunge in the future as AI will affect how people search. He further called this technology one of the biggest inventions of the decade due to its exceptional ability to read and write, Fox Business reported.
Bill Gates and Melinda French have been strong proponents of the adverse effects of climate change on the world. In November 2022, the foundation pledged over $1.4 billion to help smallholder farmers to tackle the impact of climate change and improve food security in sub-Saharan Africa and South Asian regions.
At the end of Q4 2022, Bill & Melinda Gates Foundation had a 13F portfolio valued at over $35.7 billion, up from nearly $34 billion in the previous quarter. The hedge fund had investments in the technology, services, finance, and industrial goods sectors. Dividend stocks also made up a significant portion of the fund’s portfolio. Some of its prominent holdings in Q4 were The Kraft Heinz Company (NASDAQ:KHC), Caterpillar Inc. (NYSE:CAT), and Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF). In this article, we will discuss the top dividend stocks in Bill Gates’ portfolio.
Bill Gates
Our Methodology:
For this list, we selected dividend stocks in Bill Gates’ portfolio, as of Q4 2022. The stocks are ranked according to their stake value in Bill & Melinda Gates Foundation.
Bill Gates’ Current Portfolio: Top 10 Dividend Stocks
10. Hormel Foods Corporation (NYSE:HRL)
Bill Gates’ Stake Value: $99,995,460
Dividend Yield as of February 22: 2.42%
Hormel Foods Corporation (NYSE:HRL) is a Minnesota-based food processing company that specializes in selling and packaging of a wide range of food products. In December, Argus raised its price target on the stock to $54 with a Buy rating on the shares, appreciating the company’s recent quarterly earnings.
The Gates Foundation initiated its position in Hormel Foods Corporation (NYSE:HRL) during the fourth quarter of 2022, with shares worth nearly $100 million. The company represented 0.27% of Bill Gates’ portfolio.
Hormel Foods Corporation (NYSE:HRL) currently pays a quarterly dividend of $0.275 per share and has a dividend yield of 2.42%, as of February 22. The company has raised its dividends for 57 years in a row. The Kraft Heinz Company (NASDAQ:KHC), Caterpillar Inc. (NYSE:CAT), and Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF) are some other prominent dividend stocks in the fund’s portfolio.
At the end of Q4 2022, 28 hedge funds tracked by Insider Monkey reported owning stakes in Hormel Foods Corporation (NYSE:HRL), worth over $490.6 million collectively. Among these hedge funds, AQR Capital Management was one of the company’s leading stakeholders in Q4.
9. The Kraft Heinz Company (NASDAQ:KHC)
Bill Gates’ Stake Value: $106,766,046
Dividend Yield as of February 22: 4.01%
The Kraft Heinz Company (NASDAQ:KHC) is an American multinational food company, based in Chicago. During Q4 2022, the hedge fund did not change its position in the company with its total stake amounting to over $106.7 million. The company represented 0.29% of Bill Gates’ portfolio.
On February 15, The Kraft Heinz Company (NASDAQ:KHC) declared a quarterly dividend of $0.40 per share, which fell in line with its previous dividend. The company has been offering dividends to shareholders even before the merger of Kraft and Heinz in 2015. The stock’s dividend yield on February 22 came in at 4.01%.
In February, Piper Sandler raised its price target on The Kraft Heinz Company (NASDAQ:KHC) to $43 with a Neutral rating on the shares. The firm expects the company to show strong sales growth momentum.
As per Insider Monkey’s Q4 2022 database, 39 hedge funds held investments in The Kraft Heinz Company (NASDAQ:KHC), with a collective value of over $13.8 billion. In the previous quarter, 40 elite funds had stakes in the company, worth over $11.8 billion.
8. United Parcel Service, Inc. (NYSE:UPS)
Bill Gates’ Stake Value: $128,761,376
Dividend Yield as of February 22: 3.63%
United Parcel Service, Inc. (NYSE:UPS) is a Georgia-based multinational shipping and supply chain management company. In February, BMO Capital raised its price target on the stock to $185 with a Market Perform rating on the shares. The firm noted the company’s steady execution and solid recent quarterly earnings.
On January 31, United Parcel Service, Inc. (NYSE:UPS) raised its quarterly dividend to $1.62 per share. Through this increase, the company stretched its dividend growth streak to 13 years. The stock has a dividend yield of 3.63%, as of February 22.
The Gates Foundation has been investing in United Parcel Service, Inc. (NYSE:UPS) since the fourth quarter of 2014. In the most recent quarter, the hedge fund owned 740,689 shares in the company, worth over $128.7 million. The company made up 0.36% of Bill Gates’ portfolio.
As of the close of Q4 2022, 36 hedge funds tracked by Insider Monkey owned investments in United Parcel Service, Inc. (NYSE:UPS), worth over $514.6 million.
Diamond Hill Capital mentioned UPS in Q3 2022 investor letter. Here is what the firm has to say:
“United Parcel Service, Inc. (NYSE:UPS) is the world’s largest package deliverer, operating globally. The company and its share price had benefited from pandemic-related spikes in shipping demand while supply was constrained (grounding of airlines and their associated space), leading to increased pricing power. Our view is such conditions will not persist as the environment normalizes. In Q3, UPS reported weak results and a decline in volume in its US domestic business, pressuring the share price.”
7. FedEx Corporation (NYSE:FDX)
Bill Gates’ Stake Value: $265,751,498
Dividend Yield as of February 22: 2.24%
FedEx Corporation (NYSE:FDX) is an American transport company that deals in e-commerce and other related services. On February 17, the company declared a quarterly dividend of $1.15 per share, consistent with its previous dividend. The company maintains a 21-year streak of consistent dividend growth. As of February 22, the stock has a dividend yield of 2.24%.
In February, BofA upgraded FedEx Corporation (NYSE:FDX) to Buy with a $233 price target, up from $204. The firm presented a positive outlook on the company and believes that its aspirational targets are moving closer to reality.
As of the close of Q4 2022, the Gates Foundation owned over 1.5 million shares in FedEx Corporation (NYSE:FDX), worth over $165.7 million. The company accounted for 0.74% of Bill Gates’ portfolio.
At the end of December 2022, 48 hedge funds in Insider Monkey’s database owned stakes in FedEx Corporation (NYSE:FDX), down from 57 in the previous quarter. These stakes have a total value of over $1.48 billion. Ken Griffin and Steve Cohen were some of the company’s leading stakeholders in Q4.
Artisan Partners mentioned FedEx Corporation (NYSE:FDX) in its Q3 2022 investor letter. Here is what the firm has to say:
“Earnings results at FedEx Corporation (NYSE:FDX), a global shipping and logistics firm, disappointed due to slowing volumes—principally in its Express segment, which resulted in negative operating leverage—in addition to continued cost pressures. The Express business has been affected by trade disruptions in Asia from China’s COVID lockdowns, as well as the mix of global consumer spending trending back toward services and away from goods—a normalization of pandemic-driven consumer behavior. A key question for investors is how much of this demand slowdown is idiosyncratic and therefore less likely to repeat and how much is the start of a possible cyclical slowdown. To counter these headwinds, FedEx is looking to achieve cost reductions while it continues to implement multi-year structural cost reduction initiatives focused on technology investments and efficiency gains. Given a mixed track record and the recent earnings miss, there is a high degree of skepticism embedded in the current stock price as it sells for less than 8X our estimate of normalized earnings. While operating results can be choppy, the longer term business economics are highly favorable given the global shipping industry’s consolidated structure and massive barriers to entry that afford operators with pricing power to counter cost inflation and earn respectable returns on capital over the business cycle.”
6. Walmart Inc. (NYSE:WMT)
Bill Gates’ Stake Value: $428,327,598
Dividend Yield as of February 22: 1.55%
Walmart Inc. (NYSE:WMT) is an Arkansas-based multinational retail corporation. On February 21, the company achieved its Dividend King status after raising its dividend for the 50th consecutive year. The company offers a quarterly dividend of $0.57 per share and has a dividend yield of 1.55%, as of February 22.
During the fourth quarter of 2022, the Gates Foundation did not change its position in Walmart Inc. (NYSE:WMT). The hedge fund owned over 3 million shares in the company, worth over $428.3 million. The company represented 1.19% of Bill Gates’ portfolio. The Kraft Heinz Company (NASDAQ:KHC), Caterpillar Inc. (NYSE:CAT), and Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF) were some other prominent holdings of the hedge fund in Q4.
As of the close of Q4 2022, 66 hedge funds tracked by Insider Monkey reported owning stakes in Walmart Inc. (NYSE:WMT), down from 68 in the previous quarter. These stakes have a total value of over $4.8 billion.
Leaven Partners mentioned Walmart Inc. (NYSE:WMT) in its Q3 2022 investor letter. Here is what the firm has to say:
“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 Walmart (NYSE:WMT), has 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%.”
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Disclosure. None. Bill Gates’ Current Portfolio: Top 10 Dividend Stocks is originally published on Insider Monkey.
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