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Billionaire Ray Dalio Likes to Invest in High Dividend Stocks; Should You Follow Him?

Suncor Energy Inc. (USA) (NYSE:SU) also made the list, being one of Mr. Dalio’s top picks and sporting a dividend yield of 3.33%. Similar to many of its peers from the energy sector, the slump in commodity prices did not leave Suncor Energy unaffected as its stock has lost over 17% year-to-date. However, Mr. Dalio seems to be betting on the rebound of the oil & gas company as he more than doubled his position in Suncor Energy Inc. (USA) (NYSE:SU) between April and June to 849,800 shares. Overall, smart money investors are more cautious towards Suncor as 32 funds from our database held less than 3% of the company’s shares at the end of June. Another billionaire that is betting on Suncor Energy Inc. (USA) (NYSE:SU) is Warren Buffett, whose holding company Berkshire Hathaway owns 22.35 million shares of the company as of the end of the second quarter.

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In Centurylink Inc (NYSE:CTL), Mr. Dalio also more than doubled his exposure, to 685,500 shares. The company pays a dividend of $0.54 per share and the 35% decline of the stock since the beginning of 2015 has driven its dividend yield to 8.52%, which is one of the highest in the telecom industry. Among other investors, Centurylink Inc (NYSE:CTL) gained some popularity during the second quarter, as the number of funds with long positions went up to 31 from 26, though the aggregate value of their holdings slumped to $279.79 million from $384.85 million and accounted for only 1.70% of the company’s outstanding stock at the end of June. Among these funds, Bridgewater holds the third-largest stake in Centurylink Inc (NYSE:CTL), trailing Peter Muller’s PDT Capital on the first spot with 1.15 million shares and Joel Greenblatt’s Gotham Asset Management, which holds 941,400 shares.

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Mr. Dalio’s fifth dividend pick is ENSCO PLC (NYSE:ESV), whose stock has a yield of 4.14%, but in which the investor cut his position by 20% over the quarter to 845,300 shares. As another oil & gas company, ENSCO’s stock has lost over 65% year-to-date and lower revenues prompted the company to cut its dividend to $0.15 from $0.75 earlier this year. During the second quarter, the number of investors with long positions in ENSCO PLC (NYSE:ESV) among those we track slid by four to 22, though the aggregate value of these funds’ holdings appreciated to $405.87 million from $336.88 million and totaled 7.80% of the company’s worth at the end of June. Partly the growth of the aggregate value of holdings can be attributed to the 6.4% gains registered by ENSCO PLC (NYSE:ESV)’s stock during the period, but also, many of the top shareholders boosted their positions during the trimester. Among them, Joe Huber’s Huber Capital Management edged up its holding by 15% to 4.43 million shares and ranked as the largest shareholder, followed by Phil Gross and Robert Atchinson’s Adage Capital Management, which increased its stake by 270% to 4.31 million shares.

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Disclosure: None

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