In this article, we will take a look at billionaire Steve Cohen’s top dividend stocks.
Billionaire Steve Cohen is the founder of Point72 Asset Management which as of the end of September has a 13F equity portfolio of over $25 billion. Prior to founding Point72 Asset Management, Cohen was the founder of SAC Capital Advisors which generated higher than average returns for two decades.
Due to the success of SAC Capital Advisors and Point72 Asset Management, Steve Cohen is worth around $12.8 billion according to Bloomberg Billionaires Index. Aside from owning stocks, Cohen also owns the New York Mets.
In terms of Point72 Asset Management, the fund has many different strategies including long short equity investing, and systematic investing.
In terms of long/short equity investing, the strategy is Point72’s largest by asset allocation and is a sector-aligned, multi-manager business where teams are empowered to do deep fundamental research and run unique investing processes.
For systematic investing, Point72 Asset Management designs and implements systematic, computer driven trading strategies to buy and sell across multiple asset classes.
Given that Point72 Asset Management has many different investing teams and the fund also uses computer driven trading strategies for part of its fund, Point72 Asset Management has many different positions. For Q3, for example, the fund has over 1,800 positions in different stocks.
2022
Given high inflation, the Federal Reserve has raised interest rates six times in 2022 so far and U.S. Treasury yields have increased substantially as a result.
Given the higher Treasury yields, many dividend stocks have declined year to date as capital has flowed from dividend stocks into Treasuries which in some instances offer higher yields. As a result, some quality blue chip dividend stocks have fairly low valuations that could be attractive if the Federal Reserve eventually wins its war against inflation.
Given the economic uncertainty currently, however, the market could still go lower if economic data fails to meet expectations. As a result, it could be a good idea for long term investors to own a well diversified portfolio of stocks across many different sectors.
Steven Cohen of Point72 Asset Management
Methodology
For the Billionaire Steve Cohen’s Top 10 Dividend Stocks list, we took 10 stocks that paid a dividend from billionaire Steve Cohen’s Point72 Asset Management’s top 25 positions according to Q3 2022 13F filings.
We ranked them based on Point72 Asset Management’s stake value in the stocks.
Billionaire Steve Cohen’s Top 10 Dividend Stocks
10. GlaxoSmithKline plc (NYSE:GSK)
Point72 Asset Management’s Stake Value as of 9/30: $136,021,000
Percentage of Point72 Asset Management’s 13F Portfolio as of 9/30: 0.54%
Dividend Yield as of 11/18: 4.96%
GlaxoSmithKline plc (NYSE:GSK) is a leading pharmaceutical giant with a dividend yield of almost 5% as of 11/18. Although shares of GlaxoSmithKline plc (NYSE:GSK) are down almost 27% year to date due to broader market weakness and the Zantac lawsuits, Point72 Asset Management initiated a new stake of over $136 million or 0.54% of the fund’s 13F equity portfolio in GlaxoSmithKline plc (NYSE:GSK) in Q3. With estimated average EPS of $3.12 for 2022, $3.39 for 2023, and $3.64 for 2024, GlaxoSmithKline plc (NYSE:GSK)’s annual dividend of $1.64 per share seems secure if the company meets profit expectations.
Alongside Microsoft Corporation (NASDAQ:MSFT), Fidelity National Information Services, Inc. (NYSE:FIS), and AstraZeneca plc (NASDAQ:AZN), GlaxoSmithKline plc (NYSE:GSK) is a top dividend stock in billionaire Steve Cohen’s Point72 Asset Management’s portfolio.
9. Dell Technologies Inc. (NYSE:DELL)
Point72 Asset Management’s Stake Value as of 9/30: $139,308,000
Percentage of Point72 Asset Management’s 13F Portfolio as of 9/30: 0.55%
Dividend Yield as of 11/18: 3.14%
Point72 Asset Management initiated a new stake worth over $139 million at the end of September on leading computer hardware company Dell Technologies Inc. (NYSE:DELL) in Q3 where the price of the stock ranged from around $34 to $49 per share. Given Dell Technologies Inc.’s current price of $42.04, Point72 Asset Management could either be down or up on its position depending on its average price. In terms of analyst estimates, Jim Suva of Citi recently cut his price target to $55 from $60 per share but kept a ‘Buy’ rating on Dell Technologies Inc. citing a weakening environment for PC, smartphone and printers given the macroeconomic headwinds.
Given Point72 Asset Management’s position, Dell Technologies Inc. ranks #9 on our list of Billionaire Steve Cohen’s Top 10 Dividend Stocks.
8. Ross Stores, Inc. (NASDAQ:ROST)
Point72 Asset Management’s Stake Value as of 9/30: $146,784,000
Percentage of Point72 Asset Management’s 13F Portfolio as of 9/30: 0.58%
Dividend Yield as of 11/18: 1.15%
Point72 Asset Management increased its position in Ross Stores, Inc. (NASDAQ:ROST) by 210% in Q3 to end the quarter with a position worth over $146 million in the off-price retail apparel and home fashion chain. Given Ross Stores, Inc.’s surge of almost 10% on November 18 due to stronger than expected Q3 earnings and guidance, the new purchases have been profitable at least in the near term.
Madison Mid Cap Fund commented on Ross Stores, Inc. in a Q3 2022 investor letter,
“Ross Stores is one of our longest-tenured holdings. Its profits have gyrated wildly since the beginning of the pandemic, first from store closures and shutdowns, then from the pent-up demand for apparel, and more recently, from the economic uncertainty. Adding to that, Ross is finding that consumers’ spending trends in terms of mix and categories have been more difficult to predict than usual, resulting in some mismatches between its merchandise assortment and what shoppers want. This doesn’t appear to be a Ross-specific issue, as other apparel retailers have reported similar problems. We attribute this to the unusual post-pandemic environment, and while we don’t have a crystal ball as to when this will normalize, we believe it will.”
7. Juniper Networks, Inc. (NYSE:JNPR)
Point72 Asset Management’s Stake Value as of 9/30: $163,388,000
Percentage of Point72 Asset Management’s 13F Portfolio as of 9/30: 0.65%
Dividend Yield as of 11/18: 2.66%
Billionaire Steve Cohen’s Point72 Asset Management increased its position in Juniper Networks, Inc. (NYSE:JNPR) by 376% in Q3 to end the quarter with a position worth 0.65% of the fund’s 13F equity portfolio. Thanks to the broader market rally, shares of the leading network products and services company have rallied from $26.12 at the end of September to $31.57 on November 18. Juniper Networks, Inc. also has a dividend yield of 2.66%. In terms of its preliminary Q3 results, Juniper Networks, Inc. earned an adjusted EPS of $0.58 on sales of $1.415 billion versus the estimated $0.50 and $1.35 billion.
Given Point72 Asset Management’s stake, Juniper Networks, Inc. ranks #7 on our list of Billionaire Steve Cohen’s Top 10 Dividend Stocks.
6. Oracle Corporation (NASDAQ:ORCL)
Point72 Asset Management’s Stake Value as of 9/30: $183,651,000
Percentage of Point72 Asset Management’s 13F Portfolio as of 9/30: 0.73%
Dividend Yield as of 11/18: 1.61%
Point72 Asset Management more than doubled its position in Oracle Corporation (NASDAQ:ORCL) in the third quarter to end September with a stake value of over $183 million. Although Oracle Corporation shares are down around 8.6% year to date, Brad Zelnick of Deutsche Bank raised his price target to $120 from $110 and kept a ‘Buy’ rating citing growth prospects from the company’s public cloud. Oracle Corporation has a dividend yield of 1.61%.
Like Oracle Corporation, Microsoft Corporation, Fidelity National Information Services, Inc., and AstraZeneca plc (NASDAQ:AZN) are among billionaire Steve Cohen’s Point72 Asset Management’s top dividend stocks at the end of Q3 2022.
5. Analog Devices, Inc. (NASDAQ:ADI)
Point72 Asset Management’s Stake Value as of 9/30: $198,235,000
Percentage of Point72 Asset Management’s 13F Portfolio as of 9/30: 0.79%
Dividend Yield as of 11/18: 1.88%
Point72 Asset Management increased its position in integrated circuits maker Analog Devices, Inc. (NASDAQ:ADI) by 149% in Q3 to end the quarter with a position worth almost $200 million. Although the semiconductor industry has experienced headwinds in 2022, Analog Devices, Inc. hasn’t fallen as much as some other big semiconductor stocks with shares down only 7.9% year to date. Analog Devices, Inc. also has a dividend yield of 1.88% as of 11/18.
4. Visa Inc. (NYSE:V)
Point72 Asset Management’s Stake Value as of 9/30: $204,948,000
Percentage of Point72 Asset Management’s 13F Portfolio as of 9/30: 0.81%
Dividend Yield as of 11/18: 0.85%
Payments giant Visa Inc. (NYSE:V) was one of the rare top stocks that Point72 Asset Management trimmed in Q3. In the September quarter, billionaire Steve Cohen’s fund cut its position in Visa Inc. by 17% to end the third quarter with a stake of around $205 million. Visa Inc. has a dividend yield of 0.85% and is down 2.7% year to date.
Baron Funds commented on Visa Inc. in its Q3 2022 investor letter,
“Shares of global payment network Visa Inc. fell despite reporting financial results that beat Street forecasts and sustained volume growth in recent months. Revenue grew 19% and EPS grew 33% in the most recent quarter, and double-digit payment volume growth persisted through August. Share price weakness represented a reversal of outperformance earlier this year and may be due to foreign exchange headwinds and concerns about a potential weakening of consumer spending. We continue to own the stock due to Visa’s long runway for growth and significant competitive advantages.”
3. Microsoft Corporation (NASDAQ:MSFT)
Point72 Asset Management’s Stake Value as of 9/30: $222,971,000
Percentage of Point72 Asset Management’s 13F Portfolio as of 9/30: 0.89%
Dividend Yield as of 11/18: 1.13%
Billionaire Steve Cohen’s fund raised its position in software giant Microsoft Corporation by 148% to make the stock a top 10 position at the end of Q3. Like other big tech stocks in 2022, Microsoft Corporation hasn’t done very well this year with its stock down 28.3% year to date. Nevertheless, Microsoft Corporation has multiple strong businesses in the cloud, enterprise, and operating systems and the company also has a dividend yield of 1.13% as of 11/18.
2. Fidelity National Information Services, Inc. (NYSE:FIS)
Point72 Asset Management’s Stake Value as of 9/30: $251,727,000
Percentage of Point72 Asset Management’s 13F Portfolio as of 9/30: 1%
Dividend Yield as of 11/18: 3.06%
Although the fintech stock hasn’t done well this year, Point72 Asset Management nevertheless has a substantial stake in Fidelity National Information Services, Inc. according to 13F filings. As of September 30, billionaire Steve Cohen’s fund had a position worth over $251 million that accounted for 1% of the fund’s total 13F portfolio.
For Q3, Fidelity National Information Services, Inc. earned $1.74 per share on revenue of $3.6 billion versus estimates of $1.75 per share and sales of $3.61 billion. For the fourth quarter, the company has an outlook for EPS of $1.66-$1.72 versus estimates of $2.07. Given the weak results and lower than expected guidance, Fidelity National Information Services, Inc. fell to a 52 week low after the Q3 report as a result.
Given the stock’s 43.7% year to date decline, Fidelity National Information Services, Inc. has a forward P/E ratio of 9 and a dividend yield of 3.06% as of 11/18.
With Point72 Asset Management’s stake, Fidelity National Information Services, Inc. ranks #2 on our list of Billionaire Steve Cohen’s Top 10 Dividend Stocks.
1. AstraZeneca plc (NASDAQ:AZN)
Point72 Asset Management’s Stake Value as of 9/30: $263,871,000
Percentage of Point72 Asset Management’s 13F Portfolio as of 9/30: 1.05%
Dividend Yield as of 11/18: 2.92%
With a stake value of over $263 million at the end of September, AstraZeneca plc (NASDAQ:AZN) is one of Point72 Asset Management’s top holdings for Q3.
During the quarter, billionaire Steve Cohen’s fund increased its stake in pharmaceutical giant AstraZeneca plc (NASDAQ:AZN) by 145% to end the quarter with the stock account for 1.05% of the fund’s 13F portfolio. Despite the broader market weakness, AstraZeneca plc (NASDAQ:AZN) shares are up 11.7% year to date as investors expect the company’s earnings per share to increase in the medium term. According to Barron’s, analysts expect AstraZeneca plc (NASDAQ:AZN) to earn $3.31 per share for 2022, $3.69 per share in 2023 and $4.37 per share in 2024. If AstraZeneca plc (NASDAQ:AZN)’s EPS increases as expected, the company’s quarterly dividend of $0.48 per share could increase as well.
Given Point72 Asset Management’s position, AstraZeneca plc (NASDAQ:AZN) ranks #1 on our list of Billionaire Steve Cohen’s Top 10 Dividend Stocks.
You can also take a look at 15 Biggest IT Companies in the World and 15 Biggest Insurance Companies in the World.
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This article is originally published at Insider Monkey.
