In this article, we discuss 5 best stocks to consider for living off of dividends in retirement. If you want to see more dividend stocks in this selection, click Living Off Dividends in Retirement: 10 Best Stocks To Consider.
5. Apple Inc. (NASDAQ:AAPL)
Dividend Yield as of May 13: 0.63%
Number of Hedge Fund Holders: 134
Apple Inc. (NASDAQ:AAPL) is not only a dividend payer but the stock also offers strong growth prospects for the future in terms of share price gains. Investors tend to flock towards solid businesses like Apple Inc. (NASDAQ:AAPL) for retirement, since their performance remains consistent even amid turbulent market backdrops. Apple Inc. (NASDAQ:AAPL) reported its Q1 2022 results on April 28, which came in above consensus. The company announced earnings per share of $1.52 and a revenue of $97.28 billion, above market forecasts by $0.09 and $3.29 billion, respectively.
Apple Inc. (NASDAQ:AAPL) declared on April 28 a $0.23 per share quarterly dividend, a 4.5% increase from its prior dividend of $0.22. The dividend was distributed on May 12. The board of directors also authorized an increase of $90 billion to Apple Inc. (NASDAQ:AAPL)’s current share repurchase program.
On May 3, Morgan Stanley analyst Katy Huberty maintained an Overweight rating and a $195 price target on Apple Inc. (NASDAQ:AAPL) shares. The analyst said that Apple Inc. (NASDAQ:AAPL)’s estimated App Store net revenue growth accelerated to 8% year-over-year in April from the 6% growth in March. The analyst’s June quarter growth forecast of 15% year-over-year for App Store remains unchanged.
According to Insider Monkey’s fourth quarter database, 134 hedge funds held long positions in Apple Inc. (NASDAQ:AAPL), compared to 120 funds in Q3 2021. At the end of the first fiscal quarter of 2022, Ken Fisher’s Fisher Asset Management reported a prominent stake in the company, with almost 64 million shares worth over $11 billion.
Here is what Berkshire Hathaway has to say about Apple Inc. (NASDAQ:AAPL) in its Q4 2021 investor letter:
“Apple Inc. (NASDAQ:AAPL) – our runner-up Giant as measured by its year end market value – is a different sort of holding. Here, our ownership is a mere 5.55%, up from 5.39% a year earlier. That increase sounds like small potatoes. But consider that each 0.1% of Apple’s 2021 earnings amounted to $100 million. We spent no Berkshire funds to gain our accretion. Apple’s repurchases did the job. It’s important to understand that only dividends from Apple are counted in the GAAP earnings Berkshire reports – and last year, Apple paid us $785 million of those. Yet our “share” of Apple’s earnings amounted to a staggering $5.6 billion. Much of what the company retained was used to repurchase Apple shares, an act we applaud. Tim Cook, Apple’s brilliant CEO, quite properly regards users of Apple products as his first love, but all of his other constituencies benefit from Tim’s managerial touch as well.”
4. Wells Fargo & Company (NYSE:WFC)
Dividend Yield as of May 13: 2.35%
Number of Hedge Fund Holders: 94
Headquartered in San Francisco, California, Wells Fargo & Company (NYSE:WFC) operates as a diversified financial services company, specializing in banking, investment, mortgage, and consumer and commercial finance products. Wells Fargo & Company (NYSE:WFC) reported Q1 earnings per share of $0.88 on April 14, outperforming market estimates by $0.07.
Wells Fargo & Company (NYSE:WFC) declared on April 26 a $0.25 per share quarterly dividend, in line with previous. The dividend is distributable on June 1, to shareholders of the company as of May 6. On May 13, Wells Fargo & Company (NYSE:WFC) delivered a dividend yield of 2.35%.
On April 18, Barclays analyst Jason Goldberg reiterated an Overweight rating on Wells Fargo & Company (NYSE:WFC) and raised the firm’s price target on the stock to $64 from $62 after the Q1 results were posted. According to the analyst, Wells Fargo & Company (NYSE:WFC) increased its 2022 net interest income and loan growth outlook, while maintaining its expense forecast despite Q1 coming in higher than expected.
According to Insider Monkey’s Q4 data, 94 hedge funds reported owning stakes in Wells Fargo & Company (NYSE:WFC), compared to 88 funds in the last quarter. In the first quarter of 2022, Pzena Investment Management was a notable shareholder of the company, who reported owning 9.2 million shares worth $857 million.
Here is what Davis Opportunity Fund has to say about Wells Fargo & Company (NYSE:WFC) in its Q4 2021 investor letter:
“The absolute level of revenues and profits generated by such companies is in fact so large that most of the major financial holdings in the portfolio produce enough annual operating income individually that a number of them could, in theory, purchase several entire businesses among hundreds of choices within the S&P 1500 Index, using just a year’s cash earnings without dipping into capital. This is theoretical, as financial companies would not be in the business of buying healthcare or technology companies, for example, but we point out these facts to illustrate the sheer scale of the economics produced by single financial companies in a given year, which is often a multiple of the cash earnings yielded by companies in a host of other industries.
Given this cash-generation power, we are naturally drawn to what we believe are strong and profitable financial institutions when the price is right. Presently, we believe the valuations of our financial holdings are not only reasonable, but extremely compelling, and our portfolio composition reflects this view. Representative financial holdings in the Fund include Wells Fargo.”
3. Suncor Energy Inc. (NYSE:SU)
Dividend Yield as of May 13: 3.98%
Number of Hedge Fund Holders: 33
Suncor Energy Inc. (NYSE:SU) is a Canadian energy company that operates via Oil Sands, Exploration and Production, Refining and Marketing, and Corporate and Eliminations segments. Suncor Energy Inc. (NYSE:SU)’s dividend yield on May 13 came in at 3.98%.
On May 10, Suncor Energy Inc. (NYSE:SU) declared a C$0.47 per share quarterly dividend, an 11.9% increase from its earlier dividend of C$0.42. The dividend is payable on June 24, to shareholders of record on June 3. The company authorized an extension to the normal course issuer bid program to raise the maximum number of common shares. Suncor Energy Inc. (NYSE:SU) may repurchase up to approximately 10% of the public float as of January 31, 2022.
Suncor Energy Inc. (NYSE:SU) reported its financial results for the first fiscal quarter of 2022 on May 9. The company announced earnings per share of $1.48, beating market consensus estimates by $0.17. The revenue grew 47.54% year-over-year to $10.38 billion, topping analysts’ estimates by $1.59 billion.
BMO Capital analyst Randy Ollenberger on May 11 reiterated an Outperform rating on Suncor Energy Inc. (NYSE:SU) and raised the firm’s price target on the shares to C$54 from C$48.
According to Insider Monkey’s Q4 data, 33 hedge funds were bullish on Suncor Energy Inc. (NYSE:SU), up from 32 funds in the last quarter. In Q1 2022, Peter Rathjens, Bruce Clarke, and John Campbell’s Arrowstreet Capital disclosed a notable stake in Suncor Energy Inc. (NYSE:SU), comprising 16.8 million shares worth over $548 million.
Here is what ClearBridge Investments International Growth ADR Strategy has to say about Suncor Energy Inc. (NYSE:SU) in its Q1 2022 investor letter:
“Also within the structural bucket, we added to our commodity exposure with the purchase of Suncor Energy (NYSE:SU). Suncor, a past holding, is a Canadian integrated oil company where we capitalized on attractive valuation due to a COVID-19-induced slowdown. We expect recovery in oil demand and strong pricing will result in faster than expected free cash flow growth and financial deleveraging.
The structural bucket has the shortest investment horizon across the spectrum of growth companies we target in the Strategy. We closely monitor the macro impacts and turnaround progress of these companies and will be disciplined sellers when the thesis for a holding plays out.”
2. The Procter & Gamble Company (NYSE:PG)
Dividend Yield as of May 13: 2.38%
Number of Hedge Fund Holders: 67
The Procter & Gamble Company (NYSE:PG) is an American multinational branded consumer goods corporation, operating through Beauty, Grooming, Health Care, Fabric & Home Care, and Baby, Feminine & Family Care segments. 2022 marks the 66th consistent year that the company has raised its dividend and the 132nd consecutive year of dividend payments since its incorporation in 1890.
The Procter & Gamble Company (NYSE:PG) declared on April 12 a $0.9133 per share quarterly dividend, a 5% increase from its previous dividend of $0.8698. The dividend was paid to shareholders on May 16.
On April 22, Barclays analyst Lauren Lieberman raised the price target on The Procter & Gamble Company (NYSE:PG) to $176 from $167 and kept an Overweight rating on the shares. The analyst expects The Procter & Gamble Company (NYSE:PG)’s performance and results to “set an extremely high bar” for the industry and reinforce the company’s “widened fundamental performance gap”.
In Q4 2021, 67 hedge funds tracked by Insider Monkey reported owning bullish stakes in The Procter & Gamble Company (NYSE:PG), compared to 69 funds in the earlier quarter. At the end of the first fiscal quarter of 2022, Rajiv Jain’s GQG Partners held a significant position in the company, with approximately 10 million shares worth $1.5 billion.
1. The Sherwin-Williams Company (NYSE:SHW)
Dividend Yield as of May 13: 0.88%
Number of Hedge Fund Holders: 53
The Sherwin-Williams Company (NYSE:SHW) is an American seller of paints and coatings to professional, industrial, commercial, and retail customers. 2022 marks the 43rd consecutive year of dividend increases at the company. On April 20, The Sherwin-Williams Company (NYSE:SHW) declared a $0.60 per share quarterly dividend. The dividend is payable on June 3, to shareholders of the company as of May 20.
On April 26, The Sherwin-Williams Company (NYSE:SHW) reported its Q1 results, posting earnings per share of $1.61, beating market consensus by $0.08. The revenue of $5 billion outperformed analysts’ forecasts by $81 million.
RBC Capital analyst Arun Viswanathan on April 28 raised the price target on The Sherwin-Williams Company (NYSE:SHW) to $342 from $315 and maintained an Outperform rating on the shares. The analyst cited The Sherwin-Williams Company (NYSE:SHW)’s Q1 earnings beat, noting the improving availability of raw materials and guided inflation. The higher price target reflects the company’s pricing power, favorable volume outlook, and ability to repurchase shares to support the stock price, the analyst added.
According to Insider Monkey’s fourth quarter database, 53 hedge funds held long positions in The Sherwin-Williams Company (NYSE:SHW), up from 44 funds in Q3. At the end of the first quarter of 2022, billionaire Richard Chilton’s Chilton Investment Company revealed a prominent position in The Sherwin-Williams Company (NYSE:SHW), with 1.2 million shares worth more than $311 million.
You can also take a look at 10 Best Value ETFs to Invest in Now and 10 Best Undervalued Large-Cap Stocks According to Hedge Funds.
