Below you can find our list of the top 5 dividend paying stocks under $50 according to hedge funds. For our detailed discussion and a more comprehensive list please see 10 Best Dividend Paying Stocks To Buy Under $50.
5. Pfizer Inc. (NYSE: PFE)
Hedge Funds: 66
Total Hedge Fund Holdings: $2.12 billion
Dividend Yield: 3.70%
Price (at the time of writing): $41.12
Pfizer has been enjoying a lot of media attention recently, given it is one of the front-liners in the battle for developing and releasing a wide-use COVID vaccine. Has it been enjoying the same amount of interest from investors, though? Our data shows that hedge fund investor interest has been flat at 66 portfolios, same as in Q2.
However, Pfizer has recently announced positive results in its vaccine trials and has been making steps to start vaccination in multiple nations. Pfizer stock was one of the first buys of Warren Buffet’s Berkshire Hathaway for Q3. Berkshire bought 3.91 million PFE shares during Q3, building an ownership stake valued at over $136 million as of September 30.
4. Intel Corporation (NASDAQ: INTC)
Hedge Funds: 66
Total Hedge Fund Holdings: $4.34 billion
Dividend Yield: 2.65%
Price (at the time of writing): $49.73
Microchip & hardware tech giant Intel’s Q3 announcements outlined $25.5 billion cash from operations, $15.1 billion of free cash flow and paid dividends of $4.2 billion.
At Q3’s end, a total of 66 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -15% from the second quarter of 2020. Ken Fisher’s Fisher Asset Management currently holds the number one investor spot among hedge funds with $1.46 billion in share holdings.
3. Bank of America Corp (NYSE: BAC)
Hedge Funds: 88
Total Hedge Fund Holdings: 26.63
Dividend Yield: 2.52%
Price (at the time of writing): $28.57
Last month the Bank of America Corporation made it to our “10 Best Bank Stocks To Buy Right Now” list. BAC’s Q3 report states a net income of $4.9 billion, or $0.51 per diluted share. This beat the predictions which may have been lowered due to the credit panic that took over the stock market once the COVID pandemic hit.
2. Wells Fargo & Company (NYSE: WFC)
Hedge Funds: 90
Total Hedge Fund Holdings: $8.46 billion
Dividend Yield: 1.38%
Price (at the time of writing): $29.08
Even though Q3 saw WFC losing some interest by Warren Buffett’s fund, other hedge funds responded with greater interest. Even though it is not at its all time high, interest in Wells Fargo & Company enjoyed a slight increase in Q4, climbing to 90 from 84.
Buffett cut his stake in WFC by 46% during the third quarter but Berkshire Hathaway remains the larges shareholder among hedge funds. The second largest stake is held by Eagle Capital Management, led by Boykin Curry, holding a $1.1207 billion position; 4% of its 13F portfolio is allocated to the company.
1. Citigroup (NYSE:C)
Hedge Funds: 91
Total Hedge Fund Holdings: $5.5 billion
Dividend Yield: 3.5%
Price (at the time of writing): $58.93
Citigroup’s shares aren’t too far from $50 and we believe financial stocks offer some of the highest upside potentials in the market right now, so we made an exception. Financial stocks are definitely contrarian investments at the moment. If Citigroup’s stock price goes back to its 2020 high, Citigroup investors will generate more than 35% gains from these levels.
Generation PMCA talked about Citigroup in its Q3 investor letter. Here is what they said:
“Citigroup’s operations span more than 160 countries. Faced with record low interest rates, rising loss provisions, and subdued lending, the financial sector has been one of the worst performing groups year-to-date. However, earnings appear to have stabilized for the major banks. The company had its own internal issues too, having to pay significant fines for regulatory deficiencies. They are spending over $1 billion on compliance matters. With these issues being addressed and the company’s dominant network intact, it is well positioned to benefit from a global economic recovery. We have assumed a gradual recovery of earnings to former highs over the next few years. Return on tangible common equity should exceed 10% by 22, implying earnings per share above $8. While shares have risen recently, they still trade at only 6x our 2-year-out earnings estimate and yield just under 4%.”
Please also see 10 best dividend stocks to buy now and 15 best technology stocks to buy now.
Disclosure: None.
