Top 5 Dividend Stocks To Buy According To Hedge Funds

In this article, we discuss 5 top dividend stocks to buy according to hedge funds. If you want to read our detailed analysis of dividend stocks and their performance, go directly to read Top 15 Dividend Stocks To Buy According To Hedge Funds. 

5. UnitedHealth Group Incorporated (NYSE:UNH)

Number of Hedge Fund Holders: 110

UnitedHealth Group Incorporated (NYSE:UNH) is an American multinational healthcare and insurance company. In November, Morgan Stanley assumed its coverage on the stock with an Overweight rating and a $587 price target, calling the company the largest national insurer. The firm also appreciated the company’s market share in the insurance sector.

In the third quarter of 2022, reported an operating cash flow of $18.5 billion and its adjusted free cash flow stood at $8.8 billion. The company remained committed to its shareholder obligation in the first nine months of the year, returning $10.5 billion to shareholders through dividends and share repurchases. This places the company as one of the best dividend stocks on our list.

UnitedHealth Group Incorporated (NYSE:UNH) currently pays a quarterly dividend of $1.65 per share. The company has been paying regular dividends to shareholders since 1990. As of November 29, the stock has a dividend yield of 1.25%.

The number of hedge funds tracked by Insider Monkey owning stakes in UnitedHealth Group Incorporated (NYSE:UNH) jumped to 110 in Q3 2022, from 91 in the previous quarter. The stakes owned by these hedge funds have a total value of over $10.3 billion.

Aristotle Atlantic Partners, LLC mentioned UnitedHealth Group Incorporated (NYSE:UNH) in its Q3 2022 investor letter. Here is what the firm has to say:

“UnitedHealth Group Incorporated (NYSE:UNH) is a leading U.S. health insurer offering a variety of plans and services to group and individual customers nationwide. Its health benefits segment manages health maintenance organization, preferred provider organization and point-of-service plans, as well as Medicare, Medicaid, state-funded, and supplemental vision and dental options. In addition, UnitedHealth Group’s Optum health services units—OptumHealth, OptumInsight and OptumRx—provide wellness and care management programs, financial services, information technology solutions, and pharmacy benefit management services to individuals and the health care industry. We believe UnitedHealth Group is well-positioned as a leader in commercial and government insurance markets with a broad complimentary service offering through Optum Health. As one of the largest health care payers and providers, we believe the company has unique insights and scale to continue to evolve the health care delivery process and drive above industry profitability and growth. We believe UnitedHealth Group’s track record of financial strength and stability warrants a premium in share valuation.”

4. Apple Inc. (NASDAQ:AAPL)

Number of Hedge Fund Holders: 140

Apple Inc. (NASDAQ:AAPL) was a part of 140 hedge fund portfolios in Q3 2022, growing from 128 in the previous quarter. The collective value of stakes owned by these hedge funds is over $144 billion.

In fiscal Q4 2022, Apple Inc. (NASDAQ:AAPL) reported revenue of $90.1 billion, which showed an 8.1% growth from the same period last year. The company’s cash flow also remained strong during the quarter as it paid $29 billion to shareholders in dividends and share repurchases. It had over $23.6 billion available in cash and cash equivalents at the end of the quarter.

On October 27, Apple Inc. (NASDAQ:AAPL) declared a quarterly dividend of $0.23 per share, which fell in line with its previous dividend. The company is one of the best dividend stocks on our list as it has raised its payouts consistently for the past nine years. The stock’s dividend yield on November 29 came in at 0.65%.

Evercore ISI lifted its price target on Apple Inc. (NASDAQ:AAPL) to $190 in November with an Outperform rating on the shares. The firm expects strong iPhone 14 revenues due to the company’s consistent customer base.

Wedgewood Partners mentioned Apple Inc. (NASDAQ:AAPL) in its Q3 2022 investor letter. Here is what the firm has to say:

“Apple Inc. (NASDAQ:AAPL) grew revenues +5% (foreign exchange adjusted and excluding Russia) driven by record iPhone revenues that were up about +3% on an exceptional year ago comparison of +50%. Apple’s installed base is over 1.8 billion devices which helps drive a software and services business that has generated almost $80 billion of revenue over the past 4 quarters. As we have highlighted in the past, Apple’s relentless focus on the development and integration between hardware (especially ICs) as well as software, continues to add significant value for customers of its products and services. We expect this favorable competitive dynamic to continue for the foreseeable future.”

3. Mastercard Incorporated (NYSE:MA)

Number of Hedge Fund Holders: 146

Mastercard Incorporated (NYSE:MA) is a multinational financial services company that provides a wide range of credit cards and other financial services to its consumers. In Q3 2022, the company had $7.6 billion in cash and cash equivalents, compared with $7.4 billion nine months ago. It paid $474 million to shareholders in dividends during the quarter, which makes it one of the best dividend stocks to buy.

Mastercard Incorporated’s (NYSE:MA) strong quarterly results were noticed by Street analysts. Mizuho maintained a Buy rating on the stock in November with a $380 price target. The firm also raised its estimates for the company for FY22.

Mastercard Incorporated (NYSE:MA) currently pays a quarterly dividend of $0.49 per share. The company has been raising its dividends consistently for the past nine years. As of November 29, the stock has a dividend yield of 0.57%.

Mastercard Incorporated (NYSE:MA) saw significant growth in hedge fund positions in Q3 2022, as 146 funds tracked by Insider Monkey had stakes in the company, up from 137 in the previous quarter. These stakes have a total value of over $13.8 billion. Akre Capital Management was the company’s leading stakeholder in Q3.

Baron Funds mentioned Mastercard Incorporated (NYSE:MA) in its Q3 2022 investor letter. Here is what the firm has to say:

“Shares of global payment network Mastercard Incorporated (NYSE:MA) fell despite reporting financial results that exceeded Street estimates. Revenue grew 21% and EPS grew 32% in the most recent reported quarter, and strong payment activity has persisted despite high inflation. Share price weakness represented a reversal of outperformance earlier this year and was likely driven by adverse foreign exchange movements and concerns about a potential weakening of consumer spending. We retain conviction due to Mastercard’s long runway for growth and significant competitive advantages.”

2. Visa Inc. (NYSE:V)

Number of Hedge Fund Holders: 165

Visa Inc. (NYSE:V) is a California-based multinational financial services company. In November, Baird maintained an Outperform rating on the stock with a $250 price target, appreciating the company’s operating metrics and its overall fundamentals.

On October 25, Visa Inc. (NYSE:V) announced a 20% growth in its quarterly dividend to $0.45 per share. This marked the company’s 14th consecutive year of dividend growth, which makes it one of the best dividend stocks on our list. As of November 29, the stock has a dividend yield of 0.86%.

At the end of Q3 2022, 165 hedge funds in Insider Monkey’s database owned stakes in Visa Inc. (NYSE:V), compared with 166 in the previous quarter. These stakes are worth over $22.4 billion collectively.

Baron Funds mentioned Visa Inc. (NYSE:V) in its Q3 2022 investor letter. Here is what the firm has to say:

“Shares of global payment network Visa Inc. (NYSE:V) 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.”

1. Microsoft Corporation (NASDAQ:MSFT)

Number of Hedge Fund Holders: 269

Microsoft Corporation (NASDAQ:MSFT) raised its dividend for the 16th consecutive year in 2022. The company pays a quarterly dividend of $0.68 per share and has a dividend yield of 1.13%, as of November 29.

RBC Capital maintained an Outperform rating on Microsoft Corporation (NASDAQ:MSFT) in October with a $310 price target, appreciating the company’s fiscal Q1 2023 results. The firm also highlighted the company’s management and its execution.

Microsoft Corporation (NASDAQ:MSFT) was included in 269 hedge fund portfolios in Q3 2022, up from 258 in the previous quarter, as per Insider Monkey’s database. The collective value of these stakes is over $61.1 billion.

Diamond Hill Capital mentioned Microsoft Corporation (NASDAQ:MSFT) in its Q3 2022 investor letter. Here is what the firm has to say:

“Also among our bottom contributors were media and technology giant Alphabet, software and IT services provider Microsoft Corporation (NASDAQ:MSFT) and insurance company American International Group (AIG). Microsoft shares declined in Q3, along with other tech companies, as rising interest rates impacted the near-term outlook. We expect the business to continue to generate strong revenue growth and benefit from operating leverage. Microsoft’s cloud computing services business, Azure, is generating robust growth, confirming its competitive positioning.”

You can also take a look at 11 Best Canadian Dividend Stocks To Buy Now and 10 Best 5% Dividend Stocks To Buy According To Hedge Funds

Follow Insider Monkey on Twitter