In this article, we will be taking a look at the top 5 high dividend stocks to buy according to hedge funds. If you want to see our detailed analysis of dividend investing, you can go directly to the Top 12 High Dividend Stocks To Buy According To Hedge Funds.
5. Enbridge Inc. (NYSE:ENB)
Number of Hedge Fund Holders: 19
Dividend Yield as of October 13: 6.29%
Enbridge Inc. (NYSE: ENB) is a multinational natural gas distribution company that operates through its Liquids Pipelines, Gas Transmission and Midstream, Gas Distribution and Storage, Renewable Power Generation, and Energy Services segments. Ranked fifth on our list of the top 12 high dividend stocks to buy according to hedge funds, Enbridge Inc. (NYSE:ENB) has a market capitalization of $106.09 billion.
On September 13, Goldman Sachs analyst Michael Lapides raised his price target on Enbridge Inc. (NYSE:ENB) to $34.56 from $32.95 and kept a Neutral rating on the shares of the company.
In the second quarter of 2021, Enbridge Inc. (NYSE: ENB) had an EPS of $0.54, beating estimates by $0.08. The company’s revenue was $8.77 billion, up 47.12% on a year-over-year basis, beating consensus estimates by $1.61 billion.
Of the 873 elite funds tracked by Insider Monkey, 19 were long in Enbridge Inc. (NYSE:ENB) at the end of June, compared to 22 in the first quarter of 2021. Joseph Sirdevan of Galibier Capital Management is the leading stakeholder of the company.
ClearBridge Investments, an investment management firm, mentioned Enbridge Inc. (NYSE: ENB) in its first-quarter 2021 investor letter. Here’s what they said:
“Enbridge owns and operates one of the largest oil and gas pipeline networks in North America. The company also owns regulated gas distribution utilities in Ontario, Canada. The first quarter saw the market giving the energy sector credit for its leverage to the eventual economic recovery as COVID-19 vaccines get rolled out through 2021.”
4. Plains GP Holdings, L.P (NASDAQ:PAGP)
Number of Hedge Fund Holders: 15
Dividend Yield as of October 13: 6.33%
Plains GP Holdings, L.P (NASDAQ:PABP) operates as a holding company, providing logistics services for crude oil and refined products, as well as operates energy infrastructure. The company has a market capitalization of $2.21 billion and is ranked fourth on our list of the top 12 high dividend stocks to buy according to hedge funds.
For the second quarter of 2021, Plains GP Holdings, L.P (NASDAQ:PAGP) reported earnings per share at $0.23, in line with market estimates. The company also reported revenues of $9.93 billion, surpassing estimates by $2.40 billion.
Morgan Stanley analyst Robert Kad remains bullish on Plains GP Holdings, L.P (NASDAQ:PAGP), upgrading the company to Overweight from Equal Weight with a $13 price target on its shares.
3. Plains All American Pipeline, L.P (NASDAQ:PAA)
Number of Hedge Fund Holders: 7
Dividend Yield as of October 13: 6.72%
Plains All American Pipeline, L.P. (NASDAQ:PAA) is an oil and gas company headquartered in Houston, Texas. Coming in at third on the list of the top 12 high dividend stocks to buy according to hedge funds, the company provides transportation and storage of crude oil and liquified petroleum gas with operations in US and Canada.
The company reported revenues of $9.93 billion in its earnings report for Q2 2021, which beat estimates by $3.20 billion. The EPS was reported to be $0.23, in-line with the estimates for the quarter.
Boston-based Arrowstreet Capital is one of the biggest stakeholders of Plains All American Pipeline, L.P (NASDAQ:PAA) as of the end of the second quarter, according to the data tracked by Insider Monkey. Overall, 7 funds were bullish on the company by the end of the June quarter.
Morgan Stanley analyst Robert Kad remains bullish on Plains All American Pipeline, L.P (NASDAQ:PAA), keeping an Overweight rating on the company alongside a $13 price target, implying a 34% return for the year.
2. Altria Group, Inc. (NYSE:MO)
Number of Hedge Fund Holders: 47
Dividend Yield as of October 13: 7.51%
Altria Group, Inc. (NYSE:MO) is one of the world’s largest producers and marketers of tobacco, cigarettes and related products. With worldwide operations, the company ranks second on our list of the top 12 high dividend stocks to buy according to hedge funds.
On September 30, Bank of America analyst Lisa Lewandowski maintained Buy ratings on Altria Group, Inc. (NASDAQ:MO), despite setbacks due to the ban of IQOS tobacco sticks.
In the second quarter of 2021, Altria Group, Inc. (NYSE: MO) had an EPS of $1.23, beating estimates by $0.06. The company’s revenue for the quarter was $5.61 billion, up 10.90% year-over-year, beating estimates by $250.80 million. Altria Group, Inc. (NYSE:MO) has gained 5.86% in the past 6 months and 23.90% year to date.
Out of the hedge funds being tracked by Insider Monkey, Chicago-based Harris Associates is a leading shareholder in Altria Group, Inc. (NYS:MO), with over 5.1 million shares worth more than $243.3 million.
In the Q2 2021 investor letter of Broyhill Asset Management, the fund mentioned Altria Group, Inc. (NYSE:MO). Here is what the fund had to say:
“Altria (MO) shook off the prospects of a ban on menthol and a potential cap on nicotine and gained 20%. We shared our thoughts on these regulations during the quarter, which are available here.
MO Valuation. MO is up ~ 18% YTD (even accounting for the recent sell-off). We expect MO to generate close to $5 in annual FCF per share over the next few years, putting the stock at ~ 10x, which is less than half the market’s multiple today. Over the last decade, shares have traded at an average multiple of 15x and within a range of ~ 10x – 20x (+/-1 standard deviation). The stock yields 7.2% at the current price, close to a 6% premium to treasuries. Historically, shares have traded closer to a 3% premium to the 10Y, which would imply a ~ $75 share price.”
1. AT&T Inc (NYSE:T)
Number of Hedge Fund Holders: 68
Dividend Yield as of October 13: 8.22%
Known as the largest telecommunications company in the world, as well as the largest provider of mobile telephone services in the United States, AT&T Inc (NYSE:T) is a multinational conglomerate holding company based in Texas. The firm ranks first on our list of the top 12 high dividend stocks to buy according to hedge funds.
On October 7, MoffettNathanson analyst Craig Moffett upgraded AT&T Inc (NYSE:T) to Neutral from Sell, with a price target of $28, up from $23.
By the end of the second quarter of 2021, 68 hedge funds out of the 873 tracked by Insider Monkey held stakes in AT&T Inc. (NYSE: T) worth roughly $2.9 billion. This is compared to 63 hedge funds in the previous quarter with a total stake value of approximately $2.7 billion.
Out of the hedge funds being tracked by Insider Monkey, Ken Griffins’ Citadel Investment Group is a leading shareholder in AT&T Inc. (NYSE:T), with over 32.75 million shares worth more than $942.6 million.
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