In this article, we discuss the 5 best dividend stocks in Warren Buffett’s latest 13F portfolio. If you want to read our detailed analysis of Berkshire Hathaway’s past performance and Buffett’s investment strategies, be sure to read Warren Buffett’s Latest Portfolio: 10 Dividend Stock Picks.
5. AbbVie Inc. (NYSE:ABBV)
Number of Hedge Fund Holders: 82
Berkshire Hathaway’s Stake Value: $410,744,000
Dividend Yield as of February 21: 3.92%
On October 29, AbbVie Inc. (NYSE:ABBV), an American biopharmaceutical company, hiked its quarterly dividend by 9% to $1.41 per share, which yields 3.92% as of February 21. The company has raised its dividend by over 250% since its inception in 2013.
The number of hedge funds tracked by Insider Monkey holding stakes in AbbVie Inc. (NYSE:ABBV) inched up to 82 in Q4 from 81 in the previous quarter. These stakes hold a consolidated value of over $3.7 billion.
In February, JPMorgan praised AbbVie Inc. (NYSE:ABBV)’s Q4 results and its developments in immunology. The firm lifted its price target on the stock to $185, while maintaining an ‘Overweight’ rating on the shares. Warren Buffett started investing in AbbVie Inc. (NYSE:ABBV) during the third quarter of 2020. In Q4 2021, Berkshire Hathaway held stakes worth over $410.7 million after slashing its position in the company by 79%. AbbVie Inc. (NYSE:ABBV) accounted for 0.12% of Warren Buffett’s portfolio.
Miller Howard Investments mentioned AbbVie Inc. (NYSE:ABBV) in its Q3 2021 investor letter. Here is what the firm had to say:
“While optimistic about a recovery, we continue to balance our cyclical holdings with dividend-payers in stable, less economically-sensitive industries. We hold three pharmaceutical companies, (which includes) AbbVie (ABBV). All three have strong cash flows and balance sheets, making their high dividends reasonably safe. The investment controversy surrounding these pharma companies is whether they can develop or acquire new products to replace their current blockbuster drugs. The low valuations on these stocks reflects what we believe to be undue pessimism by investors on the prospects for new drugs.”
4. The Kraft Heinz Company (NASDAQ:KHC)
Number of Hedge Fund Holders: 39
Berkshire Hathaway’s Stake Value: $11,690,290,000
Dividend Yield as of February 21: 4.16%
Insider Monkey’s Q4 data shows that the hedge fund interest has spiked in The Kraft Heinz Company (NASDAQ:KHC), the American multinational food giant. As of Q4 2021, 39 hedge funds tracked by Insider Monkey held stakes in the company, up from 33 in the previous quarter. These stakes hold a consolidated value of over $12.2 billion.
Though The Kraft Heinz Company (NASDAQ:KHC) cut its dividend by 36% in 2019, the company has continued to pay dividends to shareholders over the years. Currently, it offers a quarterly dividend of $0.40 per share, which yields 4.16%. Since the beginning of the year, The Kraft Heinz Company (NASDAQ:KHC) delivered a 6.42% return to shareholders as of the close of February 20.
In Q4 2021, The Kraft Heinz Company (NASDAQ:KHC) was the fifth-largest holding of Berkshire Hathaway. Buffett’s holding company held over 325.6 million shares of KHC, valued at roughly $11.7 billion. The company made up 3.53% of Warren Buffett’s 13F portfolio value.
3. Chevron Corporation (NYSE:CVX)
Number of Hedge Fund Holders: 53
Berkshire Hathaway’s Stake Value: $4,488,055,000
Dividend Yield as of February 21: 4.26%
Chevron Corporation (NYSE:CVX) is an American multinational energy company that specializes in the exploration for, and production of, oil and natural gas. In Q4 2021, Berkshire Hathaway increased its position in the company by 34%, which accounted for 1.35% of Warren Buffett’s portfolio. The holding company held shares worth roughly $4.5 billion in Chevron Corporation (NYSE:CVX).
On January 26, Chevron Corporation (NYSE:CVX) raised its dividend by 6% to $1.42 per share. The stock’s current dividend yield stands at 4.26%, as recorded on February 21. Chevron Corporation (NYSE:CVX) has been increasing its annual dividend consecutively for the past 35 years. On February 9, Barclays lifted its price target on Chevron Corporation (NYSE:CVX) to $148, with an ‘Overweight’ rating on the shares.
At the end of Q4 2021, 53 hedge funds tracked by Insider Monkey reported owning stakes in Chevron Corporation (NYSE:CVX), valued at over $6.5 billion. In comparison, 51 hedge funds held positions in the company in the previous quarter, with stakes valued at over $4.44 billion. Fisher Asset Management was one of the company’s leading shareholders in Q4, owning stakes worth $774.2 million.
Goehring & Rozencwajg Associates mentioned Chevron Corporation (NYSE:CVX) in its Q3 2021 investor letter. Here is what the firm had to say:
“After successfully replacing 25% of Exxon’s board of directors despite owning just 0.02% of the outstanding equity, Engine No. 1, the climate-focused activist hedge fund, met with Chevron’s management late last summer. In discussions that were later described as “cordial,” Chevron executives shared their plan to reduce carbon emissions. Subsequently, Chevron announced new plans to further reduce carbon output, along with their intention to appoint a new director with “environmental expertise.” Although it remains unclear exactly what Engine No. 1 is planning, rumors suggest the fund has contacted other investors, strongly suggesting they intend to launch a second campaign in the not-too-distant future.
What should Chevron expect?
It was recently reported by The Wall Street Journal that Exxon was considering abandoning two massive natural gas projects: the 75 trillion cubic foot (tcf ) Rovuma LNG project (capital cost $30 bn) and the 5 tcf Ca Voi Xanh offshore-Vietnam gas project (capital cost $10 bn). Exxon board members (most likely including the three supported by Engine No. 1) have publically expressed concerns about both projects. According to internal reports, these projects are among the highest CO2 producers in Exxon’s pipeline; it is no surprise these projects have been called into question. However, we find the plight of both fields to be perplexing since production would almost certainly be used to displace coal in electricity generation, cutting CO2 emissions by nearly 50%. This fact seems to be lost on the new Exxon board members.”
2. Verizon Communications Inc. (NYSE:VZ)
Number of Hedge Fund Holders: 63
Berkshire Hathaway’s Stake Value: $8,252,525,000
Dividend Yield as of February 21: 4.76%
This January, Deutsche Bank raised its price target on Verizon Communications Inc. (NYSE:VZ), an American telecommunications company, to $59, and expected about 8% upside in the stock in 2022.
In 2021, Verizon Communications Inc. (NYSE:VZ) raised its quarterly dividend by 2% at $0.64 per share. The stock’s dividend yield stands at 4.76%. Verizon Communications Inc. (NYSE:VZ) maintains a 14-year track record of consistent dividend growth.
In Q4 2021, Berkshire Hathaway did not change its position in the company, holding shares worth over $8.2 billion. Verizon Communications Inc. (NYSE:VZ) represented 2.49% of Warren Buffett’s portfolio. As per Insider Monkey’s Q4 data, 63 hedge funds held stakes in Verizon Communications Inc. (NYSE:VZ), up from 57 in the previous quarter. These stakes are valued at $10.8 billion.
Weitz Investment Management mentioned Verizon Communications Inc. (NYSE:VZ) in its Q4 2021 investor letter. Here is what the firm had to say:
“After several quarters of pandemic-induced outsized growth, new broadband connection growth has slowed for U.S. cable operators. This slower growth has coincided with a renewed push by competitors like Verizon and AT&T to offer high-speed data (either via wireless connects or by building new fiber-optic networks).”
1. STORE Capital Corporation (NYSE:STOR)
Number of Hedge Fund Holders: 17
Berkshire Hathaway’s Stake Value: $839,882,000
Dividend Yield as of February 21: 5.05%
An American real estate investment trust, STORE Capital Corporation (NYSE:STOR) increased its quarterly dividend by 7% in 2021 to $0.385 per share. The stock’s dividend yield stands at 5.05% as of February 21. This January, Mizuho set a $33 price target on STORE Capital Corporation (NYSE:STOR), while keeping a ‘Neutral’ rating on the shares.
As of the end of Q4 2021, 17 hedge funds in Insider Monkey’s database reported owning stakes in STORE Capital Corporation (NYSE:STOR), up from 16 in the previous quarter. Those stakes held a value of over $906.3 million. Berkshire Hathaway accounted for most of that, holding shares worth roughly $840 million in STORE Capital Corporation (NYSE:STOR) at the end of 2021, which represented 0.25% of Warren Buffett’s portfolio.
Besides Berkshire Hathaway, Citadel Investment Group was one of the largest shareholders of the company in Q4, holding a stake worth over $41.6 million.
You can also take a look at 10 Healthy and Sustainable Food Stocks to Buy and 10 Best Bargain Stocks Right Now
