In this article we discuss the 10 best cheap dividend stocks to buy according to Mario Gabelli. If you want to skip our detailed analysis of Gabelli‘s history, and hedge fund performance, go directly to the 5 Best Cheap Dividend Stocks to Buy According to Mario Gabelli.
Mario Gabelli, nicknamed ‘Super Mario’ for his investment exploits as the chief of New York-based GAMCO Investors, has a three-year annualized average return of 4.4% and manages more than $11 billion in assets, falling into an elite category of the top 1% of hedge fund managers with a consistently positive return history. Gabelli oversees an incredibly diverse investment portfolio with stakes in the services, consumer goods, and financial sectors, among many others. His focus is on value investing, though he owns many high growth stock options.
Some of the most high profile names that GAMCO Investors is bullish on include The Walt Disney Company (NYSE: DIS), Facebook, Inc. (NASDAQ: FB), and Bank of America Corporation (NYSE: BAC). Regulatory filings reveal that GAMCO owned 548,827 shares in The Walt Disney Company (NYSE: DIS) at the end of March, worth over $101 million. Although Gabellil has trimmed his stake in the entertainment company by 4%, it still represents 0.88% of the investment portfolio of GAMCO Investors.
Amid a broader lull in the market around technology stocks, GAMCO has also trimmed their stakes in Facebook, Inc. (NASDAQ: FB) by 12%, latest documents reveal. The hedge fund now owns 44,092 shares in the technology company worth close to $13 million, representing 0.11% of their total holdings. It is also a little surprising that there has been little activity around Bank of America Corporation (NYSE: BAC) stock by GAMCO over the past few months, since the financial services sector comprises over 16% of the total portfolio of the hedge fund.
GAMCO owned more than 1.3 million shares of Bank of America Corporation (NYSE: BAC) worth over $53 million at the end of March. Gabelli has gained importance in recent weeks amid increased interest around value stocks because of inflation worries and price volatility surrounding growth stocks. As a veteran value investor, the top holdings of Gabelli can teach a lot about the market to retail investors who have been increasingly active in the finance world as fintech companies fundamentally alter the traditional dynamics of the marketplace.
The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
With this context in mind, here is our list of the 10 best cheap dividend stocks to buy according to Mario Gabelli.
Best Cheap Dividend Stocks to Buy According to Mario Gabelli
10. Grupo Televisa, S.A.B. (NYSE: TV)
Number of Hedge Fund Holders: 15
Dividend Yield: 0.68%
Grupo Televisa, S.A.B. (NYSE: TV) is a Mexico City-based media firm. It was founded in 1973 and is placed tenth on our list of 10 best cheap dividend stocks to buy according to Mario Gabelli. Grupo stock has returned more than 124% to investors over the past year. GAMCO Investors owns over 4.7 million shares in the firm that are worth more than $41 million, representing 0.36% of their investment portfolio. GAMCO has increased activity on Grupo stock by 34% since December 2020.
On May 26, Grupo Televisa, S.A.B. (NYSE: TV) declared a dividend of $0.078 per share, payable to shareholders in early June. The company has an impressive dividend history stretching back almost two decades.
At the end of the first quarter of 2021, 15 hedge funds in the database of Insider Monkey held stakes worth $752 million in Grupo Televisa, S.A.B. (NYSE: TV), down from 20 in the preceding quarter worth $692 million.
Just like The Walt Disney Company (NYSE: DIS), Facebook, Inc. (NASDAQ: FB), and Bank of America Corporation (NYSE: BAC), Grupo Televisa, S.A.B. (NYSE: TV) is one of the best stocks to buy according to Mario Gabelli.
9. CNH Industrial N.V. (NYSE: CNHI)
Number of Hedge Fund Holders: 23
Dividend Yield: 0.77%
CNH Industrial N.V. (NYSE: CNHI) is a United Kingdom-based firm that manufactures agricultural tractors and other heavy equipment. It was founded in 2012 and is ranked ninth on our list of 10 best cheap dividend stocks to buy according to Mario Gabelli. CNH stock has offered investors returns exceeding 180% over the past year. The hedge fund run by Gabelli owns over 9.9 million shares in the equipment manufacturing firm that are worth over $154 million, representing 1.35% of their portfolio.
On May 5, CNH Industrial N.V. (NYSE: CNHI) posted earnings per share of $0.32 for the first three months of 2021, beating market predictions by $0.18. The revenue over the period was over $7 billion, up more than 40% year-on-year.
Out of the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Harris Associates is a leading shareholder in CNH Industrial N.V. (NYSE: CNHI) with 149 million shares worth more than $2.3 billion.
In its Q1 2021 investor letter, Longleaf Partners Fund, an asset management firm, highlighted a few stocks and CNH Industrial N.V. (NYSE: CNHI) was one of them. Here is what the fund said:
“CNH Industrial (CNH) (23%, 1.19%), one of the world’s largest agriculture machinery manufacturers, was another top contributor. CNH reported strong fourth quarter results, beating the consensus on every metric. The Agricultural Equipment (Ag) business, which represents the majority of our value, posted strong top-line growth of 19% YoY thanks to rising commodity prices, growing trade with China and the replacement of aging machinery fleets. Visibility for the first half of 2021 is strong, given solid Ag order growth across most key end markets, and we expect to see operational turnarounds in CNH’s other businesses. The company is also guiding 8-12% industrial sales growth for 2021, which is better than our initial expectation. The most positive surprise for the quarter was the company’s strong cash generation. CNH generated approximately $2.4bn FCF in the fourth quarter alone, driven by working capital release leading to a strong net cash position for the industrial segment. Due to the recent stock price appreciation, the price-to-value gap has narrowed, but we continue to have a positive view given a more favorable market outlook, the company’s strong execution capability and management’s continued commitments to value accretive transactions, including the planned splitting of the business and potentially other strategic asset sales.”
8. Sirius XM Holdings Inc. (NASDAQ: SIRI)
Number of Hedge Fund Holders: 24
Dividend Yield: 0.94%
Sirius XM Holdings Inc. (NASDAQ: SIRI) is a New York-based radio broadcasting firm founded in 2008. It is placed eighth on our list of 10 best cheap dividend stocks to buy according to Mario Gabelli. The company stock has returned over 7.3% to investors in the past year. GAMCO Investors owns over 1.1 million shares in the firm that are worth more than $7.1 million, representing 0.06% of their portfolio. GAMCO has trimmed their holdings in the broadcasting firm by 8% since December 2020.
Sirius XM Holdings Inc. (NASDAQ: SIRI), on April 20, declared a quarterly dividend of $0.0146 per share, in line with previous. The earnings per share for the company in the first quarter of 2021 was $0.07, beating market estimates by $0.01.
Out of the hedge funds being tracked by Insider Monkey, Nebraska-based investment firm Berkshire Hathaway is a leading shareholder in Sirius XM Holdings Inc. (NASDAQ: SIRI) with 43 million shares worth more than $265 million.
Just like The Walt Disney Company (NYSE: DIS), Facebook, Inc. (NASDAQ: FB), and Bank of America Corporation (NYSE: BAC), Sirius XM Holdings Inc. (NASDAQ: SIRI) is one of the best stocks to buy according to Mario Gabelli.
7. Mueller Water Products, Inc. (NYSE: MWA)
Number of Hedge Fund Holders: 20
Dividend Yield: 1.52%
Mueller Water Products, Inc. (NYSE: MWA) is a Atlanta-based infrastructure firm founded in 1857. It is placed seventh on our list of 10 best cheap dividend stocks to buy according to Mario Gabelli. The company stock has returned over 53% to investors over the past twelve months. GAMCO Investors owns over 4.1 million shares in the firm worth over $57 million, representing 0.5% of their investment portfolio. The company primarily markets water-related products like hydrants and gate valves.
Mueller Water Products, Inc. (NYSE: MWA) has an impressive dividend history, offering shareholders healthy and regular payouts. On April 23, the firm declared a quarterly dividend of $0.055 per share, in line with previous.
At the end of the first quarter of 2021, 20 hedge funds in the database of Insider Monkey held stakes worth $288 million in Mueller Water Products, Inc. (NYSE: MWA), the same as in the preceding quarter worth $270 million.
6. TEGNA Inc. (NYSE: TGNA)
Number of Hedge Fund Holders: 20
Dividend Yield: 1.96%
TEGNA Inc. (NYSE: TGNA) is a Virginia-based media firm concentrating on the digital medium. It was founded in 2017 and is ranked sixth on our list of 10 best cheap dividend stocks to buy according to Mario Gabelli. The stock has returned more than 65% to investors in the past year. GAMCO Investors owns 549,300 shares in the firm that are worth over $10.3 million, representing 0.09% of their portfolio. GAMCO stake in the Virginian firm has been trimmed by 43% since last year.
On April 16, TEGNA Inc. (NYSE: TGNA) stock was given an Overweight rating by investment bank Wells Fargo with a price target of $23, implying an upside potential of 7.4% following solid preliminary earnings figures posted by the firm for the first quarter of 2021.
At the end of the first quarter of 2021, 20 hedge funds in the database of Insider Monkey held stakes worth $334 million in TEGNA Inc. (NYSE: TGNA), down from 34 in the preceding quarter worth $286 million.
Just like The Walt Disney Company (NYSE: DIS), Facebook, Inc. (NASDAQ: FB), and Bank of America Corporation (NYSE: BAC), TEGNA Inc. (NYSE: TGNA) is one of the best stocks to buy according to Mario Gabelli.
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Disclosure: None. 10 Best Cheap Dividend Stocks to Buy According to Mario Gabelli is originally published on Insider Monkey.
