In this article, we have analyzed the list of 10 best dividend stocks under $15.
During the bull market driven by the “Magnificent Seven” stocks, dividend stocks lagged in performance. Since the beginning of 2024, the Dividend Aristocrats Index has increased by only 5.50%, while the Nasdaq has risen by 13.6%. That said, the performance of tech stocks becomes less significant when considering the long-term returns of dividend stocks. Dividend-paying stocks with strong balance sheets and stable yields can offer investors consistent income, protection against market declines, and steady growth for their investments.
When investing in dividend stocks, it might seem logical to invest in stocks with the highest yields. However, according to analysts, concentrating solely on yield may not be the most effective investment approach. Not all dividend yields are equally secure, as companies under financial strain may suspend or cut their dividend payments. Therefore, investors are encouraged to prioritize the sustainability of dividends and, if possible, seek out companies with a track record of dividend growth. To know more about strong dividend payers, have a look at Best Dividend Stocks of All Time.
Historically, companies that consistently grow their dividends have outperformed those that do not pay dividends, while also exhibiting less volatility. Although dividends are not guaranteed and can fluctuate, just like in today’s time, they have played a major role in equity total returns over the decades. From 1930 to 2023, dividends and their reinvestment accounted for 40% of the annualized total return of the broader market, with the remaining return coming from capital appreciation.
Companies globally are distributing record dividends to shareholders, largely due to their robust balance sheets. With companies holding near-record levels of cash and liquid assets, they are increasingly returning this cash to investors through dividends. Global dividends grew from $1.23 trillion in 2020 to $1.66 trillion in 2023, according to a report by Janus Henderson. The firm forecasts total dividends to reach $1.72 trillion for 2024, up 3.9% on a headline basis.
A company’s dividend payout ratio is an important measure of how flexible its dividend policy is. Firms that only earn enough to cover their dividends or pay out most of their earnings as dividends might face risks from competitive pressures, as their cash flow may not be adequate to sustain operations. Moreover, companies with high dividend yields or, more critically, high payout ratios might be at risk of limited future growth, which could impact both share price appreciation and the potential for increasing dividends. According to data collected by Nuveen, stocks with the highest payout ratios have not been the strongest long-term performers. Over the past 20 years, companies with medium and medium-high payout ratios that paid dividends have generally delivered better performance.
Consistently growing dividends is a challenging target, as it requires companies to be financially very stable. For companies that are still in the growth phase and have lower share prices, evaluating dividend sustainability becomes a straightforward metric to consider. In this article, we will take a look at some of the best dividend stocks under $15.
Photo by Viacheslav Bublyk on Unsplash
Our Methodology:
For this list, we used a Finviz stock screener to find dividend stocks trading below $15 as of the close of July 31. From the initial list, we narrowed down the selection to companies that pay regular dividends to shareholders and possess strong dividend policies, ensuring consistent future dividends. From the resultant list, we picked 10 stocks with the highest number of hedge fund investors, using Insider Monkey’s Q1 2024 database of 920 hedge funds and their holdings. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points. (see more details here).
10. Star Group, L.P. (NYSE:SGU)
Number of Hedge Fund Holders: 8
Share Price as of the Close of July 31: $11.06
Star Group, L.P. (NYSE:SGU) is an American company that specializes in providing residential and commercial heating oil, propane, and related services. In fiscal Q3 2024, the company reported strong results, benefitting from both increased volumes and improved per-gallon gross margins compared to the last year. In addition, the company also entered into a definitive agreement to acquire a high-quality fuel oil dealer for approximately $35 million, excluding working capital adjustments. This business, expected to provide nineteen million gallons of heating oil annually, is situated within the company’s existing operational area, with the transaction anticipated to close in the fourth quarter. During the quarter, it reported a 25.3% YoY growth in the volume of home heating oil and propane to 37.7 gallons.
Star Group, L.P. (NYSE:SGU)’s net attrition for the quarter remained stable and decreased slightly year-over-year, reflecting its ongoing commitment to excellent customer service and strategies to enhance retention rates. With investments in operations and personnel, the company looks forward to the arrival of winter in the coming months.
Star Group, L.P. (NYSE:SGU) has solid business fundamentals. However, investors should carefully assess the dividend situation. In the latest quarter, the company reported an operating cash flow of $77.5 million, down from $116.5 million in the same period last year. This doesn’t matter much when we consider its trailing twelve months (ttm) levered free cash flow of $65.8 million, notably better than Spire Inc.’s negative free cash flow of $254.5 million. Additionally, the company has increased its dividend payouts for 11 consecutive years. This indicates that it has maintained strong business performance even during challenging times, such as the pandemic, when many companies reduced their dividends due to business difficulties. On July 19, it declared a quarterly dividend of $0.1725 per share, which was in line with its previous dividend. With a dividend yield of 6.43% as of August 1, SGU is one of the best dividend stocks on our list.
At the end of Q1 2024, 8 hedge funds tracked by Insider Monkey reported having stakes in Star Group, L.P. (NYSE:SGU), the same as in the previous quarter. These stakes have a total value of over $47.5 million. With over 3.4 million shares, Bandera Partners was the company’s leading stakeholder in Q1.
9. FinVolution Group (NYSE:FINV)
Number of Hedge Fund Holders: 11
Share Price as of the Close of July 31: $5.58
FinVolution Group (NYSE:FINV) is a China-based fintech platform that offers a wide range of related services, including credit risk assessment, loan transactions, and fraud detection. The company benefits a lot from a continuous increase in its registered users in both Chinese and international markets. In the first quarter of 2024, the company declared a significant 49.7% growth in its registered users in international markets to 26.8 million. The company’s international markets continued to show strong growth, with transaction volume hitting RMB2.21 billion ($305.06 million), a 40.8% increase from the previous year. Additionally, the outstanding loan balance grew to RMB1.27 billion ($175.3 million), marking a 33.7% year-over-year rise. These figures highlight the company’s success in seizing opportunities across different countries.
As part of its dedication to delivering ongoing value to shareholders, FinVolution Group (NYSE:FINV) invested $27.2 million in the first quarter of 2024 to buy back shares on the secondary market. Since 2018, the company has returned a total of $632.2 million to shareholders through its capital return program, reflecting its sustained and reliable commitment to shareholder value. Since the start of 2024, the stock is up by over 11%.
FinVolution Group (NYSE:FINV), one of the best dividend stocks on our list, declared a 10.2% hike in its annual dividend to $0.237 per share. This was the company’s fourth consecutive year of dividend growth. The stock offers a dividend yield of 4.42%, as of August 1.
As of the end of Q1 2024, 11 hedge funds in Insider Monkey’s database owned stakes in FinVolution Group (NYSE:FINV), up from 10 in the previous quarter. The consolidated value of these stakes is over $28 million.
8. Barings BDC, Inc. (NYSE:BBDC)
Number of Hedge Fund Holders: 12
Share Price as of the Close of July 31: $10.03
Barings BDC, Inc. (NYSE:BBDC) is an American business development company that offers debt investments in middle-market companies. The company is distinguished as one of the leading business development companies in its sector, thanks to its knack for capitalizing on growth opportunities and delivering significant value to shareholders. Over the past year, it has surpassed many competitors and broader market indices, achieving an impressive total shareholder return of over 19%. This is especially notable given the company’s low-risk profile. Typically, high returns are associated with high-risk, high-beta stocks. In contrast, the company provides lower risk through its stable end markets, attractive dividends, and rising net asset value. Its five-year monthly beta of approximately 0.70 reflects its lower volatility compared to the overall market.
Barings BDC, Inc. (NYSE:BBDC) also gains significantly from the expanding business development sector. The BDC industry is experiencing rapid growth, with assets under management hitting a record $315 billion as of March 2024. Additionally, capital flow into BDCs remained strong throughout 2022 and early 2023, as investors rebalanced their portfolios. The company has been concentrating on growth opportunities to improve its portfolio value and increase net investment income. In the first quarter of 2024, the company invested $143 million in both new and existing companies. Its net investment income for the quarter was approximately $30 million. Moreover, the company reported nearly $70 million in revenues, marking a 4% increase from the same period last year.
Barings BDC, Inc. (NYSE:BBDC) made it to our list of the best dividend stocks under $15 as the company remains committed to its shareholder obligation, in addition to maintaining strong business fundamentals. The company has raised its payouts for five consecutive years in a row and offers a quarterly dividend of $0.26 per share. The stock offers an impressive dividend yield of 10.42% as of August 1. Its YoY quarterly base dividend growth comes in at 4%, compared with an industry’s mean of 3.1%.
Insider Monkey’s database of Q1 2024 indicated that 12 hedge funds owned stakes in Barings BDC, Inc. (NYSE:BBDC), which remained unchanged from the previous quarter. These stakes have a total value of more than $35.5 million. Among these hedge funds, Callodine Capital Management was the company’s leading stakeholder in Q1.
7. Krispy Kreme, Inc. (NYSE:DNUT)
Number of Hedge Fund Holders: 13
Share Price as of the Close of July 31: $10.03
Krispy Kreme, Inc. (NYSE:DNUT) ranks seventh on our list of the best dividend stocks under $15. The North Carolina-based company is one of the most popular donut chains in the world. The stock reached its peak for the year in March, trading at around $17 per share, following the company’s announcement of a groundbreaking partnership with McDonald’s. This collaboration is set to greatly expand the doughnut franchise’s reach, as there are approximately 13,500 McDonald’s locations in the U.S., compared to fewer than 400 Krispy Kreme, Inc. (NYSE:DNUT) outlets. Currently, the bakery’s donuts are also available through nearly 7,000 third-party locations. According to the deal, three classic Krispy Kreme donuts will gradually be offered at McDonald’s locations, with the goal of making them available across the entire store network by the end of 2026. In addition to this, the company also announced its expansion in Spain in 2025.
Krispy Kreme, Inc. (NYSE:DNUT) reported strong earnings in the first quarter of 2024. It posted a revenue of $442.7 million, which showed a 5.67% growth from the same period last year. The results surpassed expectations, fueled by higher digital sales and robust consumer demand. This was underscored by a record-setting Valentine’s Day, during which specialty doughnuts were offered in 33 countries worldwide. The company’s strategy of expanding the global availability of fresh Krispy Kreme donuts is yielding impressive results.
Krispy Kreme, Inc. (NYSE:DNUT) initiated its dividend policy in 2021 and has paid regular dividends to shareholders since then. The company offers a quarterly dividend of $0.035 per share and has a dividend yield of 1.35%, as of August 1.
The number of hedge funds holding stakes in Krispy Kreme, Inc. (NYSE:DNUT) jumped to 13 in Q1 2024, from 8 in the previous quarter, according to Insider Monkey’s database. The stakes owned by these hedge funds have a collective value of over $60.8 million.
6. Sirius XM Holdings Inc. (NASDAQ:SIRI)
Number of Hedge Fund Holders: 17
Share Price as of the Close of July 31: $3.45
Sirius XM Holdings Inc. (NASDAQ:SIRI) is an American broadcasting company that provides online radio and satellite radio services across the country. The company is currently facing difficulties due to the rising prominence of its competitors. Spotify, a global leader in digital music, recently reported an 18% increase in monthly active users in North America. In contrast, Sirius XM is struggling with its streaming platform, Pandora, which it acquired over five years ago. Pandora has seen a decline in subscribers, with self-pay subscribers for Pandora Plus and Pandora Premium dropping by 41,000 in the second quarter of 2024, ending the period with six million subscribers. Its overall revenue in Q2 also fell by 3% YoY at $3.18 billion. In addition to this, Sirius XM Holdings Inc. (NASDAQ:SIRI)’s own subscribers have fallen from 35 million in 2020 to 33 million in the most recent quarter.
That said, Sirius XM Holdings Inc. (NASDAQ:SIRI) is not in bad shape overall. It is actively pursuing acquisitions to navigate this difficult period. The company’s strategic investments in technology and automation are helping to lower costs, boost team efficiency, and improve the customer experience. The company anticipates completing the announced transaction with Liberty Media after the market closes on Monday, September 9th, and remains focused on achieving a long-term leverage ratio of mid-to-low three times adjusted EBITDA.
On July 24, Sirius XM Holdings Inc. (NASDAQ:SIRI) declared a quarterly dividend of $0.0266 per share, which was consistent with its previous dividend. The company maintains a seven-year streak of consistent dividend growth, which makes SIRI one of the best dividend stocks on our list. In the most recent quarter, the company returned $103 million to shareholders through dividends. The stock has a dividend yield of 3.43%, as of August 1.
According to Insider Monkey’s database of Q1 2024, 17 hedge funds owned stakes in Sirius XM Holdings Inc. (NASDAQ:SIRI), down from 22 in the previous quarter. These stakes have a total value of over $194.6 million. With nearly 37 million shares, Berkshire Hathaway was the company’s leading stakeholder in Q1.
5. Amcor plc (NYSE:AMCR)
Number of Hedge Fund Holders: 17
Share Price as of the Close of July 31: $10.53
A multinational global packaging company, Amcor plc (NYSE:AMCR) ranks fifth on our list of the best dividend stocks under $15. The company’s free cash flow has consistently been a strong point, which is favorable news for income investors. In the first nine months of FY24, the company reported adjusted free cash flow of $115 million, a significant increase from $14 million in the same period the previous year. This result met the company’s expectations. The improvement in cash flow is mainly due to better management of working capital. Management continues to project that adjusted free cash flow for the fiscal year will be between $850 million and $950 million.
With evolving investment trends, investors are increasingly focused on companies adopting sustainable investment solutions, which are essential for addressing climate change. In 2018, Amcor plc (NYSE:AMCR) became the first global packaging firm to commit to making all of its packaging recyclable or reusable by 2025. This pledge aims to tackle a significant environmental challenge using the company’s capability, scale, and reach. The shifting investment patterns have also significantly boosted the company’s cash generation. The company produces substantial annual cash flow and is dedicated to maintaining an investment-grade credit rating. It is believed that the company’s robust annual cash flow and strong balance sheet enable it to reinvest in the business for organic growth, pursue acquisitions or share repurchases, and return cash to shareholders through attractive and increasing dividends.
During the first nine months of 2024, Amcor plc (NYSE:AMCR) returned $570 million to shareholders through dividends and share repurchases. The company currently pays a quarterly dividend of $0.125 per share and has a dividend yield of 4.75%, as of August 1. With a dividend growth streak spanning over 40 years, AMCR is one of the best dividend stocks on our list.
At the end of March 2024, 17 hedge funds tracked by Insider Monkey held stakes in Amcor plc (NYSE:AMCR), compared with 22 in the previous quarter. These stakes are collectively valued at over $65.6 million. Ken Griffin’s Citadel Investment Group was the company’s leading stakeholder in Q1.
4. Banc of California, Inc. (NYSE:BANC)
Number of Hedge Fund Holders: 18
Share Price as of the Close of July 31: $13.98
Banc of California, Inc. (NYSE:BANC) is an American financial services company that offers a wide range of banking services, including commercial & business banking, specialty banking, and personal banking. Banks can be a promising investment, particularly in strong economies. When consumers are spending confidently and unemployment rates are low, banks often see increased profits and manage to keep loan defaults under control. In addition, banks are also known for their generous dividends. In 2023, the sector provided record dividends and was responsible for half of the global dividend growth.
Banc of California, Inc. (NYSE:BANC) recently announced its second quarter 2024 earnings and showed impressive growth from the prior year period. The bank generated nearly $260 million in revenues, up significantly from $58 million in the same period last year. Its net interest income came in at $230 million, growing from $186 million in the second quarter of 2023. In the second quarter, the company continued to make significant strides in implementing its plan, enhancing its franchise, and boosting core earnings power. It further lowered its cost of funds, increased the net interest margin, and grew average noninterest-bearing deposits despite a challenging interest rate environment. The company is on target with its controllable cost savings and is committed to developing a valuable long-term franchise with a strong deposit base and core operations.
2016 was a pivotal year for Banc of California, Inc. (NYSE:BANC), as it surpassed $10 billion in assets under management—a significant achievement for a bank that had less than $1 billion in assets just five years earlier. This milestone impressed investors, leading to a surge in the stock price to a post-recession high of around $22 per share. It also saw an increase in insider purchases during this period. The company has come a long way since then. At the end of 2023, the bank had nearly $39 billion in assets under management.
Banc of California, Inc. (NYSE:BANC), one of the best dividend stocks on our list, has been paying regular dividends to shareholders since 2003. The company currently pays a quarterly dividend of $0.10 per share and has a dividend yield of 3.11%, as of August 1.
Banc of California, Inc. (NYSE:BANC) was included in 18 hedge fund portfolios at the end of Q1 2024, compared with 21 in the previous quarter, as per Insider Monkey’s database. The stakes held by these hedge funds have a total value of roughly $230 million. With over 6 million shares, Centerbridge Partners was the company’s leading stakeholder in Q1.
3. Kinross Gold Corporation (NYSE:KGC)
Number of Hedge Fund Holders: 31
Share Price as of the Close of July 31: $9.06
Kinross Gold Corporation (NYSE:KGC) is a Canadian silver and gold mining company that has operations across multiple countries. The company reported strong earnings in the second quarter of 2024. Its gold equivalent production reached 535,338 ounces, up from 527,399 ounces in the previous quarter. This growth was fueled by increased throughput and improved grades at various mining sites, reflecting efficient operations and strong production capabilities.
As a dividend stock, Kinross Gold Corporation (NYSE:KGC) is favored by investors because of its robust cash generation. In Q2 2024, the company generated $604 million in operating cash flow and its attributable free cash flow came in at $346 million. This strong free cash flow also allowed the company for $200 million in debt repayment. The company remains committed to carefully managing its operations, with an emphasis on maintaining cost efficiency and capital discipline while progressing with projects and exploration targets to enhance future value. Additionally, it continues to reinforce its investment-grade balance sheet and reduce debt.
Kinross Gold Corporation (NYSE:KGC) reached its all-time low in November 2000, trading at approximately $1.31 per share. This decline was caused by volatile gold prices, operational difficulties, and significant debt levels. Since then, the stock has surged by nearly 568%, with exceptional performance during the Great Recession of 2008. It also hit one of its peaks in April 2008, reaching $22.70 per share.
Kinross Gold Corporation (NYSE:KGC) started paying dividends in 2020 and has paid regular dividends to shareholders since then. It offers a quarterly dividend of $0.03 per share and has a dividend yield of 1.37%, as of August 1.
As of the end of the March quarter of 2024, 31 hedge funds owned stakes in Kinross Gold Corporation (NYSE:KGC), down from 36 in the preceding quarter. These stakes are worth over $374.3 million in total.
2. Ford Motor Company (NYSE:F)
Number of Hedge Fund Holders: 41
Share Price as of the Close of July 31: $10.82
Ford Motor Company (NYSE:F) is a Michigan-based automobile manufacturer that deals in the manufacturing of a wide range of commercial vehicles and luxury cars. The company’s solid cash position makes it a favored income stock among investors. By the end of the second quarter, its strong balance sheet held nearly $27 billion in cash and approximately $45 billion in liquidity. This strong financial standing supports a disciplined approach to capital allocation, allowing for investment in long-term growth and returns to shareholders.
Ford Motor Company (NYSE:F) reached its peak in 1999, trading at approximately $35 per share, thanks to strong sales of sport utility vehicles, pickup trucks, and large cars in the US Since then, it has dropped by over 71%. A significant factor in this decline has been the company’s struggles with high warranty costs. For example, Ford Blue’s EBIT of $1.2 billion was lower compared to the same quarter the previous year, primarily due to increased warranty expenses.
Despite the negative perception, Ford Motor Company (NYSE:F) is not as poorly regarded by analysts as it might appear. J.D. Power, a prominent American data analytics and consumer intelligence firm, recently released its 2024 US Initial Quality Study, which highlighted the company’s progress in recent years. Ford Motor Company (NYSE:F) made a notable leap of 14 positions, moving up to 9th place on the list of brands with the fewest problems per 100 vehicles. In the second quarter of 2024, the company reported revenue of $47.8 billion, up from $45 billion during the same period last year.
Due to its strong cash position, Ford Motor Company (NYSE:F) has paid supplemental dividends to shareholders frequently over the years, in addition to its common dividend. It currently offers a quarterly dividend of $0.15 per share and also paid an additional dividend of $0.18 per share earlier this year. With a dividend yield of 5.98% as of August 1, F is one of the best dividend stocks under $15.
At the end of March 2024, 41 hedge funds, up from 40 in the previous quarter, held stakes in Ford Motor Company (NYSE:F), as per Insider Monkey’s database. These stakes have a consolidated value of over $1.5 billion. Fisher Asset Management owned over 65.2 million shares in the company, becoming its largest shareholder in Q1.
1. Viatris Inc. (NASDAQ:VTRS)
Number of Hedge Fund Holders: 50
Share Price as of the Close of July 31: $12.06
Viatris Inc. (NASDAQ:VTRS) tops our list of the best dividend stocks under $15. The American pharmaceutical company specializes in a wide variety of therapeutic areas. The company spun off from Pfizer in 2020. It reported strong results in the first quarter of 2024. The company’s Brands segment performance shows substantial growth in emerging markets and Europe. The segment generated revenue of $2.3 billion, which declined by nearly 5% from the same period last year. Its overall revenue came in at $3.66 billion, down 2% from the prior-year period. Despite the decline, the company continued to perform well in advancing its product pipeline. In the first quarter, its new products generated $154 million in revenue.
Viatris Inc. (NASDAQ:VTRS) boasts a solid balance sheet and a strong cash position, which the company has been actively utilizing to return cash to shareholders. In the most recent quarter, the company reported an operating cash flow came in at $615 million and its free cash flow amounted to $565 million. The free cash flow was sufficient to return $393 million to shareholders through dividends and share repurchases.
Although Viatris Inc. (NASDAQ:VTRS) has a strong balance sheet and generates solid cash flow, it also carries significant debt, amounting to $18.2 billion as of the most recent quarter. Analysts suggest that a substantial portion of the company’s free cash flow will need to be allocated towards reducing this debt. However, with new products in development, the company’s cash flow remains a relatively minor concern for investors. In addition, its dividend appears to be safe as the company spends about $600 million in annual dividend payments.
Viatris Inc. (NASDAQ:VTRS) currently pays a quarterly dividend of $0.12 per share and has an impressive dividend yield of 4.04%, as of August 1. Since the company initiated its dividend policy in 2021, investors might not anticipate significant dividend increases. This is due to the high interest costs, which suggest that the company is likely to focus on strengthening its balance sheet rather than raising its dividend payouts.
The number of hedge funds holding stakes in Viatris Inc. (NASDAQ:VTRS) jumped to 50 in Q1 2024, from 43 in the previous quarter, as per Insider Monkey’s database. The stakes held by these hedge funds have a collective value of nearly $1.2 billion. Among these hedge funds, Deerfield Management was the company’s leading stakeholder in Q1.
While we acknowledge the potential of VTRS as an investment, our conviction lies in the belief that some deeply undervalued dividend stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued dividend stock that is more promising than VTRS but that trades at less than 7 times its earnings and yields nearly 10%, check out our report about the dirt cheap dividend stock.
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Disclosure: None. This article is originally published at Insider Monkey.
