In this article, we will discuss some of the best dividend knights that beat the market last three years.
The broader market has been performing strongly this year, rising by nearly 30% since the beginning of 2024. According to Morningstar Direct, the S&P 500’s return has exceeded this level in only 17 of the past 74 years. For instance, in 1954, the index saw a gain of over 52%, and in 1989, it increased by about 31%. However, analysts caution investors to manage their expectations, as years with such exceptional returns are uncommon. Cathy Curtis, a certified financial planner and the founder and CEO of Curtis Financial Planning made the following comment about the market’s performance this year in one of her recent interviews with CNBC:
“Investors should know that the stock market has an average annualized return of over 10% for decades. The past year has seen growth way over this amount and it would be highly unusual for that to continue for a multi-year timeframe.”
Regardless of where the market ends up, dividend stocks have strong potential, as demonstrated over the years. During past periods of inflation, dividend stocks performed better compared to other asset classes. Since the 1940s, dividends have accounted for 40% of the market, with this share increasing during times of higher inflation, according to Hartford Funds. The report also highlighted the performance of dividend stocks in the 1970s, when they made up 73% of the market’s returns. Additional studies, including one from Fidelity International, showed that dividends typically grow faster than inflation. Fidelity’s research indicated that since 1900, the 10-year annual average growth of dividends in the market has outpaced CPI growth nearly 73% of the time.
In addition to their considerable impact on overall market returns, dividend stocks provide investors with a way to mitigate risks linked to market volatility. According to DWS Group, over the past 20 years, the monthly volatility of dividend returns was just 0.10%, compared to 3.75% for price returns. The report also noted that despite market fluctuations, investors have seen positive overall returns during this period. While riskier factors played a significant role in these returns, it was the dividend stream that proved to be a more stable and safer option amid the uncertainties of the stock market.
Also read: 10 Best Consistent Dividend Stocks To Invest In Right Now
Although dividend stocks have recently lagged behind the broader market, they remain a popular investment choice due to their strong long-term returns. The Dividend Aristocrats Index has grown by just nearly 11% this year, but the outlook for dividend growth among US companies is promising. According to Howard Silverblatt, Senior Index Analyst at S&P Dow Jones Indices, large-cap stocks outperformed many others in the first three quarters of 2024, driven by record earnings and an anticipated record dividend payout for the year. He further added that the market’s large caps are expected to see a 6% increase in dividend payments for 2024, compared with 5.1% in 2023 and 10.8% in 2022.
When it comes to dividend investing, investors often prefer companies with a strong track record of dividend growth and solid returns as they help prepare for challenging market conditions. Additionally, investors focus on a company’s ability to generate cash flow and maintain a strong balance sheet, as these factors support the sustainability of future dividend payouts. In view of this, we will take a look at some of the best dividend knights that have outperformed the market in the last three years.
Image by Steve Buissinne from Pixabay
Our Methodology:
For this list, we used a stock screener and selected dividend companies that have outperformed the market in the past three years. These companies also have strong dividend growth track records under their belt. We also considered hedge fund sentiment around each stock using Insider Monkey’s data for Q3 2024. The stocks are ranked in ascending order of their three-year returns.
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. Linde plc (NYSE:LIN)
3-Year Share Price Gains as of December 4: 40.5%
Linde plc (NYSE:LIN) is a multinational chemicals company that manufactures products for a wide variety of industries. Though economic challenges continued in the third quarter, the company delivered impressive results, achieving a 9% increase in EPS, raising ROC to 25.8%, and improving operating margins by 130 basis points to 29.6%. Alongside managing short-term performance, the company secured its largest-ever sale-of-gas project, boosting its project backlog to $10 billion. This move ensures future growth within the traditional industrial gas model while adhering to its disciplined investment standards. In the past 3 years, the stock has surged by over 40%, which makes it one of the best dividend knights that beat the market.
Linde plc (NYSE:LIN) reported revenue of $8.4 billion, which showed a 2.46% return from the same period last year. The revenue also beat analysts’ estimates by $9.33 million. The company’s operating profit came in at $2.1 billion and its operating profit margin came in at 25%. Mar Vista Investment Partners, LLC mentioned LIN in its Q3 2024 investor letter. Here is what the firm has to say:
“Linde plc (NASDAQ:LIN) is the world’s largest, global industrial gas producer. The company enjoys the highest profit margins and returns on capital in the industry. Linde’s primary products are atmospheric gases and process gases. Industrial gases have benefitted from secular growth trends in decarbonization and carbon sequestration. Moreover, the opportunity in blue and green ammonia and hydrogen are substantial. Projects in these areas are quickly being added to its backlog for future growth. We see these secular trends as long-term positives for Linde and the entire industrial gas industry.
Linde believes it can grow its volumes with new applications; the buildout of small, on-site plants using its technologies; and focusing on growing geographies such as India, Malaysia, Vietnam, China and Brazil. Despite the long-term growth opportunities, recent demand trends have slowed due to weak global industrial production and a challenging year-over-year comparable. Among the regions, the U.S. remains resilient, with volumes flat to slightly negative. Europe, Latin America, the Middle East, and China are all sending mixed to negative economic signals. We believe these slower trends are transitory in nature, providing an opportunity to purchase shares in Linde at attractive prices.”
Linde plc (NYSE:LIN)’s cash position also remained strong in the third quarter. The company generated $2.73 billion in operating cash flow, up 8% from the prior-year period. Its free cash flow came in at $1.66 billion. During the quarter, it returned $1.3 billion to shareholders through dividends and share repurchases. The company offers a quarterly dividend of $1.39 per share and has a dividend yield of 1.23%, as of December 5. It maintains a 29-year streak of dividend growth.
At the end of Q3 2024, 63 hedge funds tracked by Insider Monkey held stakes in Linde plc (NYSE:LIN), the same as in the previous quarter. The consolidated value of these stakes is over $3.6 billion.
9. JPMorgan Chase & Co. (NYSE:JPM)
3-Year Share Price Gains as of December 4: 55.7%
JPMorgan Chase & Co. (NYSE:JPM) is an American multinational investment banking company. It has delivered exceptional performance in recent years, outperforming its banking peers in key metrics and achieving outstanding earnings. The bank’s success can be attributed to its strategic patience and effective capital management across the interest rate cycle. During 2020 and 2021, when the Federal Reserve cut interest rates to near zero and rates on treasuries and mortgages dropped significantly, many banks invested heavily in low-interest-earning assets due to excess deposits. However, JPMorgan took a different approach, retaining a substantial portion of its capital in cash and liquid securities.
In the third quarter of 2024, JPMorgan Chase & Co. (NYSE:JPM) reported revenue of $42.7 billion, which saw a 7% growth from the same period last year. The firm delivered solid financial and operational results, reporting $12.9 billion in net income and achieving a return on tangible common equity (ROTCE) of 19%. Within its Corporate & Investment Bank (CIB) division, investment banking fees increased by 31%, and Markets revenue showed strength with an 8% growth.
JPMorgan Chase & Co. (NYSE:JPM) is a strong dividend payer. The company returned $3.6 billion to shareholders through dividends in the most recent quarter. It currently pays a quarterly dividend of $1.25 per share and has a dividend yield of 2.03%, as of December 5. With a 3-year share price gain of 55.7%, JPM is one of the best dividend knights.
As of the close of Q3 2024, 105 hedge funds in Insider Monkey’s database owned stakes in JPMorgan Chase & Co. (NYSE:JPM), compared with 111 in the preceding quarter. These stakes have a total value of over $8.6 billion. With nearly 17 million shares, Fisher Asset Management owned the largest stake in the company.
8. W.W. Grainger, Inc. (NYSE:GWW)
3-Year Share Price Gains as of December 4: 142.4%
W.W. Grainger, Inc. (NYSE:GWW) ranks eighth on our list of the best dividend knights. The Illinois-based company provides a wide range of tools, equipment, and supplies to businesses, government entities, and institutions across various industries. It generates revenue through two primary segments: High-Touch Solutions (HTS) and Endless Assortment. The HTS segment serves as the company’s primary revenue driver. Known for its solid fundamentals, the company boasts an impressive shareholder rewards program and a reliable business model that has consistently delivered returns surpassing market averages over time. In the past three years, the stock has surged by over $142%, surpassing the broader market.
W.W. Grainger, Inc. (NYSE:GWW) generated $4.4 billion in revenues in the third quarter of 2024, up 4.28% from the same period last year. The company’s operating margin came in at 15.6%. Its gross profit also showed a 4% growth on a YoY basis at $1.72 billion. ClearBridge Investments highlighted the company in its Q1 2024 investor letter. Here is what the firm has to say:
“W.W. Grainger, Inc. (NYSE:GWW), in the industrials sector, was our largest new buy. Grainger is the biggest industrial maintenance, repair, and operations distributor in North America. The company is a share gainer in a large and fragmented market, with less than 10% share of the addressable market for their direct, “high touch solutions” business estimated at more than $165 billion. Grainger has also barely scratched the surface with its online “endless assortment” platform, Zoro.com, which targets an even larger market. In addition to its growth and profit potential, we are attracted to Grainger’s strong balance sheet and improved capital allocation under its current management.”
W.W. Grainger, Inc. (NYSE:GWW) has a strong balance sheet, supported by a healthy cash reserve. In the most recent quarter, the company generated $611 million in operating cash flow and also returned $328 million to shareholders in dividends and share repurchases. It has been rewarding shareholders with growing dividends for the past 53 years. Currently, the company pays a quarterly dividend of $2.05 per share and has a dividend yield of 0.69%, as of December 5.
Insider Monkey’s database of Q3 2024 indicated that 34 hedge funds owned stakes in W.W. Grainger, Inc. (NYSE:GWW), up from 32 in the previous quarter. The consolidated value of these stakes is $614.7 million. Citadel Investment Group was the company’s leading stakeholder in Q3 among these hedge funds.
7. Brown & Brown, Inc. (NYSE:BRO)
3-Year Share Price Gains as of December 4: 70.28%
Brown & Brown, Inc. (NYSE:BRO) is an American insurance company that specializes in risk management. The company reported strong earnings in the third quarter of 2024, with its revenues coming in at $1.19 billion, which showed an 11% growth from the same period last year. Its net income also jumped by 33% on a YoY basis at $234 million.
Madison Investments highlighted the performance of Brown & Brown, Inc. (NYSE:BRO) in its Q4 2023 investor letter. The firm also mentioned the strengths of its business and the company’s ability to overcome the obstacles it encountered.
“Whether it’s performance by market capitalization, sectors, or any other factor, stock markets are intrinsically cyclical. Some cycles are long-term, taking decades to unfold, and some are short-term, lasting months, weeks, or even days. Many are medium in length, lasting two, three, or several years. Most cycles occur because a trend often creates the seeds of its own reversal. We at Madison Investments are certain that market cycles will occur, but it doesn’t mean we can predict their timing or magnitude. We don’t think we can. This is perhaps a major difference between us and many other investors. Most investors believe it’s their job to time market cycles despite overwhelming evidence that it’s nearly impossible to do so with enough accuracy to make such an effort profitable over long periods. We avoid making calls about market cycles and spend zero minutes thinking about them, not because we don’t think they can be important, but because we think they’re inherently unpredictable in duration.
This mentality of our team is generally true for other kinds of cycles, such as macroeconomic, industry, or company-specific, but is a bit more nuanced for those. We make no explicit prediction about cycles on which we base a buy or sell decision. Still, we are acutely aware of the various cyclical forces at work, and depending on whether we think we have the ability to assess the length or intensity of such, we may incorporate them to various degrees.
Let’s take another example of a recession-resistant investment we’ve held for many years, Brown & Brown, Inc. (NYSE:BRO). We first purchased this company in 2007 in our Mid Cap strategy. As an insurance broker, it gets paid a commission on the premiums that its mostly small business clients pay. Since clients need to maintain insurance coverage even in business downturns, Brown & Brown’s revenues tend to be very steady year by year. Yet, our investment underperformed for the seven years after our initial purchase, and it wasn’t because we paid a high price – the stock traded at a moderate price to earnings (P/E) of 17x at the time. The culprit was profits. After increasing sixfold over the seven years before our purchase, earnings per share were essentially flat from 2007 to 2014, going from $0.68 per share to $0.71 per share. No wonder our investment underperformed the Russell Midcap benchmark over that period. The sources of sluggish profits were manifold, including management turnover, a change in its acquisition strategy, moderate under-investments in dealing with the shift towards more complex insurance needs among its customer base, and a heavy exposure to Florida, a state hit especially hard during the Great Financial Crisis…” (Click here to read the full text)
Brown & Brown, Inc. (NYSE:BRO) has a strong cash position, which promises consistent dividend growth. The company ended the quarter with $957 million available in cash and cash equivalents, up from $700 million nine months ago. Moreover, its operating cash flow came in at $813 million, growing from $704 million in the prior-year period.
On October 23, Brown & Brown, Inc. (NYSE:BRO) declared a 15.4% hike in its quarterly dividend to $0.15 per share. Through this increase, the company stretched its dividend growth streak to 31 years, which makes BRO one of the best dividend knights on our list. The stock supports a dividend yield of 0.54%, as of December 5.
The number of hedge funds tracked by Insider Monkey owning stakes in Brown & Brown, Inc. (NYSE:BRO) jumped to 35 in Q3 2024, from 26 in the previous quarter. The overall value of these stakes is more than $1.57 billion. Select Equity Group was the company’s leading stakeholder in Q3.
6. Exxon Mobil Corporation (NYSE:XOM)
3-Year Share Price Gains as of December 4: 88.2%
Exxon Mobil Corporation (NYSE:XOM) is an American energy company. Its appeal as an investment lies in its diverse portfolio of top-tier assets. The company’s extensive operations, covering exploration, production, refining, marketing, and specialty chemicals, provide a competitive edge in the industry by mitigating risks and capitalizing on its global infrastructure to optimize cash flow generation. In the past three years, the stock has surged by over 88%, which makes it one of the best dividend knights.
Exxon Mobil Corporation (NYSE:XOM) reported solid earnings in the third quarter of 2024, generating revenues of $90.02 billion, which surpassed analysts’ estimates by $1.66 billion. The company is at the forefront of carbon capture and storage initiatives, securing a new customer agreement that raises its contracted CO2 offtake to 6.7 million metric tons annually—an amount that surpasses the committed volumes reported by any other firm.
Exxon Mobil Corporation (NYSE:XOM) has a strong cash position. In the most recent quarter, the company’s operating cash flow came in at $17.6 billion and its free cash flow amounted to $11.3 billion. Moreover, it returned $9.8 billion to shareholders through dividends and share repurchases. The company currently offers a quarterly dividend of $0.99 per share, having raised it by 4% in November this year. With this increase, its dividend growth streak has reached 42 years. The stock supports a dividend yield of 3.45%, as of December 5.
Exxon Mobil Corporation (NYSE:XOM) was a part of 86 hedge fund portfolios at the end of Q3 2024, compared with 92 in the previous quarter, as per Insider Monkey’s database. The stakes held by these funds have a collective value of nearly $7 billion.
5. Walmart Inc. (NYSE:WMT)
3-Year Share Price Gains as of December 4: 107.6%
Walmart Inc. (NYSE:WMT) is an Arkansas-based retail corporation that operates a chain of hypermarkets, discount stores, and grocery stores across the country. The company is leveraging its competitive advantages to deliver substantial financial gains for its investors. Its improving cash flow and profitability are not only a result of gaining market share but also from the company’s profitable e-commerce segment, which has become successful after significant infrastructure investments. Moreover, strategic actions such as price cuts and more efficient inventory management have contributed to these positive outcomes.
Walmart Inc. (NYSE:WMT) delivered a 107.6% return in the past three years, significantly outperforming the broader market during this period. In addition, the company experienced growth in customer traffic this year, with a 3% increase in the third quarter compared to the same time last year. This is a favorable trend for any large retailer.
In the third quarter of 2024, Walmart Inc. (NYSE:WMT) reported revenue of $168 billion, reflecting a 5.5% increase from the previous year. This performance exceeded analysts’ expectations by $1.4 billion. Known for its strong dividend payouts, the company maintains a healthy cash position. Year-to-date, it has generated $22.9 billion in operating cash flow, up by $3.9 billion compared to the same period last year. Its free cash flow also rose by $1.9 billion year-over-year, reaching $6.2 billion. The company has raised its payouts for 51 years in a row. It currently offers a quarterly dividend of $0.2075 per share and has a dividend yield of 0.87%, as of December 5.
As per Insider Monkey’s database of Q3 2024, 88 hedge funds owned stakes in Walmart Inc. (NYSE:WMT), compared with 95 in the previous quarter. The total value of these stakes is more than $9.7 billion.
4. Cintas Corporation (NASDAQ:CTAS)
3-Year Share Price Gains as of December 4: 109.1%
Cintas Corporation (NASDAQ:CTAS) is an American company that offers a range of products and services primarily focused on workplace essentials, including uniform rental and facility services. The company reported solid earnings in its fiscal Q1 2025. Its revenue came in at $2.5 billion, which showed a 6.8% growth from the same period last year. The revenue beat analysts’ estimates by over $8 million. Its gross margin also grew to $1.25 billion during the quarter, from $1.14 billion in the prior-year period.
In view of its strong earnings, the company announced an upward revision to its full fiscal year financial guidance. Annual revenue projections have been raised from the previous range of $10.16 billion–$10.31 billion to a new range of $10.22 billion–$10.32 billion. Additionally, the guidance for diluted EPS has been increased from $4.06–$4.19 to $4.17–$4.25.
On October 30, Cintas Corporation (NASDAQ:CTAS) currently offers a quarterly dividend of $0.39 per share and has a dividend yield of 0.70%, as of December 5. The company’s strong cash position has made it possible for it to increase its payouts consecutively for 41 years. In the most recent quarter, it generated $466.7 million in operating cash flow, up from $337 million in the prior-year period. The company also returned approximately $158 million to shareholders through dividends in Q1.
According to Insider Monkey’s database of Q3 2024, 48 hedge funds held stakes in Cintas Corporation (NASDAQ:CTAS), up from 46 in the previous quarter. The collective value of these stakes is over $1.76 billion. Among these hedge funds, Impax Asset Management was the company’s leading stakeholder in Q3.
3. Oracle Corporation (NYSE:ORCL)
3-Year Share Price Gains as of December 4: 111.7%
Oracle Corporation (NYSE:ORCL) ranks third on our list of the best dividend knights. The computer software company is renowned for its high-quality data center infrastructure, which is essential for AI development, and demand for its services is far exceeding supply. Known for its cost-efficient operations, the company has become a preferred choice for leading AI start-ups like OpenAI, Cohere, and Elon Musk’s xAI. Despite its efforts, it struggles to meet demand, with 162 data centers currently operational or under construction as of the first quarter of fiscal 2025. Oracle aims to significantly expand this number to between 1,000 and 2,000 in the future. In the past three years, ORCL has significantly outperformed the market, returning nearly 112%.
Oracle Corporation (NYSE:ORCL) is preparing to release its fiscal Q2 2025 earnings. Ahead of that, it’s worth revisiting the company’s strong performance in Q1, where it delivered impressive results. In Q1, the company reported revenue of $13.3 billion, which grew by 6.86% from the same period last year. Its Cloud revenue saw a huge increase of 21% on a YoY basis at $5.6 billion. The highlight of the quarter was Oracle’s announcement of a MultiCloud agreement with AWS. This partnership includes the company’s advanced Exadata hardware and the latest Version 23ai of its database software, integrated directly into AWS cloud data centers. Once the service launches in December, AWS customers will have seamless access to the Oracle database.
Mar Vista Investment Partners, LLC also highlighted Oracle Corporation (NYSE:ORCL)’s could business in its Q3 2024 investor letter. Here is what the firm said:
“Oracle Corporation (NYSE:ORCL) is seeing revenue acceleration as it benefits from several years of investing in cloud-based solutions, which are now driving demand. The company is seeing broad-based demand for multiple of its cloud offerings, including its Fusion ERP Suite, its NetSuite offering and the Oracle Database. In addition to those anchor products, Oracle is also gaining traction with its OCI Gen 2 platform-as-a-service offering, which is winning mindshare from leading cloud customers, including Open AI, due to its favorable performance and cost metrics. This OCI Gen 2 solution is well-positioned to become a viable hyper scaler offering, furthered by Oracle’s recently announced partnerships with Microsoft Azure, Google Compute Platform, and Amazon’s AWS, which have all agreed to host Oracle’s flagship database in their respective hyper-scaler cloud environments. We believe this could support a third leg of growth for Oracle as its large installed base of database customers shift from on-premises to cloud deployments. As database customers migrate to a Cloud subscription model, Oracle could increase database software support revenues by 3-to-5 times. We continue to believe Oracle is well-positioned to grow intrinsic value strong double-digits over our investment horizon.”
Oracle Corporation (NYSE:ORCL) has a strong history of paying dividends to shareholders. The company has been making regular dividend payments to shareholders since 2009. Its consistent dividend payouts are supported by a robust cash position. In FY23, the company generated $19.1 billion in operating cash flow and its free cash flow came in at $11.3 billion. It currently offers a quarterly dividend of $0.40 per share and has a dividend yield of 0.83%, as of December 5.
As of the end of Q3 2024, 91 hedge funds tracked by Insider Monkey held stakes in Oracle Corporation (NYSE:ORCL), compared with 93 in the previous quarter. The total value of these stakes is more than $7 billion.
2. Broadcom Inc. (NASDAQ:AVGO)
3-Year Share Price Gains as of December 4: 206.7%
Broadcom Inc. (NASDAQ:AVGO) is an American multinational semiconductor company that offers a wide range of semiconductor and infrastructure software products. The company contributes to the development of AI infrastructure in two key areas. One is its networking portfolio, which includes components like switches and network interface cards (NICs). Switches enable communication between multiple devices, while NICs establish network connections. It is one of the best dividend knights, generating a nearly 207% return in the past three years.
Broadcom Inc. (NASDAQ:AVGO) delivered strong performance in fiscal Q3 2024, reporting $13.07 billion in revenue—a 47% increase compared to the same quarter last year. This growth highlights the company’s continued success in AI semiconductor solutions and VMware. Revenue from AI is expected to reach $12 billion for fiscal 2024, driven by Ethernet networking and custom accelerators for AI data centers. The integration of VMware is advancing well and is anticipated to boost adjusted EBITDA margins to 64% of revenue by the end of the fiscal year.
In addition to its strong performance, Broadcom Inc. (NASDAQ:AVGO) also maintains a solid cash position. The company reported an operating cash flow of $5 billion and a free cash flow of $4.8 billion, representing 37% of its revenue. Broadcom returned $2.4 billion to shareholders through dividends during the quarter, solidifying its reputation as an excellent choice for dividend-focused portfolios.
Broadcom Inc. (NASDAQ:AVGO) offers a quarterly dividend of $0.53 per share and has a dividend yield of 1.18%, as of December 5. The company has consistently increased its payouts for 13 years in a row.
Broadcom Inc. (NASDAQ:AVGO) was included in 128 hedge fund portfolios at the end of Q3 2024, as per Insider Monkey’s database. The stakes owned by these hedge funds have a consolidated value of over $14.5 billion. With over 23.4 million shares, Fisher Asset Management was the company’s leading stakeholder in Q3.
1. Eli Lilly and Company (NYSE:LLY)
3-Year Share Price Gains as of December 4: 234.2%
Eli Lilly and Company (NYSE:LLY) is an Indiana-based pharmaceutical company that manufactures and develops a wide range of medicines for serious ailments. The company received positive news regarding its weight loss programs, as President Joe Biden recently proposed extending Medicare and Medicaid coverage to this category of medications. If approved, the measure would make these treatments available to millions of additional patients, potentially driving a significant boost in sales. While the proposal’s outcome is uncertain, the market remains optimistic about the potential benefits for Eli Lilly. The stock has surged by nearly 40% since the start of 2024.
In fiscal Q4 2024, Eli Lilly and Company (NYSE:LLY) reported revenue of $11.4 billion, which showed a 20.5% growth from the same period last year. The company showed impressive growth of Mounjaro and Zepbound, alongside a notable 17% increase in non-incretin revenue. This growth, which includes contributions from its oncology, immunology, and neuroscience portfolios, was achieved compared to the same period in Q3 2023. Aristotle Atlantic Partners, LLC made the following comment about LLY in its Q3 2024 investor letter.
“Eli Lilly and Company (NYSE:LLY) is a leading pharmaceutical company that develops diabetes, oncology, immunology and neuroscience medicines. The company generates over half of its revenue in the U.S. from its leading drugs Trulicity, Verzenio and Taltz. The company operates in a single business segment: human pharmaceutical products.
Eli Lilly has a deep pipeline in treatment areas focused on metabolic disorders, oncology, immunology and central nervous system disorders. Currently, there are two phase-three assets: orforglipron, an oral GLP-1, and retatrutide, a triple incretin agonist, which could possibly expand upon the potential success of Mounjaro. We believe that Mounjaro has the potential to commercialize beyond Type 2 diabetes and obesity, potentially in the areas mentioned above of heart disease, sleep apnea, fatty liver disease and chronic kidney disease. We believe the premium valuation is supported by this outsized growth profile.”
On October 28, Eli Lilly and Company (NYSE:LLY) declared a quarterly dividend of $1.30 per share, which was in line with its previous dividend. Overall, the company has been growing its dividends for ten consecutive years, which makes it one of the best dividend knights. The stock supports a dividend yield of 0.63%, as of December 5.
The number of hedge funds tracked by Insider Monkey owning stakes in Eli Lilly and Company (NYSE:LLY) grew to 106 in Q3 2024, from 100 in the previous quarter. The consolidated value of these stakes is more than $18.5 billion. Ken Fisher’s Fisher Asset Management was the company’s leading stakeholder in Q3.
Overall, Eli Lilly and Company (NYSE:LLY) ranks first on our list of the best dividend knights. While we acknowledge the potential for LLY to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than LLY but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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