In this article, we discuss 10 dividend stocks to buy according to billionaire Stanley Druckenmiller’s Duquesne Capital. You can skip our detailed analysis of the billionaire’s investment strategy and his hedge fund’s past performance, and go directly to read 5 Dividend Stocks to Buy According to Billionaire Stanley Druckenmiller’s Duquesne Capital.
Stanley Druckenmiller is one of Wall Street’s most celebrated investors, becoming famous by leading George Soros’ bet against the British pound in 1992. He founded Duquesne Capital in 1981, and after reaping profits for 30 years, he shut down his hedge fund in 2010 and converted it into a family office. Over his service of three decades, his hedge fund outperformed his peers. In 2008, Duquesne Capital returned 11% to shareholders, when average hedge funds fell by 19%, as reported by Bloomberg. In addition to this, his fund also delivered an annual average return of 30% from 1986 to 2010, according to MoneyWeek.
Druckenmiller follows the same investment philosophy as George Soros, following a top-down global macro investment strategy. The billionaire focuses on broad market trends by trading different asset classes globally. In addition to this, he also carries out political and social analyses of the markets he is investing in, which are associated with long-term projections.
As Big Tech suffered a massive sell-off in 2022, Druckenmiller also ditched his tech holdings in the second quarter of 2022. The billionaire was bearish on the tech stocks in the first quarter as well and highlighted the probability of a recession in his interview with Bloomberg in August.
At the end of Q2 2022, Duquesne Capital’s 13F portfolio had a value of over $1.38 billion, compared with $2.8 billion in the previous quarter. Basic materials and services sectors made up the major portion of the fund’s portfolio, with healthcare, consumer goods, and finance taking up the smaller fraction. Some of the fund’s major holdings in Q2 include Microsoft Corporation (NASDAQ:MSFT), Chevron Corporation (NYSE:CVX), and Eli Lilly and Company (NYSE:LLY). In this article, we will elaborate on dividend stocks in billionaire Druckenmiller’s portfolio.
With the recent high inflation, the markets have been volatile and many stock prices could decline further. Nevertheless, there’s also opportunity for long term investors who buy quality companies.
Our Methodology:
For this list, we took the 10 highest dividend yield stocks as of September 8 from billionaire Stanley Druckenmiller’s Duquesne Capital’s top 40 holdings in Q2 2022 and then we sorted them based on the number of hedge funds in our database that held stakes in the same quarter.
10 Dividend Stocks to Buy According to Billionaire Stanley Druckenmiller’s Duquesne Capital
10. Edison International (NYSE:EIX)
Number of Hedge Fund Holders: 26
Dividend Yield as of September 8: 4.12%
Edison International (NYSE:EIX) is a California-based public utility holding company that provides industrial and commercial energy services to its consumers. The company is one of the latest holdings of Duquesne Capital, as the hedge fund opened its position with shares worth over $18 million. The company represented 1.31% of billionaire Druckenmiller’s portfolio and is #10 on our list of 10 dividend stocks to buy according to billionaire Stanley Druckenmiller’s Duquesne Capital.
Edison International (NYSE:EIX) currently pays a quarterly dividend of $0.70 per share. The company last raised its dividend in December 2021, which marked its 18th consecutive year of dividend growth. As of September 8, the stock’s dividend yield stood at 4.12%.
In August, Mizuho maintained its Neutral rating on Edison International (NYSE:EIX) and highlighted the general market issues. The firm also expressed concerns regarding the company’s growing unrecoverable costs.
At the end of Q2 2022, 26 hedge funds tracked by Insider Monkey owned stakes in Edison International (NYSE:EIX), up from 22 in the previous quarter. These stakes hold a collective value of over $1 billion. Among these hedge funds, Pzena Investment Management owned the largest position in the company in Q2.
ClearBridge Investments mentioned Edison International (NYSE:EIX) in its Q4 2021 investor letter. Here is what the firm has to say:
“Defensive sectors such as utilities underperformed the broader market, with our California-based utilities, Edison International, generating modestly below-sector returns on continuing wildfire concerns, despite significantly improved financial exposure due to the 2019 legislation AB 1054. The legislation was a major positive step toward reducing wildfire risk to California public utilities, which we expect to be reflected in improved valuations over time.”
Alongside Freeport-McMoRan Inc. (NYSE:FCX), Chevron Corporation (NYSE:CVX), and Eli Lilly and Company (NYSE:LLY), Edison International (NYSE:EIX) is also one of the most prominent dividend holdings of billionaire Druckenmiller’s portfolio that’s also held by many hedge funds in Q2 2022.
9. Westlake Corporation (NYSE:WLK)
Number of Hedge Fund Holders: 28
Dividend Yield as of September 8: 1.46%
Westlake Corporation (NYSE:WLK) is an American petrochemical company that manufactures and supplies petrochemicals, polymers, and other related products. The company’s products are widely used in the housing and construction sectors. On August 13, it declared a 20% hike in its quarterly dividend to $0.357 per share, with a dividend yield of 1.46%, as recorded on September 8. The company has been making uninterrupted dividend payments since its IPO in 2004. It also maintains a 19-year track record of consistent dividend growth.
Duquesne Capital initiated its position in Westlake Corporation (NYSE:WLK) during the second quarter of 2022, purchasing 145,520 shares. The hedge fund’s total stake in the company amounted to over $14.2 million, which represented 1.03% of its 13F portfolio.
In September, Credit Suisse initiated its coverage of Westlake Corporation (NYSE:WLK) with an Outperform rating and a $120 price target. The firm highlighted the company’s growing sales of building products and its margin trends.
As of the close of Q2 2022, 28 hedge funds tracked by Insider Monkey owned stakes in Westlake Corporation (NYSE:WLK), down from 37 in the previous quarter. These stakes hold a collective value of over $372 million, compared with $470.6 million worth of stakes owned by hedge funds in the preceding quarter.
8. Phillips 66 (NYSE:PSX)
Number of Hedge Fund Holders: 38
Dividend Yield as of September 8: 4.49%
Phillips 66 (NYSE:PSX) is a Texas-based energy company that specializes in petroleum refining. In addition to this, the company transports and markets natural gas liquids and petrochemicals. In July, Barclays raised its price target on the stock to $113 with an Overweight rating on the shares due to the company’s strong quarterly earnings. The firm also appreciated the company’s strategic management.
Duquesne Capital sold off its $24.3 million worth of stake in Phillips 66 (NYSE:PSX) during the third quarter of 2014. The hedge fund again bought shares in the company in Q1 2022 and increased its position by 6% in the recent quarter. The hedge fund owned 119,380 PSX shares in Q2 2022, worth over $9.7 million. The company accounted for 0.7% of billionaire Druckenmiller’s portfolio.
Phillips 66 (NYSE:PSX) holds a stable history of dividend payments. The company has raised its dividends 11 times since its inception in 2012 at a CAGR of 18%. It currently offers $0.97 per share quarterly dividends, with a yield of 4.49%, as of September 8.
D. E. Shaw owned stakes worth over $282 million in Phillips 66 (NYSE:PSX), becoming the company’s leading stakeholder in Q2 2022. Overall, 38 hedge funds in Insider Monkey’s database owned stakes in the company in Q2, worth over $1.07 billion.
7. Coterra Energy Inc. (NYSE:CTRA)
Number of Hedge Fund Holders: 40
Dividend Yield as of September 8: 2.06%
Another prominent dividend stock in billionaire Druckenmiller’s portfolio is Coterra Energy Inc. (NYSE:CTRA), which specializes in the exploration of hydrocarbon. The company also engages in the development and exploration of oil and gas properties. At the end of June 2022, the company was a part of 40 hedge fund portfolios, up from 39 in the previous quarter, according to Insider Monkey’s data. The stakes owned by these funds are collectively valued at over $437.3 million.
Duquesne Capital has been investing in Coterra Energy Inc. (NYSE:CTRA) since the third quarter of 2013 when the hedge fund purchased shares worth over $25.7 million. In Q2 2022, the hedge fund owned nearly 1.4 million CTRA shares, worth over $35.7 million. The company constituted 2.58% of its 13F portfolio.
Coterra Energy Inc. (NYSE:CTRA) declared a quarterly dividend of $0.65 per share in August, consistent with its previous dividend. The company has been raising its dividends consistently for the past five years. As of September 8, the stock’s dividend yield came in at 2.06%.
In August, Barclays raised its price target on Coterra Energy Inc. (NYSE:CTRA) to $43 with an Equal Weight rating on the shares, highlighting the sector’s free cash flow yield.
Palm Valley Capital Management mentioned Coterra Energy Inc. (NYSE:CTRA) in its Q2 2022 investor letter. Here is what the firm has to say:
“We sold two Fund positions during the quarter which includes Coterra Energy (NYSE:CTRA). As a result of surging oil and natural gas prices, Coterra reached our valuation, and we exited the position in April.”
6. Cenovus Energy Inc. (NYSE:CVE)
Number of Hedge Fund Holders: 42
Dividend Yield as of September 8: 1.86%
Cenovus Energy Inc. (NYSE:CVE) is a Canadian natural gas company that develops the country’s valuable oil and natural gas resources. The company currently pays a quarterly dividend of C$0.105 per share and has a yield of 1.86%, as recorded on September 8. Cenovus Energy Inc. (NYSE:CVE) also ranks among the 10 dividend stocks to buy according to billionaire Stanley Druckenmiller’s Duquesne Capital.
Duquesne Capital resumed its position in Cenovus Energy Inc. (NYSE:CVE) during the first quarter of 2021, after selling off its entire CVE stake worth roughly $10 million during the third quarter of 2018. In Q2 2022, the hedge fund owned over 1 million shares in the company, valued at over $20.3 million. The company represented 1.47% of billionaire Druckenmiller’s portfolio and is his important holding among other stocks like Microsoft Corporation (NASDAQ:MSFT), Chevron Corporation (NYSE:CVX), and Eli Lilly and Company (NYSE:LLY).
In August, Credit Suisse initiated its coverage of Cenovus Energy Inc. (NYSE:CVE) with an Outperform rating and a C$37 price target.
As per Insider Monkey’s database for Q2 2022, 42 hedge funds reported owning stakes in Cenovus Energy Inc. (NYSE:CVE), compared with 44 in the previous quarter. These stakes hold a collective value of nearly $3 billion. Soroban Capital Partners owned the largest stake in the company in Q2, worth roughly $957 million.
L1 Capital mentioned Cenovus Energy Inc. (NYSE:CVE) in its Q4 2021 investor letter. Here is what the firm has to say:
“Detailed, bottom-up stock research remains the investment team’s primary focus and the core driver of portfolio performance. 2021 once again demonstrated the team’s ability to identify ‘winners’ through extensive company and industry research across a diverse range of sectors. Key contributors included Cenovus Energy, (due to) recovering oil price leading to improved investor sentiment, consensus earnings upgrades and strong free cashflow generation.”
Like Cenovus Energy Inc. (NYSE:CVE), Freeport-McMoRan Inc. (NYSE:FCX), Chevron Corporation (NYSE:CVX), and Eli Lilly and Company (NYSE:LLY) are dividend stocks in billionaire Stanley Druckenmiller’s Duquesne Capital Q2 2022 portfolio that are also widely held by hedge funds.
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Disclosure. None. 10 Dividend Stocks to Buy According to Billionaire Stanley Druckenmiller’s Duquesne Capital is originally published on Insider Monkey.
