In this article, we take a look at 10 dividend stocks to buy under $20. If you want to skip our detailed discussion on dividend investing and the performance of dividend stocks over the years, skip ahead to 5 Dividend Stocks to Buy Under $20.
Dividend stocks have passed the test of time when it came to paying back investors. According to a 2021 report by Hartford Funds, dividend stocks have contributed significantly to returns on investment for over 50 years. Between 1930 and 2020, dividend stocks have contributed approximately 41% to the S&P 500 Index’s total returns. Taking a look at the 1970s, dividend stocks have contributed an astounding 80% to the S&P 500 Index’s total returns.
Barclays pointed out that reinvested dividends add more value to the total return on investment, for instance, bringing attention to the fact that dividend stocks do not only have an impact on an investor’s portfolio, but dividend stocks also change the way the market behaves. Expert estimates suggest that returns from dividends made up the majority of the total return for the S&P 500 Index over the past century. Between 1900 and 2000, the total returns for the S&P 500 Index were estimated to be 10.4%, of which 5.5% came from returns on dividends. The remaining 4.9% came from returns from price appreciation.
Some famous stocks among dividend investors and hedge funds include The Coca-Cola Company (NYSE: KO), Johnson & Johnson (NYSE: JNJ), Johnson & Johnson (NYSE: JNJ), and The Procter & Gamble Company (NYSE: PG). These corporations are known as the “Dividend Kings”, as a result of boasting consistent dividend growth and relatively high yields. These stocks have been living up to their name for over 50 years now. Unfortunately, not every individual can afford to invest in these stocks. Some people may still be getting acquainted with the idea of dividend investing, and starting off with the “Dividend Kings” might seem a little out of reach for beginner investors. This is exactly why we, at Insider Monkey, compiled this list of 10 dividend stocks to buy under $20.
Investing has become difficult by the day, even for smart money. 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 86 percentage points since March 2017. Between March 2017 and July 2021, our monthly newsletter’s stock picks returned 186.1%, vs. 100.1% for the SPY (see the details here). 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.
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10 Dividend Stocks to Buy Under $20
10. People’s United Financial, Inc. (NASDAQ:PBCT)
Number of Hedge Fund Holders: 24
Dividend Yield: 4.12%
People’s United Financial, Inc. (NASDAQ:PBCT) operates as the bank holding company for People’s United Bank, National Association that provides commercial banking, retail banking, and wealth management services to individual, corporate, and municipal customers.
By the end of the June quarter, 24 hedge funds out of the elite 873 funds tracked by Insider Monkey held stakes in People’s United Financial, Inc. (NASDAQ:PBCT) worth approximately $219 million. This is compared to 20 positions in the prior quarter, with a total stake value of roughly $208.5 million.
Like The Coca-Cola Company (NYSE:KO), Johnson & Johnson (NYSE:JNJ), and The Procter & Gamble Company (NYSE:PG), People’s United Financial, Inc. (NASDAQ:PBCT) is famous dividend stock in 2021.
9. Hennessy Advisors, Inc. (NASDAQ:HNNA)
Number of Hedge Fund Holders: 1
Dividend Yield: 5.29%
Hennessy Advisors, Inc. (NASDAQ:HNNA) is a publicly owned investment manager. It provides its services to Hennessy Funds and investment companies. The firm launches and manages equity, fixed income, and balanced mutual funds.
For the fiscal third quarter of 2021, Hennessy Advisors, Inc. (NASDAQ:HNNA) reported earnings per share of $0.30. The company’s $4.31 million revenue is reflective of a 24.06% year-over-year growth. Hennessy Advisors, Inc. (NASDAQ:HNNA) has a trailing twelve-month PE ratio of 10.40 and has gained 15.34% over the past six months and 25.75% year to date.
You can consider investing in Hennessy Advisors, Inc. (NASDAQ:HNNA) if you are looking for dividend stocks to invest in. Other popular dividend stocks are The Coca-Cola Company (NYSE:KO), Johnson & Johnson (NYSE:JNJ), and The Procter & Gamble Company (NYSE:PG).
8. Star Group L.P. (NYSE:SGU)
Number of Hedge Fund Holders: 11
Dividend Yield: 5.30%
Star Group, L.P. (NYSE:SGU) sells home heating and air conditioning products and services to residential and commercial home heating oil and propane customers in the United States. Star Group, L.P. (NYSE:SGU) was founded in 1995 and is based in Stamford, Connecticut. Star Group, L.P. (NYSE:SGU) is ranked eighth on our list of the 10 dividend stocks to buy under $20.
By the end of the second quarter of 2021, Star Group, L.P. (NYSE:SGU) was present in the portfolios of 11 hedge funds, out of the 873 funds tracked by Insider Monkey.
7. Banco Santander (Brasil) S.A. (NYSE:BSBR)
Number of Hedge Fund Holders: 7
Dividend Yield: 5.48%
Banco Santander (Brasil) S.A. (NYSE:BSBR) provides various banking products and services to individuals, small and medium enterprises, and corporate customers in Brazil and internationally.
This July, Bradesco BBI analyst Gustavo Schroden assumed coverage of Banco Santander (Brasil) S.A. (NYSE:BSBR) with a Neutral rating and R$47 price target, citing limited upside.
By the end of the second quarter of 2021, 7 hedge funds of the 873 funds tracked by Insider Monkey held stakes in Banco Santander (Brasil) S.A. (NYSE:BSBR) worth $9.63 million.
Banco Santander (Brasil) S.A. (NYSE:BSBR) offers a dividend yield of 5.48%. Other stocks that offer high dividends are The Coca-Cola Company (NYSE:KO), Johnson & Johnson (NYSE:JNJ), and The Procter & Gamble Company (NYSE:PG).
6. Arbor Realty Trust, Inc. (NYSE:ABR)
Number of Hedge Fund Holders: 18
Dividend Yield: 6.98%
Arbor Realty Trust, Inc. (NYSE:ABR) invests in a diversified portfolio of structured finance assets in the multifamily, single-family rental, and commercial real estate markets in the United States. The company operates in two segments, Structured Business and Agency Business.
This July, Arbor Realty Trust, Inc. (NYSE:ABR) announced that its Board of Directors has declared a quarterly cash dividend of $0.35 per share of common stock for the quarter ended June 30, 2021. This is the company’s fifth consecutive quarterly increase, representing a 12.9% increase from a year ago.
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Disclosure: None. 10 Best Dividend Stocks to Buy Under $20 is originally published on Insider Monkey.
