10 Most Popular Dividend Stocks on Robinhood

Published on March 3, 2022 at 9:56 am by Omer Farooq in Dividend Stocks, Hedge Funds, News

In this article, we will be looking at the 10 most popular dividend stocks on Robinhood. You can skip our detailed analysis of these stocks and go directly to the 5 Most Popular Dividend Stocks on Robinhood.

High Volatility and Surging Inflation

As we entered 2022, the market situation has been relatively volatile. U.S. employers had added 467,000 jobs in January, topping the forecast of 300,000 job openings in total. According to the former U.S. Treasury Secretary, Lawrence H. Summers, the economy is moving towards an entrenched inflation rate of over the estimated 2%. Mr. Summers also points out that the Fed is behind the curve and has to catch up.

“An economy with 4% in declining unemployment rate, with a record level of job vacancies, and with wage inflation now on more and more measures above 6%, I think that the greater risk is that we under-tighten and that we end up with an economy with underlying inflation of above 4%,” Summer said.

The Power of Dividends

In times like these, dividend investing is one strategy that will pay and can help you get through periods of surging inflation. Apart from being a proven method of developing a passive income stream, dividend stocks have been seen to outperform market indices since the 1930s. Dividend stocks aid investors in reaping the benefits of compounding, since they can reinvest any capital gains made over a certain period of time. According to research conducted by Denise Chisholm, director of the quantitative market strategy for Fidelity, during periods of rising inflation rates company stocks that raised their dividend payouts have been seen to outperform the broad market indices significantly.

Going back to the 1940s, and then the 1970s, when inflation rates were on their respective record highs, dividend stocks accounted for 65% and 71% of the S&P 500’s return, respectively.

Robinhood Markets

As of January 2022, Robinhood Markets claims to have over 22 million users. Among the most widely held stocks by Robinhood users, we see names like Exxon Mobil Corporation (NYSE:XOM), Verizon Communications Inc. (NYSE:VZ), Microsoft Corporation (NASDAQ:MSFT), and Apple Inc. (NASDAQ:AAPL).

Photo by Artem Beliaikin on Unsplash

Our methodology

To come up with the 10 most popular dividend stocks on Robinhood, we scoured internet forums and determined which stocks are the most frequently traded among Robinhood users. We checked the yields of these stocks and then narrowed down our selection to stocks with dividend yields of at least 2% and above. We also took into account the hedge fund sentiment and analyst ratings to populate our list of the most popular dividend stocks and prioritized dividend yields in our rankings.

Most Popular Dividend Stocks on Robinhood

10. Johnson & Johnson (NYSE:JNJ)

Dividend Yield : 2.55%

Johnson & Johnson (NYSE:JNJ) has consistently increased its dividend payouts for about 59 years now. The company announced a quarterly cash dividend of $1.06 per share on January 4, 2022. The dividend is payable on March 8, 2022, to shareholders of record at the close of business on February 22, 2022.

This January, Raymond James analyst Jayson Bedford raised his price target on Johnson & Johnson (NYSE:JNJ) to $185 from $178 and kept an Outperform rating on the shares.

Here’s Distillate Capital’s stance on whether or not Johnson & Johnson (NYSE:JNJ) is a stock worth pouring money into:

“The largest additions in the rebalance, Johnson & Johnson (NYSE:JNJ) was around 50 and 40 basis points incrementally. J&J underperformed in the quarter while its normalized free cash flows held steady and so its position size was topped off to match the stable cash flows.”

9. The Coca-Cola Company (NYSE:KO)

Dividend Yield: 2.82%

The Coca-Cola Company (NYSE:KO) has regularly increased its dividend payouts for 59 years now and is dubbed as one of the highest yielding dividend kings. The company has a 5-year dividend CAGR of 3.71% and paid its last dividend of $0.42 per share on December 15, 2021.

This January, Guggenheim analyst Laurent Grandet upgraded The Coca-Cola Company (NYSE:KO) to Buy from Neutral and gave the stock a price target of $66, up from $61.

Like Exxon Mobil Corporation (NYSE:XOM), Verizon Communications Inc. (NYSE:VZ), Microsoft Corporation (NASDAQ:MSFT), and Apple Inc. (NASDAQ:AAPL), The Coca-Cola Company (NYSE:KO) is among the most popular stocks on Robinhood.

8. Pfizer Inc. (NYSE:PFE)

Dividend Yield: 3.35%

Pfizer Inc. (NYSE:PFE) has been consistent with increasing its dividend payouts for over a decade now. Pfizer Inc. (NYSE:PFE) has a 5-year growth rate of 6.32% and a dividend yield of 3.02% as of February 7, 2022. Pfizer Inc. (NYSE:PFE) announced an increase in the quarterly cash dividend on the company’s common stock to $0.40 for the first-quarter 2022 dividend, which will be payable on March 4, 2022, to holders of the Common Stock of record on January 28, 2022.

On January 28, 2022, JPMorgan analyst Chris Schott raised his price target on Pfizer Inc. (NYSE:PFE) to $57 from $53 and reiterated a Neutral rating on the stock.

Here’s what Saturna Capital said about Pfizer Inc. (NYSE:PFE) in its third-quarter 2021 commentary:

“The Fund’s strongest performer during the quarter was pharmaceutical manufacturer Pfizer Inc. (NYSE:PFE). The company submitted trial data to the FDA for use of its COVID-19 vaccine for younger children, and it is widely expected that the FDA will approve it. Health authorities also began recommending booster shots of the Pfizer vaccine for select populations, further increasing demand for vaccinations.”

7. National Fuel Gas Company (NYSE:NFG)

Dividend Yield: 2.83%

National Fuel Gas Company (NYSE:NFG) released earnings for the fiscal first quarter of 2022 this February. The company beat both EPS and revenue estimates. In January, National Fuel Gas Company (NYSE:NFG) was reinstated at BofA, by analyst John Abbott, who gave the stock a $66 price target and an Underperform rating.

National Fuel Gas Company (NYSE:NFG) has exhibited consistent growth in dividends over the past 8 years. GAMCO Investors was the leading shareholder in the company as of the third quarter of 2021. The fund’s stake in the company amounted to $66.62 million.

National Fuel Gas Company (NYSE:NFG) is a stock that has gained the attention of Robinhood investors. Some other stocks that Robinhood investors are pouring into include Exxon Mobil Corporation (NYSE:XOM), Verizon Communications Inc. (NYSE:VZ), Microsoft Corporation (NASDAQ:MSFT), and Apple Inc. (NASDAQ:AAPL).

6. Chevron Corporation (NYSE:CVX)

Dividend Yield: 3.68%

Chevron Corporation (NYSE:CVX) is yet another oil and gas company that has made it to the 10 most popular dividend stocks on Robinhood. The company’s track record shows 34 years of consistent dividend hikes, and it boasts a 5-year dividend growth rate of 4.36% and a payout ratio of 65.31%.

Chevron Corporation (NYSE:CVX) declared its quarterly cash dividend for the first quarter of 2022 on January 26, 2022, amid surging oil prices.

As of this February, Fisher Asset Management is the leading stakeholder in the company, owning over 6.59 million shares of the stock which amount to $774.21 million. The investment covers 0.43% of Fisher Asset Management’s 13F portfolio.

On January 31, 2022, Cowen analyst Jason Gabelman raised his price target on Chevron Corporation (NYSE:CVX) to $133 from $122 and reiterated an Outperform rating on the stock.

Goehring & Rozencwajg Associates mentioned Chevron Corporation (NYSE:CVX) in their third-quarter 2021 commentary. Here’s what the firm had to say about the stock:

“After successfully replacing 25% of Exxon’s board of directors despite owning just 0.02% of the outstanding equity, Engine No. 1, the climate-focused activist hedge fund, met with Chevron’s management late last summer. In discussions that were later described as “cordial,” Chevron Corporation (NYSE:CVX) executives shared their plan to reduce carbon emissions. Subsequently, Chevron announced new plans to further reduce carbon output, along with their intention to appoint a new director with “environmental expertise.” Although it remains unclear exactly what Engine No. 1 is planning, rumors suggest the fund has contacted other investors, strongly suggesting they intend to launch a second campaign in the not-too-distant future.

What should Chevron Corporation (NYSE:CVX) expect?

It was recently reported by The Wall Street Journal that Exxon was considering abandoning two massive natural gas projects: the 75 trillion cubic foot (tcf ) Rovuma LNG project (capital cost $30 bn) and the 5 tcf Ca Voi Xanh offshore-Vietnam gas project (capital cost $10 bn). Exxon board members (most likely including the three supported by Engine No. 1) have publically expressed concerns about both projects. According to internal reports, these projects are among the highest CO2 producers in Exxon’s pipeline; it is no surprise these projects have been called into question. However, we find the plight of both fields to be perplexing since production would almost certainly be used to displace coal in electricity generation, cutting CO2 emissions by nearly 50%. This fact seems to be lost on the new Exxon board members.”

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