12 Best 5% Dividend Stocks To Buy According To Hedge Funds

1. Pfizer Inc. (NYSE:PFE)

Number of Hedge Fund Holders: 80

Dividend Yield as of February 5: 6.5%

Pfizer Inc. (NYSE:PFE) is an American pharmaceutical company that mainly manufactures, markets, and sells related products worldwide. The company made significant strides in commercial execution and experienced growth across its product portfolio for the full year of 2024. This included $3.4 billion in revenue from its legacy Seagen portfolio, as well as strong growth from products such as Vyndaqel, Eliquis, Xtandi, Nurtec, and several others across various categories.

In addition, Pfizer Inc. (NYSE:PFE) reported 12% operational revenue growth from its non-COVID products for the full year of 2024, highlighting the continued focus on commercial execution. It successfully achieved its $4 billion net cost savings target from the ongoing cost realignment program. As reflected in its 2025 financial guidance, the company has increased its overall savings target to about $4.5 billion by the end of the year. In addition, it is on track to achieve $1.5 billion in net cost savings from the first phase of the Manufacturing Optimization Program by the end of 2027, with initial savings expected in the latter half of 2025. The company remains confident in its ability to return to pre-pandemic operating margins in the years ahead.

Pfizer Inc. (NYSE:PFE) currently offers a quarterly dividend of $0.43 per share, having raised it by 2.4% in December 2024. This marked the company’s 15th consecutive year of dividend growth, which makes PFE one of the best dividend stocks on our list. The stock supports a dividend yield of 6.5%, as of February 5.

As of Q3 2024, 80 hedge funds tracked by Insider Monkey held stakes in Pfizer Inc. (NYSE:PFE), down from 84 in the previous quarter. These stakes are collectively valued at over $3 billion. With nearly 17 million shares, Two Sigma Advisors was the company’s leading stakeholder in Q3.

Overall Pfizer Inc. (NYSE:PFE) ranks first on our list of the best dividend stocks with over 5% yield. While we acknowledge the potential for PFE as an investment, 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 PFE but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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