12 Best Dividend Penny Stocks to Buy According to Hedge Funds

6. Service Properties Trust (NASDAQ:SVC)

Stock Price: $2.69

Number of hedge fund holders: 16

Service Properties Trust (NASDAQ:SVC), is a real estate investment trust (REIT) primarily investing in hotel and service-oriented retail properties across the United States. With a portfolio of over 300 hotels and more than 800 retail properties, it is a significant player in the hospitality and retail real estate sectors. The company has created a focus on acquiring and managing properties that generate consistent cash flows, catering to both business and leisure travelers, as well as consumers seeking essential services.

In recent developments, Service Properties Trust (NASDAQ:SVC), has been making strategic moves to ensure liquidity in a volatile market. This includes a reduction of its quarterly dividend to $0.01 per share, in a bid to conserve approximately $127 million annually to bolster liquidity. This can be seen as a proactive strategy to counter economic uncertainties. The company has, however, displayed a continuous focus on shareholder value even in an unfavorable market. In January 2025, the company declared a regular quarterly cash distribution on its common shares.

In recent times, changing consumer patterns have caused frequent fluctuations in the hospitality retail industry. For REITs like Service Properties Trust (NASDAQ:SVC), this has meant remaining flexible and having agile strategies to navigate the changes. The company’s recent dividend adjustment and liquidity enhancement measures are indicative of broader trends within the industry, where companies are prioritizing financial flexibility to navigate market volatility.

Service Properties Trust (NASDAQ:SVC) has shown notable interest from hedge funds seeking income-generating assets as a dividend-paying option among penny stocks. Even at adjusted levels, the company’s decision to pay consistent dividends assures investors looking for exposure to the real estate sector with potential for dividend income.

The prospects of Service Properties Trust (NASDAQ:SVC) are strongly dependent on its ability to adapt to economic environments. Overall, its focus on essential service properties indicates attractive gains for shareholders, tapping into a sector with steady demands.