In this article, we will take a detailed look at the 12 Best Foreign Stocks With Dividends. For a quick overview of such stocks, read our article 5 Best Foreign Stocks With Dividends.
While markets are roaring amid the Fed’s indication that it’s ready to begin interest rate cuts next year, some analysts still advise caution and do not expect a smooth or totally “soft” landing. Kristina Hooper, chief global market strategist at Invesco, while talking to CNBC, said that it would not be correct to believe that there would be no damage done to the economy in a soft landing scenario:
“That’s recognizing that in a soft landing, there’s no real damage. I think there will be some damage to the economy. It’s hard not to have some damage,” Hooper said.
While dividend stocks lost steam in 2023 amid a broader shift to growth on the back of the AI-led rally, companies that have strong dividend growth history under their belt and also have resilient fundamentals have always been on wise investors’ radar. Talking to CNBC, Todd Rosenbluth from VettaFi said that dividend companies will continue to get attractive as bond yields decline. The analyst also said major dividend payers allow investors to enjoy an overall market upside and also hedge against risks faced during market downturns.
Photo by Dan Dennis on Unsplash
Methodology
For this article we first used a stock screener to identify foreign (non-US) stocks with over 2% dividend yield. From this dataset we picked 12 stocks with the highest number of hedge fund investors. We ranked the stocks in the article in ascending order of the number of hedge fund investors. Hedge funds’ top 10 consensus stock picks outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here).
12. BP plc (NYSE:BP)
Number of Hedge Fund Investors: 35
British oil and gas company BP plc (NYSE:BP) ranks 12th our list of the best foreign stocks to buy now according to hedge funds. BP plc (NYSE:BP) has a dividend yield of over 4% as of December 21.
As of the end of the third quarter of 2023, 35 hedge funds tracked by Insider Monkey had stakes in BP plc (NYSE:BP). The most significant stake in BP plc (NYSE:BP) is owned by Ken Fisher’s Fisher Asset Management which owns a $711 million stake in BP plc (NYSE:BP).
11. LyondellBasell Industries NV (NYSE:LYB)
Number of Hedge Fund Investors: 36
Netherlands-based LyondellBasell Industries NV (NYSE:LYB) ranks 11th in our list of the best foreign dividend stocks to buy according to hedge funds. The stock has a dividend yield of over 5% as of December 21.
Earlier this month, Citi downgraded the stock to Neutral from Buy and also slashed LyondellBasell Industries NV (NYSE:LYB) stock’s price target to $98 a share from $105 a share previously.
Out of the 910 hedge funds tracked by Insider Monkey, 36 hedge funds were long LyondellBasell Industries NV (NYSE:LYB).
10. Barrick Gold Corp (NYSE:GOLD)
Number of Hedge Fund Investors: 36
Canadian mining company Barrick Gold Corp (NYSE:GOLD) landed in the list of stocks picked by Barron’s researchers for 2024. Barron’s is bullish on the stock since Barrick Gold Corp (NYSE:GOLD) plans to boost its mine output by 30% by the end of this decade, has a 2.3% dividend yield and “virtually” no debt.
Barrick Gold Corp’s (NYSE:GOLD) CEO Mark Bristow talked about dividends and debt during Q3 earnings call:
“But you talk about debt, we don’t really go into stacks of debt. Because I would just point out everyone in the industry listen to people like you, not you because you didn’t do it, but most fund managers asking for more and more dividends in an industry where it is capital intensive if you are growing it. And you noticed we didn’t do that. Although we distributed significant amounts of cash back to our shareholders. It was based on our P&L and our available cash, not going into debt to pay dividends. So today, we have paid down the debt to almost zero leverage. We have spent $7.5 billion plus into our business, and we have dividend out around $6 billion with all cash returns.
That is significant value we have created. And now we have got these projects where they all pass our filter of 15%. We look at return on capital invested of around 10% and IRR of around 50% depending on the project. So but RekoDiq is exceptional because we believe we can gear it, that it gives us that sort of return.”
Read the entire earnings call transcript here.
9. Petroleo Brasileiro ADR Reptg 2 Ord Shs (NYSE:PBR)
Number of Hedge Fund Investors: 36
Brazilian energy company Petroleo Brasileiro ADR Reptg 2 Ord Shs (NYSE:PBR) is one of the highest dividend stocks out there, with a yield of about 19%.
A total of 36 hedge funds tracked by Insider Monkey reported having stakes in Petroleo Brasileiro ADR Reptg 2 Ord Shs (NYSE:PBR). The biggest stakeholder of Petroleo Brasileiro ADR Reptg 2 Ord Shs (NYSE:PBR) was Rajiv Jain’s GQG Partners which owns a $3.18 billion stake in Petroleo Brasileiro ADR Reptg 2 Ord Shs (NYSE:PBR).
Fairlight Capital made the following comment about Petróleo Brasileiro S.A. – Petrobras (NYSE:PBR) in its Q3 2023 investor letter:
“Throughout the year, we have reviewed thousands of companies, including many in the oil sector. While we are generally cautious about commodity-based businesses where the company lacks control over the price of what it produces, the valuations in several cases have reached extremely compelling levels. For example, Petróleo Brasileiro S.A. – Petrobras (NYSE:PBR) and Ecopetrol (EC). Petrobras has distributed dividends of over $2.30 paid this year3 , while Ecopetrol has traded as cheaply as the $9-$10 range (close to our purchase price) and is paying approximately $2.50 in dividends this year.
We factor in the potential cost of FX movements over time, but even under the most pessimistic scenarios the investments should work out well. We initially came across these ideas while looking at South American stocks in general. We saw that many market commentators had expressed concerns that Ecopetrol’s dividends might be halted, especially following the election of Gustavo Petro as president of Colombia in June 2022. Similarly, there have been reservations about the sustainability of Petrobras’s dividend. However, the government owns substantial controlling stakes in these companies and is also a recipient of their dividends. For Ecopetrol, the Colombian government owes money to Ecopetrol due to the Fuel Price Stabilization Fund (FEPC). This fund aims to stabilize fuel prices for Colombian consumers. It bridges the gap between international and national Colombian consumer prices by compensating producers and importers for this price difference. The primary goal is to cushion the impact of global oil price fluctuations on the Colombian market. This is achieved either through cash payment or by forgoing dividend payments due from the government’s stake in these companies. In Ecopetrol’s case, the dividends paid (or those that would be paid to the government) are applied against the outstanding balances…” (Click here to read the full text)
8. Autoliv Inc (NYSE:ALV)
Number of Hedge Fund Investors: 37
Sweden-based Autoliv Inc (NYSE:ALV) makes safety systems for the automotive industry. In November Autoliv Inc (NYSE:ALV) upped its dividend by 3%. Forward dividend yield came in at 2.7%.
A total of 37 hedge funds out of the 910 funds tracked by Insider Monkey had stakes in Autoliv Inc (NYSE:ALV).
Autoliv Inc (NYSE:ALV) talked about its dividend and other important business updates during Q3 earnings call:
Our cash flow was strong and the debt leverage remained well within our target range. While we maintained our dividend and almost tripled the number of share repurchase compared to the second quarter. We are making progress towards our intention of reducing our indirect workforce by up to 2,000. We have now detailed a large part of our structural cost reduction actions, including optimization of the company’s geographic footprint and organization. The National Highway Transportation Safety Administration has issued a new initial decision to recall 52 million airbag inflators manufactured by our competitor ARC. Autoliv estimate that less than 10% of the indemnified inflators were included in airbag modules that Autoliv supplied to customers after Autoliv acquired certain Delphi assets in 2009.
Autoliv is not aware of any performance issues regarding the ARC inflators included with its airbags. At this stage, it is too early to talk about any replacement plan. We are, of course, prepared to support our customers with replacement products. The light vehicle production in 2023 is now expected to develop slightly better than expected, and we have therefore increased our full year organic sales indications in line with this.
Read the entire earnings call transcript here.
7. Agnico Eagle Mines Ltd (NYSE:AEM)
Number of Hedge Fund Investors: 38
Canadian-based mining company Agnico Eagle Mines Ltd (NYSE:AEM) has a dividend yield of about 2.9% as of December 21.
A total of 38 hedge funds out of the 910 funds tracked by Insider Monkey had stakes in Agnico Eagle Mines Ltd (NYSE:AEM).
The biggest hedge fund stakeholder of Agnico Eagle Mines Ltd (NYSE:AEM) during this period was Jean-Marie Eveillard’s First Eagle Investment Management which owns a $283 million stake in Agnico Eagle Mines Ltd (NYSE:AEM).
6. Canadian Natural Resources Ltd (NYSE:CNQ)
Number of Hedge Fund Investors: 41
With a dividend yield of over 4.5% and 41 hedge fund investors, Canadian Natural Resources Ltd (NYSE:CNQ) is one of the best foreign stocks with dividends according to smart money investors.
As of the end of September, the biggest stakeholder of Canadian Natural Resources Ltd (NYSE:CNQ) was Rajiv Jain ‘s GQG Partners which owns a $1.3 billion stake in Canadian Natural Resources Ltd (NYSE:CNQ).
Click to continue reading and see the 5 Best Foreign Stocks With Dividends.
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- 15 Best Dividend Stocks to Buy According to Warren Buffett
Disclosure. None. 12 Best Foreign Stocks With Dividends was initially published on Insider Monkey.