12 Most Reliable Dividend Stocks To Buy According to Hedge Funds

8. Union Pacific Corporation (NYSE:UNP)

Number of Hedge Fund Holders: 78

Union Pacific Corporation (NYSE:UNP) is an American transportation company that operates railroads, connecting 23 states. Railroads provide an incredibly efficient way to transport goods over land, with Union Pacific playing a central role in moving a wide range of bulk commodities. This diverse revenue stream helps stabilize the company’s income, though its performance is still influenced by economic cycles. When the economy is doing well, demand for products like agricultural goods, industrial materials, and energy increases, driving a higher need for the company’s services. On the other hand, during economic downturns, demand for these goods tends to fall. Despite these cyclical fluctuations, railroads typically maintain strong operating margins regardless of economic conditions.

In the third quarter of 2024, Union Pacific Corporation (NYSE:UNP) posted revenue of $6.01 billion, marking a 1% increase compared to the same quarter last year. Freight revenue, excluding fuel surcharge income, grew by 5%, driven by a 6% rise in revenue carloads. The company’s operating income reached $2.4 billion, an 11% increase.

Union Pacific Corporation (NYSE:UNP) also showed a solid cash position. In the first nine months of the year, it reported an operating cash flow of $6.7 billion, up from $5.9 billion during the same period last year. Free cash flow for the period also increased significantly, reaching $1.8 billion compared to $955 million in the previous year. The company has consistently honored its commitment to shareholders, having paid uninterrupted dividends to investors for 125 consecutive years. In addition, it has been growing its payouts for 18 consecutive years, which makes UNP one of the best dividend stocks. The company pays a quarterly dividend of $1.34 per share and has a dividend yield of 2.38%, as of January 12.

Union Pacific Corporation (NYSE:UNP) was a part of 78 hedge fund portfolios at the end of Q3 2024, compared with 82 in the previous quarter, according to Insider Monkey’s database. The stakes held by these funds have a total value of over $4.4 billion.